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Seychelles - Threat Assessment - 2020 Page 1 of 35

modern day slaves in Seychelles or the GSI
 Seychelles incidence, yet the country is considered to
 have a “B” response. In the US Traffi cking in
 Section 1 - Executive Summary Persons report, Seychelles has a Tier 2 rating.

Grey Lists: Seychelles is not listed by FATF, EU Sanctions & Terrorism: There are no sanctions
nor by the US as a “Country of Primary against the country. Seychelles is a Tier 3 (Low
Concern” in respect of ML & FC threat) PPI 2019 (Proliferation) Index country
 with a “Moderate” response score of
NRA: The NRA was published in 2017. The
 426/1,300. Seychelles has a “0” impact score
overall ML threat was rated “Medium High”
 (0/10) in the Global Terrorism Index 2019
with vulnerability level for ML as “Medium
High” & ML risk for Seychelles rated overall at Response & Resilience: FATF MER 4th round
“Medium High.” The potential threat level in results by ESAAMLG were 55/100 for technical
respect of TF risk was rated as “Low”. Based on compliance (40 Recommendations), & 3/100
an assessment of ML threats from 2013-2015, for effectiveness (11 Outcomes). Seychelles
estimated prevalence and proceeds of crime scored 5.38/10 for resilience (Moderate),
generated were identifi ed as drug traffi cking, ranked 11/54 for Africa in the OC Index.
which came fi rst, followed by (in order), tax
 Indices: Seychelles scored 72/100 and was
evasion, smuggling, corruption, company
 rated “partly free” in the 2019 Freedom in the
fraud, fraud/forgery, theft & robbery.
 World report, and 64.3/100 for economic
Organised Crime: According to the OC Index, freedom (Heritage Foundation) described as
Low Criminality - High Resilience. Criminality “moderately free ”. The Mo Ibrahim Index of
3.93/10, (ranked 42nd lowest of 54 African African Governance (IIAG) scored Seychelles
countries. Main markets are drugs (heroin 2nd in Africa at 73/100. The Basel AML Index
(6.5/10), wildlife crime (6/10), human 2016 scored Seychelles 6/10.
traffi cking (4/10) and drugs (synthetics (4/10).
 Overall Ratings: Seychelles is rated 2nd best
The main “Criminal Actors” are “Foreign
 out of 40 in SSA and 2nd best out of 10 in East
Actors” (6.5/10), “Criminal Networks” (4.5/10),
 Africa, with an overall risk score of 72/100 -
“State Embedded Actors” (4/10), and “Mafi a
 “Low” risk, 83/100 “Very Low” level for Threats,
Style Groups” (2/10).
 and 60/100 “High” level for Response, with an
Corruption: TI CPI - 2019 - ranked 27/198, “Improving” trend.
with a score of 66/100, an improvement from
2017, where Seychelles had a score of 60/100.

 FCN Rating:”Low” Risk 72/100
Modern Slavery: The 2018 GSI Index doesn’t
 “Improving”
include data about the number of estimated

 Seychelles - Threat Assessment - 2020 Page 2 of 35

Section 2 - Country Dashboard

 Seychelles ➡ Neutral
 Capital & Population: Victoria / 96,800 approx
 Political Leader: Danny Faure, President (since 2016)
 GDP: US$1.498 billion (2017) - 1.7% of the SSA economy.
 Economic Sector Breakdown: Agri (2.5%), Ind (13.8%), Services
 (83.7%).
 Exports: canned tuna, frozen fi sh, petroleum products (re-exports) to UAE 28.5%,
 France 24%, UK 13.8%, Italy 8.9% and Germany 4.6% (2017)
 Imports: machinery and equipment, foodstuffs, petroleum products, chemicals,
 other manufactured goods from UAE 13.4%, France 9.4%, Spain 5.7% and South
 Africa 5% (2017).

 Score: 72/100 “Low” FCN Risk Rating Proceeds / Laundering
 (Average Country Score is 43 - SSA)

 Rank: 2/40 SSA - 2/10 Region EA range 4.5% - 7.5% GDP / 70 - 76% of Proceeds

 Organised Crime Costs of Corruption
 range up to approx 24 - 26% of Proceeds range up to approx 5 - 10% of Proceeds
 (State Embedded 4/10, Criminal Actors 4.5/10, Foreign Networks 6.5/10 & Mafia Style 2/10)

 Seychelles Higher (Inherent) Risk Factors Total Criminal Proceeds in Sub
 Saharan Africa in US$ Billions - FCN
 Customer Sector Geography 2020 (not including fraud and
 Risks Risks Risks
 corruption and tax evasion)
 Customers with elevated Banks (in particular commercial Major export / import partners
exposures to criminal activities banks with international (trade mispricing via IFFs)
 such as: business - offshore links
 drug trafficking, and Drug trafficking threat from -
 Luxury real estate; Afghanistan Pakistan, SE Asia
 smuggling, company fraud, Mining Fishing
 and Western Europe, as source
 fraud/forgery, theft & robbery 10 2.5
 Dealers in motors vehicles, and destination countries. Also
 along with corruption (e.g yacht’s and boats; trans-shipment point for heroin
 Wildlife
 2 Goods Piracy
PEPs) which also help facilitate for East Africa including Kenya
 TCPS - international / offshore Madagascar, Mozambique and
 9
these crimes & tax evasion as a
 business South Africa and from Dubai to
high risk concern also to Higher
 Seychelles - (heroin).
Risk Sectors and/or Geography Bureaux de change.
 Logging
 Risks Migrant workers—including 12.5
 from Bangladesh, India, China, Modern Slavery
 Kenya, Madagascar, and 8.3
 countries in South Asia - some
 have working conditions akin Drugs
 to forced labour
 3
 Theft
 Illegal Fishing - China 15

