The government of Cameroon has now laid before MPs a bill governing banking secrecy. The bill seeks to include microfinance and electronic payment operators in the old banking secrecy law.
“In light of the advances recorded in the financial and technology sectors, certain components of the current law, which is 18 years old, have become obsolete. Furthermore, the advancements in the financial industry are also accompanied by new hazards associated with the development of illicit activities, such as money laundering, cybercrime, and terrorism financing,” the bill’s explanatory memorandum reads.
Here Is What You Need To Know
- If the bill is approved as is, microfinance and electronic payment operators, the fruits of recent financial and technological breakthroughs, will be subject to banking secrecy in the same way that traditional banks are.
- According to the draft law, banking secrecy here consists in the requirement of confidentiality to which the institutions subject are bound with regard to the acts, facts, and information concerning their customers that they become aware of in the course of their professions.
- However, the article emphasizes that banking secrecy also implies that institutions subject to it must engage with legal authorities that can conduct investigations or administrations that combat money laundering and terrorism financing.
- A deposit of more than 5 million FCFA in a financial institution, for example, is required by law to be reported to the National Agency for Financial Investigations (ANIF) for information.
- In other words, microfinance and electronic payment operators were not compelled to apply the rights (non-disclosure of bank data) and duties under the old law controlling bank confidentiality (collaboration with judicial and monetary authorities). If parliament accepts this legislation, these new players will be subject to the same laws as traditional banks in the future.
- Non-compliance with this banking secrecy (rights and obligations), according to the text given for parliamentarians’ approval, is punishable by imprisonment for three months to three years and a fine of one million to fifty million FCFA, or one of these two penalties only.
- The penalties are twofold if the offense is committed by the written press, radio, television, electronic communication, or any other means intended to reach the public.
- There is also provision for the institution or branches utilized to commit the incriminated activities to be closed for a set period of time.
fintech law Cameroon fintech law Cameroon
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning writer