Press Release / / 10.07.21

Sudan Report: Banking Reforms Needed to Counter Corruption Slowing Economic Progress

New Report:

Banking Reforms Needed to Counter Deep-Seated Corruption Slowing Economic Progress in Sudan 

  • Positive Steps by Transitional Government Undermined Due to Lack of Transparency and Enforcement
  • Experts Urge Critical Policy Actions to Address Entrenched Corruption, Rebuild Economy, and Encourage Foreign Investment

October 7, 2021 (London / Washington, DC) – Issues of economic mismanagement and corruption in Sudan left over from the regime of Omar al-Bashir have yet to be transparently addressed and are hindering economic progress, according to a new report published today by The Sentry. In the report, “Sudan Banking Sector Reforms and Asset Recovery,” The Sentry’s Senior Advisor Oliver Windridge outlines key banking reforms that must be adopted to rebuild the economy, mitigate risks, and encourage foreign investment.

Although Sudan’s transitional government has taken important first steps to improve the country’s basic anti-money laundering and countering the financing of terrorism (AML/CFT) regime, progress towards achieving the stated goal of a “modern, democratic nation state” has been slow, and the country still ranks as one of the most corrupt countries in the world.

Oliver Windridge, Senior Advisor at The Sentry, said: “The ultimate success of Sudan’s transition from kleptocracy to democracy will rely in large part on the creation of a strong, prosperous economy for all Sudanese. Critical to this transition is effective banking reform, including greater efforts to tackle corruption, improved AML implementation, and a strong independent Central Bank, coupled with increased international efforts to return assets looted under the previous regime. The time is now for the Sudanese government and its international allies to make this transition a reality.”

Suliman Baldo, Senior Advisor at The Sentry, said: “The government of Sudan has announced policy reforms aimed at consolidating the independence of the Central Bank and tightening its oversight and regulatory role in the banking and financial sectors. These positive efforts include ordering the Central Bank to sell its shares in public and private banks and removing its managers from the boards of directors of banking institutions in which the Central Bank has shares. However, actual implementation of these sound decisions has lagged behind. Such delays are undermining the credibility of the announced reforms and are responsible for costly delays in normalizing Sudan’s correspondent banking relations with the rest of the world. Until these announced reforms are put into action, Sudan will continue suffering from its decades-long isolation from the global banking community.”

The Sentry report details how the Sudanese government and banking sector can demonstrate greater transparency, enforce Sudan’s existing anti-money laundering laws and policies, and improve banking supervision policies and practices in order to help set Sudan on a path to recovery.

Report recommendations:

  • An international body such as the World Bank or International Monetary Fund (IMF) should conduct forensic audits of the Central Bank and other regulatory bodies alongside a domestic partner.
  • The government of Sudan should identify and ensure the removal of security force elements from private firms.
  • The government of Sudan should prioritize FIU reform.
  • The government of Sudan should strengthen the judiciary.
  • The United States, the United Kingdom, and other governments should implement tailored responsible investment reporting requirements.
  • Sudan’s Central Bank must play an independent and transparent role in banking supervision.
  • The Central Bank, with the assistance of international partners, should encourage Sudan’s banking sector to file suspicious activity reports (SARs).
  • Global correspondent banks should engage with and, as needed, pressure Sudanese banks to improve their AML/CFT compliance programs.
  • The international community should continue their assistance programs to support Sudan’s new government.
  • The Middle East and North Africa Financial Action Task Force (MENAFATF), should help develop an AML/CFT action plan for Sudan’s government,
  • Sudan and its allies should form an international partnership to identify, seize, and return ill-gotten Bashir-era gains stashed overseas.
    • This international partnership should comply with established international standards on transparency and asset recovery.
    • This international partnership should be housed within the International Anti-Corruption Coordination Centre.
    • This international partnership must engage now on how to return assets.
    • Sudanese and international banks and other financial Institutions must commit to cooperating fully with this international partnership.

Read the full report and recommendations:

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About The Sentry

The Sentry is an investigative and policy team that follows the dirty money connected to African war criminals and transnational war profiteers and seeks to shut those benefiting from violence out of the international financial system. By disrupting the cost-benefit calculations of those who hijack governments for self-enrichment, we seek to counter the main drivers of conflict and create new leverage for peace, human rights, and good governance. The Sentry is composed of financial investigators, international human rights lawyers, and regional experts, as well as former law enforcement agents, intelligence officers, policymakers, investigative journalists, and banking professionals. Co-founded by George Clooney and John Prendergast, The Sentry is a strategic partner of the Clooney Foundation for Justice.