 TF Threat from - Somalia,
 Madagascar and Yemen

 FCN SSA Country Risk Rating - “Very Low” Threats - "

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 FCN SSA Country Risk Rating - “High” Response - "

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 Seychelles - Threat Assessment - 2020 Page 3 of 35

3. Country Information
People & Geography: The Seychelles is an Economy & Trade: In 2017, the GDP was
archipelago country in the Indian Ocean US$1.498 billion with government revenues
consisting of 115 islands. It has a population of amounting to US$593.4 billion. The GDP per
almost 100,000 people which is the smallest capita in 2017 was US$29,300. The
population of any African country, yet it is one Seychelles’s economy is made up of
of the wealthiest, classifi ed as a “High Income agriculture 2.5%, industry 13.8%, services
Economy” by the World Bank. Seychelles is a 83.7% and these sectors encompass the
beautiful country, who’s diverse landscape coconuts, cinnamon, vanilla, fi shing as well as
encompasses coral reefs, beautiful boulder- fi nancial services, information and
strewn beaches, virgin jungles and UNESCO- communications technology, education,
listed nature reserves. The island of Male is hospitality and property development.
home to Seychelles capital Victoria. Of its Seychelles exports canned tuna, frozen fi sh,
96,800 population, Seychelles counts some petroleum products (re-exports) to UAE 28.5%,
12,900 migrants for 2019, and 36,800 France 24%, UK 13.8%, Italy 8.9% and
emigrants. Germany 4.6% (2017) .The country imports
 machinery and equipment, foodstuffs,
Recent History & Leadership: Whilst the petroleum products, chemicals, other
French claimed possession of the Seychelles manufactured goods from UAE 13.4%, France
islands in 1756, the Seychelles was ceded to 9.4%, Spain 5.7% and South Africa 5% (2017).
Britain after the Napoleonic Wars in 1814.
From then until 1903, it was administered from Environment: Seychelles is home to an array
Mauritius. In 1964 the Seychelles Democratic of wildlife, including giant tortoises and sea
Party (SDP), led by James Mancham, was turtles. Much of the land is protected as part of
founded, although Seychelles would only nature reserves.
become independent in 1976, with Mancham
as President and rival Albert Rene of the SPUP Tourism: The total contribution of Travel &
as Prime Minister. The SPUP staged an armed tourism GDP was SCR9,220.9 million
coup in June 1977, and Seychelles became a (USD657.5mn), 40.5% of GDP in 2019. The
socialist state, with René as its president, and labour force for this sector is more than 20,600
the SPUP was renamed the Seychelles People’s in direct employment, representing 43.8% of
Progressive Front (SPPF) - the sole political the total employment rate in country.
party. Thereafter there was extensive The main tourist attractions include: Anse
nationalisation of enterprises, including hotels Lazio, La Digue, Morne Seychellois National
and industries. There were also a number of Park, Cousin Island and Silhouette Island
threatened coup plots against the René
government. In December 1991, the Finance: In terms of remittances, the country
government passed laws to provide for has estimated infl ows of US$23 million (1.4%
multiparty democracy. Danny Faure has been of the GDP) for the year 2019 according to the
president since 2016, after previously holding World Bank. Connectivity-wise in 2019, there is
the position of fi nance minister and the an internet penetration rate of 76% & 170,700
governor of the IMF, the World Bank and the mobile connections.
African Development Bank.

 Seychelles - Threat Assessment - 2020 Page 4 of 35

4. Country Ratings
Available information from leading sources produce over 60 ratings for Seychelles, covering both
threats and responses in fighting financial crime, sanctions, proliferation finance and terrorism &
terrorism finance.

 Source Seychelles Source Seychelles Source Seychelles 

 World Economic Forum 63.9/ 100 Transparency International (TI) 66/ 100 Proliferation Index - PPI Tier 3
 Organised Crime Index* Corruption Perceptions Index* (27/198) Threat Low Threat Level

 OC Index 3.93/10 TI & Afrobarometer Not Included Proliferation Index - PPI 426/ 1300
 Criminality* Citizens Views and Experiences of Corruption Controls* Controls score
 Report

 OC Index 4.25/10 TRACE 49 Global Terrorism Index Not Included
 Criminal Actors Bribery Risk Matrix (87/200) GTI - Impact*

 OC Index 4/10 Global Slavery Index Not Included US Dept of State Not Included
 State Embedded Actors GSI Incidence* Country Reports on Terrorism*

 OC Index 4.5/10 Global Slavery Index Not Included Global Cybersecurity Index 0.259/10
 Criminal Networks No of estimated Modern Day Slaves 2018 (110/175)

 OC Index 6.5/10 Global Slavery Index Not Included Mo Ibrahim Governance Index 73/100
 Foreign Actors Country Response Rating* (49.9 - All Africa)* (Increasing improvement) (2/54)

 OC Index 2/10 US Dept of Labor Not Included Freedom House 72/100
 Mafia Style Gangs Child Labour Freedom Index* “partly free”

 OC Index Heroin 6.5/10 & Synthetic’s 4/10 US Dept of State Tier 2 Rated Heritage Foundation 64.3/100
 Drugs Trafficking Cannabis 3/10 & Cocaine 2.5/10 Trafficking in Persons* Economic Freedom Index “Moderately free”

 OC Index 2.5/10 IOM Migration I - 12,900/E - 36,800 Basel AML Index* 6/10
 Arms Trafficking E - Emigration / I - Immigration (2016)

 OC Index 3.5/10 Illegal Unreported and Unregulated 2.13 FIU Egmont Yes
 People Smuggling (IUU) - IUU Fishing Index 107/152 Member

 OC Index 4/10 EU Listing of Countries for Illegal No Interpol Yes
 Human Trafficking Fishing Member

 OC Index 3/10 US DoS - Wildlife Trafficking Not Included Asset Confiscations No
 Illegal Timber Focus / Countries of Concern* over 1% of Proceeds*

 OC Index 6/10 Environment Performance Index Not Included Country National Risk Assessment* Yes
 Illegal Wildlife (2017)

 OC Index 1/10 EUIPO & OECD Counterfeit Goods 0.000 Financial Information Sharing No
 Illegal Mining Propensity of Exports (2016) Partnership

 OC Index 5.38/10 70 US Dept of State No
 Resilience* Tax Justice Network 95/133 INCSR Vol I & Vol II*
 Financial Secrecy Index

 OC Index 3.5/10 EU List of None Co operative Non co operative European Union List* Yes
 AML Jurisdictions for Tax purposes

 OC Index 7/10 OECD - Global Forum Partially Compliant FATF Standards 55/100
 Law Enforcement on Transparency & Exchange Info for Tax Purposes 40 Recommendations*

 OC Index 6/10 Global Financial Integrity US$72million - 16.76% (2017) FATF Standards 3/100
 International Co- operation Illicit Financial Flows* 11 IO’s on Effectiveness*

 OC Index 3.5/10 Embassy’s from N Korea, Syria, Iran Yes - Cuba FATF Standards 50/100
 Economic Regulatory Environment or Cuba Core 10 Recommendations

 Illegal Drug Dependency / Disorders 772,060/0.79% Embargoes - Country Sanctions None FATF Standards 8/100
 Number/Share (Comprehensive - UN, US, EU, UK) Core 4 IO’s on Effectiveness

 Numbeo Crime Survey 2020 Not Included OFAC Listed Parties 8 FATF No
 with Local Addresses Counter - Measures
 Strategic Deficiencies List*

 * Symbol Indicates the information is included in the FCN Country Index

 Seychelles - Threat Assessment - 2020 Page 5 of 35

Section 4 Continued - Country Threats Heat Map

There are many threats that effect Seychelles, which are in most part targeted towards its resources,
be they its natural resources, the people, it’s forests, crops and fish. The effect of corruption
increases the threats and reduces the ability to effectively respond. For more details in summary
form see the figure below.

 Seychelles - Threat Assessment - 2020 Page 6 of 35

TI - Corruption Perceptions Index (Scores out of 100) - 
 (Scores out of 10 - higher scores are better)

 66.0
 60.0 60.0
 52.0 54.0

 2012 2014 2016 2018 2019

Seychelles - Threat Assessment - 2020 Page 7 of 35

Section 5 - Key Threats in Detail

In this Section 5, the most important criminal 5.3 Corruption: Corruption is not only a
markets, are assessed and summarised based signifi cant generator of illicit funds, but also an
on available sources. enabler of other serious crimes which protects
 those involved from investigation, prosecution
5.1 National Risk Assessment (NRA):
 and/or conviction.
Seychelles published its AML/CFT NRA in
20171. The report , covering the period 1 TI - Corruption Perceptions Index (Scores out of 100) - 
 (Scores out of 10 - higher scores are better)
January 2013 to 31 December 2015, found
that based on assessing threats and
vulnerabilities, the overall threat level for
 66.0
 60.0 60.0
money laundering (ML) for Seychelles was 52.0 54.0

“Medium High”. The terrorist financing (TF)
risk was assessed “Low”. and the threat from 2012 2014 2016 2018 2019

abroad as “Medium Low”.
 Transparency International’s (TI) Corruption

 Medium High Risk Perceptions Index (CPI) in 2019 rated
 National Risk Assessment 2017 Seychelles 66/100 and ranked 27/198, an
 improvement from 2017, where Seychelles
Despite “there being no data set reflecting the
 had a score of 60/100 (scores are from zero
amount of money earned from criminal activity,
 (highly corrupt) to 100 (very clean). “Several
the NRA found that the predicate offences
 anti-corruption laws, including a recent access
which were generating the most proceeds of
 to information law, and a newly established
crime were drug trafficking, Tax evasion,
 anti-corruption commission have helped
Smuggling of goods, Corruption and Fraud”.
 strengthen the country’s anti-corruption
For more details on specific threats see framework. In addition, despite some
separate sections on for example, drug restrictions, dialogue between civil society and
trafficking, corruption, environmental crimes government occurs through a national civil
and tax evasion below. society platform”2.

5.2 US INCSR: Seychelles is not listed in Seychelles considered one of the least
Volume 1 or in Volume 2 as one of 80 corrupt nations in Africa
 OC Index 2019
countries categorised by the US State
Department as a Country/Jurisdiction of Notwithstanding the international perspective
Primary Concern in respect of Money and high scores for managing corruption, the
Laundering and Financial Crimes in its 2019 Seychelles NRA considered that corruption
Report.

 Seychelles - Threat Assessment - 2020 Page 8 of 35

was a significant generator of illicit funds, and Africa Integrity Indicators scores Seychelles a
was rated “Medium High”. 57.7/100 (“Increasing Improvement” - ie
 progress over the last 10 years, with the rate of
According to the NRA, “people who hold
 improvement increasing) under transparency
positions of authority in Government, the
 and accountability 2019 (Global Integrity
general public sector as well as private sector
 2019)5.
players are viewed perpetrators of the offence.
The lack of transparency in relation to the 5.4 Organised Crime: The OC Index states
award of contracts, tenders, land from the land that “Seychelles is rated as Low Criminality
bank, the operations of companies fully owned and High Resilience, (as opposed to High
by the government, no audit having been Criminality - High Resilience, High Criminality -
carried out on capital projects, and the lack of Low Resilience and Low Criminality - Low
capacity on the oversight and governance Resilience) alongside other Sub-Saharan
mechanisms put in place by government are countries such as: Botswana, Ethiopia, Ghana,
contributors to the high rating given to Mauritius, Namibia, Rwanda, Senegal and
corruption as a predicate offence to ML”. Cape Verde. The OC Index report highlighted
 that “Seychelles was noted for being a centre
The NRA went on to say that “state-embedded
 for money laundering and illicit fi nancial fl ows,
actors have a moderate influence in the
 yet committed investment has reduced those
Seychelles, but are known to be involved in the
 fl ows and made it a signifi cant partner in
illegal fishing industry. Although levels of
 regional maritime security efforts All of this
corruption in the country are not insignificant,
 indicates that the quality of governance and
state- embedded actors do not control any of
 determined political will can produce
the illicit markets in Seychelles. Nor do they
 considerable results, even in the case of weak
have any discernible links with domestic
 states”.
criminal actors.”
 Low Criminality - High Resilience
The 2018 TRACE Bribery Risk Matrix places
 Africa’s OC Index 2019
Seychelles in the “moderate” risk category,
 According to the 2019 OC Index “Seychelles
ranking it 87 out of 200 surveyed countries
 has a high resilience to organised crime,
with a risk score of 493.
 ranking 11th in Africa. The government is vocal
TI also reported on the importance and and open about its stance against organised
correlation between the lack of freedom and crime, particularly regarding piracy and drug
corruption, citing Freedom House, in its 2019 trafficking. Seychelles is also considered one of
Freedom in the World report, which accords the least corrupt nations in Africa.”
the status of “partly free” to Seychelles with
an aggregate freedom score of 72/1004.

 Seychelles - Threat Assessment - 2020 Page 9 of 35

“Mafia-style groups are virtually non-existent in synthetic dugs trafficking (4/10) and human
Seychelles. Criminal networks, with a score of smuggling (3.5/10), with illegal logging, and
4.5/10, have a moderate influence on cannabis trafficking (3.0/10), cocaine and arms
organised crime the country. They also state trafficking (2.5/10) and illegal mining at
that “Foreign actors are the highest-scoring 1.0/10). The main “Criminal Actors” are
criminal actor type in Seychelles, with 6.5/10, “Foreign Actors” (6.5/10), “Criminal
and are deeply involved in drug trafficking. Networks” (4.5/10), “State Embedded
Foreign nationals are also responsible for a Actors” (4/10), and “Mafia Style Groups” (2/10).
large proportion of the illegal fishing that
occurs in Seychelles’ national waters; and are OC Index - Criminal Actor Types - Importance - 
 (Scores out of 10 - lower scores are better)

involved in human trafficking, primarily for
forced labour, within the Seychelles.”

 6.5
 OC Index Criminal Markets - Importance - 
 (Scores out of 10 - lower scores are better) 4.5 4.0
 2.0

 Criminal Networks State Embedded Foreign Actors Mafia Style

 6.0
 5.5.1 Environmental Crimes: Illegal Wildlife
 4.0 4.0 3.5
 3.0 3.0
 2.5 Crimes: According to the 2019 OC Index, “As
 1.0
 Synthetics Wildlife HT Mining Logging Arms Cannabis People Smugg
 an island nation, Seychelles is largely protected
According to the 2019 African OC Index, from the wildlife traffi cking that affl icts many
Seychelles scores Criminality at 3.93/10 and other African nations, such as ivory and rhino
ranks 42nd (out of 54 African countries) and horn traffi cking”. However, Seychelles is
7/13 in Southern African countries in the Index mentioned in a TRAFFIC report as a nation that
for levels of criminality, with criminal networks conducts wildlife trade with China6. In 2016 Air
having a “moderate influence on organised Seychelles signed the Buckingham Palace
crime the country. They are involved in the drug Declaration pledging support for the United
trade, acting as an interface between foreign for Wildlife Task Force.
players in transnational drugs markets and
 A media article7 reported that in 2013 a
domestic users. These loosely organised
 Seychellois woman was caught with 60kg of
criminal networks are often based on family
 hawksbill turtle shells, with an estimated value
ties”.
 of USD$8,300, in her luggage by Singapore
The main markets, according to the OC Index, customs authorities. Wildlife trafficking is not
with highest criminality scores were illegal included in the the NRA.
drugs, with heroin (6.5/10) and environmental
 5.5.2 Environmental Crimes: Illegal
crimes the most important, Illegal wildlife and
 Logging: According to the Food and
Illegal fishing (6/10), human trafficking and
 Agriculture Foundation of the United Nations
 Seychelles - Threat Assessment - 2020 Page 10 of 35

Seychelles - Threat Assessment - 2020 Page 11 of 35

(FAO)8, “The main challenges facing the deplete fi sh stocks. Local people are forced to
forestry sector are poaching of protected fi sh illegally to make a living.”
palms, illegal felling of protected trees, social
 Seychelles scores 2.13/5 overall on the 2018
housing development, invasive species, bush
 IUU Fishing Index10, measured against
fires, climate change and management of
 vulnerability, prevalence and response (1 =
protected areas.
 good/strong; 5 = bad/weak). Seychelles has a
The main challenges facing the forestry high vulnerability score (3.12) but a high
 sector are poaching of protected response score (1.64).
palms, illegal felling of protected trees,
 Seychelles has a vast Exclusive Economic Zone
 social housing development, invasive
 of 1.4 million square kilometres, and has been
species, bush fires, climate change and
 been plagued by Sri Lankan fishing vessels11
 management of protected areas
 OC Index 2019 that have allegedly been illegally fishing in
 Seychelles waters.12
The main contributing factors are deforestation
and forest degradation, limited land for social Illegal fishing in Seychelles poses a
housing development, and natural disasters significant problem and is costly to the
such as bush fires and landslides. The coco-de- economy and environment
 OC Index 2019
mer serves as an example – on account of its
economic value both locally and on the Seychelles is piloting a project using new
international market, there have been recent approaches to reduce fisheries crime using
increases in poaching incidents which are now “analytical capacity-building in combination
threatening the coco-de-mer trees in the Vallée with drones equipped with artificial
de Mai. The coco-de-mer has been listed as intelligence (AI)” to detect illegal fishing13. In
critically endangered by the IUCN”. According 2019, the Ministry of Fisheries and Agriculture
to the World Bank in 2016, Seychelles was the has also published a “Fisheries
4th greenest country in the world with 88.4% Comprehensive Plan”14 to “guide the future
of the land area as forests9. actions and spearhead the development for the
 fisheries sector for the next three years…..This
5.5.3 Environmental Crimes: Illegal Fishing:
 Comprehensive Plan covers a wide spectrum of
The 2019 OC Index reports that “illegal fi shing
 activities overlapping those of other Ministries
poses a signifi cant problem and is costly to the
 and institutions not necessarily affiliated with
economy and environment. Seychelles ranks
 the Ministry of Fisheries and Agriculture. As
21st in the IUU Fishing Index on the prevalence
 such, it requires great collaboration, but most
of illegal fi shing. The primary driver of illegal
 importantly, financial resources to implement
fi shing in the country is extreme overfi shing,
 the policy. While the responsibility to finance
predominantly by Chinese trawlers, which
 the implementation generally rests with the
 Seychelles - Threat Assessment - 2020 Page 12 of 35

Government, most of the interventions could According to the NRA, drug trafficking
also be materialised with support of our generated USD$1.5 million of the value of
stakeholders.” the proceeds between 2014 - 2015. This figure
 is considered to be a conservative figure as
Seychelles has embarked on a Blue Economy
 other information obtained suggests that “a
Strategic Roadmap, which is “an integrated
 large number of investments being financed
approach to ocean-based sustainable
 from proceeds of drug trafficking are invested
development which brings together economy,
 overseas in neighbouring countries and locally
environment and society, consistent with the
 using domestic companies and legitimate
Sustainable Development Agenda 2030
 businesses”.
(SDG’s)”. One of the expected outcomes of this
initiative is “Improved prevention of ocean/ OC Index - Drug Trafficking - Importance - 
 (Scores out of 10 - lower scores are better)
blue economy risks including illegal,
unreported and unregulated (IUU) fishing,
marine pollution and climate change through
 6.5
integrated approaches to effective regional 4.0
 2.5 3.0
cooperation on maritime security”15.
 Cocaine Synthetics Cannabis Heroin

According to Defenceweb16, “The Seychelles
 The NRA rated drug trafficking as “Medium
has a fishing traceability policy that allows
 High”.
global consumers to see the origination of tuna
caught by Seychellois fishing boats. This market
 Drug trafficking “Medium High”
transparency adds value to legal catches and NRA 2017

discourages illegal fishing.”
 Drugs from Kenya and Dubai are smuggled
5.6 Drug Trafficking: According to the 2019 into Seychelles using trade mechanisms and
OC Index, “The most pervasive criminal market couriers. The importation of heroin is
in Seychelles is the heroin trade, which scores reportedly “monopolised by different clusters
6.5/10 in the Index, due to high domestic use of groups of people, mostly constituting
of the drug. The island nation is a destination families”. Increased maritime patrols in the
country for heroin traffi cked from East Africa Indian Ocean have led to the increased use of
and the Asian subcontinent. Seychelles is also Seychelles waters “being used as a transit route
an important maritime trans-shipment point for for the drug trade from North to South”. The
heroin from Afghanistan destined for East drugs are thought not to be intended for
Africa, Madagascar, Mozambique and South Seychelles consumption. According to
Africa. Its role is growing as maritime routes investigations performed, proceeds from drug
shift in response to military interdictions at sea.” trafficking are laundered in the Seychelles
 through the “use of the banks, the BDCs, the

 Seychelles - Threat Assessment - 2020 Page 13 of 35

real estate sector and the motor vehicle sector”. The UN Office on Drugs and Crime announced
It was also reported that “apart from incidences in 2018 its intent to reestablish a presence in
of piracy, the only recorded illegal activity on Seychelles to increase drug trafficking security
some of the ‘outer’ islands is poaching and measures, reduce the demand for drugs, and
drop offs for drug traffickers”. enact prison reform. Among the reforms
 enacted is consideration of drug addiction as a
Seychelles has an estimated 772,060 people17
 disease rather than a crime, allowing greater
with illegal drug use disorders (2017),
 possibilities for treatment and rehabilitation
representing 0.79% of the population.
 among drug abusers.
A BBC media article claims that Seychelles has
 In 2018, a media article on illegal fishing in
the world’s worst heroin problem, with
 Seychelles reported that one of the resource
“between 5,000 and 6,000 people out of a total
 challenges for the fishing sector was
population of 94,000 - the equivalent of nearly
 highlighted as “getting local manpower and
10% of the working population - are addicted
 this is largely related to drug abuse, which is
to heroin, according to the Agency for the
 especially affecting the younger population”20.
Prevention of Drug Abuse and Rehabilitation
(APDAR) in the Seychelles”18. The drugs from 5.7 Modern Slavery: The 2020 US Traffi cking
Afghanistan are reportedly smuggled to the in Persons (TIP) report21 rates Seychelles as a
island via East Africa taking advantage of Tier 2 country, upgraded from the 2018 Tier 2
porous borders. Watchlist rating. The 2019 Trafficking in Person
 Report22 advised that “human traffickers exploit
According to the US Government (OSAC19),
 domestic and foreign victims in Seychelles.
the Seychelles suffers from the highest rate of
 Traffickers exploit some Seychellois girls and,
heroin abuse in the world; nearly 10% of the
 according to some sources, boys in child sex
working population is addicted to heroin,
 trafficking, particularly on the main island of
according to the Agency for the Prevention of
 Mahe; peers, family members, and pimps
Drug Abuse and Rehabilitation (APDR).
 exploit them in bars, guest houses, hotels,
Importation of Afghan heroin is difficult to
 brothels, private homes, and on the street.
stop, given the porous nature of national
 Young drug addicts are vulnerable to sex
borders in a country comprising more than
 trafficking, and sex traffickers have exploited
100 islands. The popularity of synthetic drugs
 Eastern European women in hotels. In 2017,
is also on the rise. Police have increased there were reports of possible high-level
enforcement of drug trafficking and drug corruption, which allowed wealthy citizens from
abuse since 2016. Authorities strictly enforce Gulf countries to coordinate the travel of young
drug possession laws. Penalties for possession women aboard private planes, some of whom
of any amount include fines and possible jail may have been trafficking victims. Traffickers
time. may subject Malagasy women who transit the
 Seychelles - Threat Assessment - 2020 Page 14 of 35

Seychelles to forced labor in the Middle East. According to the 2018 Global Study on
However, the government still does not Smuggling of Migrants23, “The authorities of
acknowledge the occurrence of sex trafficking Madagascar report smuggling of migrants out
in Seychelles. Migrant workers—including from of the country. This smuggling activity is
Bangladesh, India, China, Kenya, Madagascar, directed mainly to the countries of the Gulf
and countries in South Asia—make up 20 Cooperation Council, as well as to other
percent (21,000) of the working population in countries in the Middle East. This smuggling
Seychelles and are primarily employed in flow makes use of the Comoros, Seychelles or
fishing, farming, and construction; credible Mauritius as transits to the final destinations.”
reports indicate traffickers subject migrant
 5.8 Goods Piracy: According to the Trends in
workers to forced labor in these sectors. NGOs
 Trade & Pirated Goods Report 201924 by the
report migrant workers also face exploitative
 EUIPO & OECD, 3.3% of world trade in 2016
conditions in fish processing plants, and
 was made up from trade in counterfeit goods.
fishermen aboard foreign-flagged fishing
 Seychelles is estimated as having a low
vessels in Seychelles’ territorial waters and
 propensity to export counterfeit products with
ports are subjected to abuses indicative of
 a score of 0.000/1 (2016) with export trade to
forced labor, including nonpayment of wages
 the rest of the world & for export trade with the
and physical abuse. Labor recruitment agents
 EU at 0.000/1.
based in Seychelles will exploit migrant
workers in labor trafficking, oftentimes with the According to a local media agency25 in 2018,
assistance of a local Seychellois accomplice. the Cabinet of Ministers in Seychelles
Migrant workers often sign their employment “approved procedural guidelines for border
contracts upon arrival in the Seychelles and measures to deal with infringement and
frequently cannot read the language, which counterfeit goods entering the country”. There
increases their vulnerability to fraudulent is acknowledgement on the part of the
recruitment tactics. There were reports of government that there is “an element of
employers routinely retaining migrant workers’ importation of counterfeit and infringing
passports to prevent them from changing jobs goods, and as such, it is important that we take
prior to the expiration of their two-year necessary steps to facilitate its control”. The
contracts, increasing their vulnerability to director general at the Trade Division in the
forced labor”. Ministry of Finance has further advised that “It
 needs to be noted that the provisional law only
There was insufficient statistical records and
 applies to marks and brands that have been
systematic data collection to include the
 registered in Seychelles and to importation that
predicate offence of human trafficking in the
 are being done on a commercial basis. If
NRA.
 somebody is coming with it in their baggage
 allowance, that will not be covered”.
 Seychelles - Threat Assessment - 2020 Page 15 of 35

5.9 Theft /Stolen Goods and Smuggling: and Madagascar, cigarettes are smuggled
According to the NRA, smuggling is rated using containerized sea freight and air cargo”.
“Medium” and was one of the predicate The Seychelles case studies in the report
offences that generating the most proceeds of highlighted the following techniques used to
crime. Unfortunately, due to a lack of statistics, smuggle the cigarettes:
no granular information was provided. The
 • Cigarettes were contained in large items
NRA documents the recommendation that
 such as speaker casings and air
“checks and controls are strengthened at the
 conditioning units delivered through air
different points of entry to detect, investigate
 cargo. The total amount of cigarettes
and take enforcement actions against
 seized by Customs totalled 59,200 sticks.
individuals involved in smuggling of goods”.
 An aircraft engineer was involved;
The NRA further highlights that due to
 • A frequent traveler attempted to smuggle
resource and technology restraints that
 7,400 sticks of cigarettes in his luggage
customs officials are unable to screen for cash
 through the airport; and
at Seychelles entry points.
 • A traveler attempted to smuggle 2,400
 Theft and smuggling rated “Low”
 sticks of cigarettes in chocolate and
 NRA 2017
Theft was rated as “Low” in the NRA, saying cornflakes boxes in his luggage through
that “From statistics provided by LEAs, petty the airport.
theft is prevalent in Seychelles but this offence
 The value of cigarettes smuggled/laundered
does not generate substantial proceeds of
 was USD$ 384,299.
crime in comparison to other predicate
offence”. 5.10 Financial Fraud: The NRA links fraud,
 counterfeit and forgery into a single category.
This view is echoed in the 2019 OSAC
 Using statistics provided in relation to fi nancial
Report26 which advised of “a decrease in
 services, fraud risk was rated as “Low”. “From
incidents of petty theft, burglary, robbery, and
 reported cases on fraud, it was indicated by the
other crime of opportunity. In 2018, robbery
 Police that the types of fraud perpetrated in
and burglary cases decreased by 45% and 17%
 Seychelles that generate substantial proceeds
respectively compared to 2017”, according to
 of crime are perpetrated by foreigners who
police statistics. Theft from vehicles was also
 operate in groups. Recently there has been an
noted in areas frequented by foreigners.
 increase in such groups coming into Seychelles
In the 2018 ESAAMLG Report27 on Smuggling focusing on ATM or skimming related fraud,
of Cigarettes and Associated Money fraud over the internet and cyber-crime.
Laundering in the ESAAMLG Region, they According to the Police, these represent 90% of
highlighted that “In the case of the Seychelles cases reported over the period under review. It

 Seychelles - Threat Assessment - 2020 Page 16 of 35

is seen that 95 % of those cases, with fraud which makes it a very desirable country to
cases over the internet, the fraud is initiated in register companies in and funnel profi ts
countries such as South Africa, Ghana, Guinea through. This makes it very appealing to
and Nigeria and the funds are transferred to syndicates and groups involved in organised
those countries though Money Services crime, especially those based relatively close in
Bureaus. East Africa and on the Asian subcontinent.

Fraud is perpetrated by foreigners who The EU lists Seychelles as one of the top 30
 operate in groups non- cooperative tax jurisdictions, though the
 NRA 2017 country has committed to reforms to become

According to the NRA, “the predicate offence tax-compliant. The formal labour market is not

representing the most proceeds of crime is fully established, which allows exploitative

company fraud with a total value of USD 2.4 practices – particularly involving foreign, often

million. This figure was obtained from the smuggled, labourers – to persist.”

Police and the elements of company fraud
 “Partially compliant”
were not broken down further”. For the 2014 to OECD Peer Review Report 2020
2015 period, the NRA documents 19 cases
 The OECD Global Forum on Transparency and
reported under the category of “Fraud /
 Exchange of Information for Tax Purposes
Forgery” ,and 5 cases under “Company Fraud”.
 published a Peer Review Report for Seychelles
In a media release28 in February 2020, the in April 202029, and rated Seychelles as
Central Bank of Seychelles and Seychelles “Partially Compliant”. Seychelles had previously
Bankers Association warned of an increase in been rated “Non-Compliant” in 2013 “because
in the number of scams and people falling of serious gaps in the enforcement of
victims to them through social media provisions on the availability of ownership and
platforms. These included phishing, spoofing, accounting information in the offshore sector”,
takeover scams, Ponzi schemes, romance as well as difficulties in entering into exchange
schemes, lottery scams, pyramid schemes and agreements Seychelles - as reported by Global
fake loan scams. “Individuals and local Forum members. In 2015, the Seychelles
business persons have also been impacted by improved significantly enough to secure a
the scams, most of which are thought to “Largely Compliant” rating.
originate from the Western Africa region,
 The drop in rating to “Partially Compliant” in
namely, Ivory Coast, Benin as well as South
 2020 was attributed to failure to reply to 88%
Africa and Nigeria, as the majority of payments
 of requests for accounting information and
are remitted to such countries” .
 62% of the requests for beneficial information
5.11 Tax Evasion: According to the 2019 OC over a three year period. The main concerns
Index, “Seychelles is a well-known tax haven, were highlighted as “the overall effectiveness

 Seychelles - Threat Assessment - 2020 Page 17 of 35

of supervision and enforcement activities to • Other custom related offences.
ensure the availability and access to
information in practice. Of particular concern is Tax evasions “Medium High”
 NRA 2017
the fact that while more than half of the
approximately 200 000 international business In the 2014 - 2015 period, the ESAAMLG
companies are currently struck off, the Mutual Evaluation Report (MER) noted only
effectiveness of this procedure remains recorded four reported cases of tax evasion
uncertain, since struck off companies maintain valued at USD$ 32,000. According to the
their legal personality and can be restored for a
 MER, tax evasion is not recognised as a
period of up to 12 years.”
 predicate offence under the Seychelles laws,

 Tax Evasion - Medium High however banks have being identifying
 NRA - 2017 business transactions routed through personal
 accounts to avoid taxes due. Seychelles has
The NRA rates tax evasion as “Medium High”,
 information exchange agreements with
and stated that “The statistics provided by SRC
 multiple countries and is also a party to the
in respect of reporting, investigating and
 Multilateral Convention on Mutual
prosecuting of tax evasion cases is insufficient
 Administrative Assistance in Tax Matters. “The
to determine whether this is a real issue for
 Tax and Customs Department liaise with the
Seychelles”. The NRA refers to suspicious
 World Customs Organization and through
transaction report statistics that highlighted the
 Double Taxation Agreements (DTAs) in relation
“prevalence of personal accounts being used
 to tax matters, which may be predicate offences
for business purposes potentially as a
 to ML and TF”.
mechanism to evade tax and large out of the
norm cash transactions being paid by owners According to the US Government (OSAC30),
of legitimate businesses for purchase of other Seychellois enjoy a lower tax rate due to the
assets in Seychelles including land”. offshore financial services industry’s significant
Mechanisms used for tax evasion are: economic contributions to the country, which
 has the second highest per capita income in
• Non-registration or non-remittance of tax
 Africa. The flexibility of the international tax
 due to the State;
 system and the lack of legislation concerning
• Understatements of income, and/or high-value transactions have enabled
 overstatement of deductible expenditure; international crime organisations to engage in
 money laundering using these offshore
• An element of forgery where records are
 industries.
 falsified;

• Transfer pricing; and

 Seychelles - Threat Assessment - 2020 Page 18 of 35

5.12 Emerging Threats: Cybercrime: present a low risk to Seychelles fi shing lanes
According to the 2018 Global Cybersecurity and tourism, as they no longer have the
Index (GCI)31, Seychelles scored 0.259/10 and capacity to operate so far east. In 2010, in the
is described as having a “Low” level of last reported incident, six Seychellois were
commitment rated 110th globally out of 175, captured by pirates southeast of the island of
and 20th out of 44 in Africa in terms of Mahé, but the government has since
cybersecurity. implemented a military strategy with EU and
 US support, and improved its legal framework
 Low level of commitment to dealing with piracy offenders”33. Seychelles is
 cybersecurity
 considered have “some of the world’s leading
 Global Cybersecurity Index 2018
 expertise at this point in terms of the
According to the NRA, the Department of mechanics of actually taking a piracy case from
Information & Communications Technology wherever — anywhere on the high seas — to trial
(DICT), has started to put in place the and all the way through to prosecution,
Government of Seychelles Cyber Emergency conviction, appeal and the eventual
Readiness Team (GOS CERT) (with equipment / imprisonment”34
training obtained from a COMESA project). It is
 5.14 Other Crime Threats: According to the
envisaged in the near future to place
 US Government (OSAC35), there is “minimal
dedicated people to man the GOS CERT.
 risk from crime in Seychelles,” and according
However, the 2019 OSAC Report32 states that to official police figures, “there continues to be
“Seychelles does not have an officially a decrease in violent crime, but there has been
approved national cybersecurity roadmap or a slight increase in incidents of petty theft.
internationally recognised Computer Incident Burglary, robbery, and other crimes of
Response Team. The government has created opportunity have also decreased.”
several legal measures in recent years (e.g.
 5.15 FCN Overall Country Threat Ratings:
Computer Misuse Act, the Electronic
 Seychelles is rated the 4/40 in SSA and 2/10 in
Transactions Act, and the Data Protection Act)
 East Africa, with an overall “Very Low” Threats
in an effort to address cybersecurity issues. The
 score of 83/100.
country signed agreements with India and
Cyprus in 2018 to bolster cybersecurity, but has
not implemented wider security measures on
public systems”.

5.13 Maritime Piracy: Seychelles is probably
one of the most secure countries in Africa and
confl ict and terrorism risks are low. Somali
pirates pushing out across the Indian Ocean
 Seychelles - Threat Assessment - 2020 Page 19 of 35

Section 6 - Sanctions & Terrorism

In this Section 6, the focus is on Sanctions and According to the NRA, “the potential threat
Terrorism threats. level in respect of TF risk is rated as “Low” as
 there are no reported cases to date of TF in
6.1 Sanctions: Seychelles is not subject to
 Seychelles “other than the alleged case of the
international sanctions. The 2019 Peddling
 graphite shipment to Iran”, where an individual
Peril Index36 (PPI), focussed on proliferation,
 was prosecuted and found guilty in
prepared by the Institute for Science and
 Germany42.
International Security, which classifies
Seychelles as a Tier 3 country (lowest threat), There are no known cases of funds
and a country with a “Moderate” controls score generated in Seychelles being used to
of 426 out of 1,300 points, and ranked 106th finance terrorism domestically or
among 200 countries. abroad, and no known cases of
 Seychellois foreign terrorist fighters.
 Tier 3 Country - Moderate level of NRA - 2017
 Controls
 PPI - 2019 The NRA further advises that “there are no
 known cases of funds generated in Seychelles
Seychelles has an embassy in Cuba, but does
 being used to finance terrorism domestically or
not have embassies for North Korea, Syria, Iran
 abroad, and no known cases of Seychellois
or Cuba in Seychelles37. According to North
 foreign terrorist fighters. Internationally,
Korea in the world38, Seychelles does not have
 Seychelles is also perceived as a low-risk
any bilateral relations with North Korea.
 jurisdiction in the terrorist financing context.
There are 8 entries, all entities, listed by US From a geographical perspective, the main TF
OFAC with addresses in the Seychelles39. threat, if any, would most probably emanate
 from Somalia, Madagascar and Yemen where
6.2 Terrorism / Extremism: Seychelles is not
 there is evidence of terrorism and deficiencies
included in the 2019 Global Terrorism Index40
 in AML/CFT emanating from a lack of robust
2019 or in the 2019 US Department of State
 institutional control. Controls are in place in
Country Reports on Terrorism41.
 Seychelles to mitigate these risks”.

 No terrorism and TF cases in According to the 2018 FATF Mutual Evaluation
 Seychelles, nor has there been any TF Report43, “Seychelles has demonstrated a good
 cases in which a Seychellois was understanding of the country’s low TF risk
 involved profile.
 FATF MER 2018

 Seychelles - Threat Assessment - 2020 Page 20 of 35

Seychelles Higher (Inherent) Risk Factors

 Customer Sector Geography
 Risks Risks Risks

 Customers with elevated Banks (in particular retail and Major export / import partner
 exposures to criminal activities corespondent banks) countries (trade mispricing via
 such as: IFFs).
 drug trafficking,,illegal fishing, Boat and yacht dealers, money
 human trafficking remitters, casinos, dealers in Piracy in waters with threats
 & people smuggling, fraud, precious metals & stones, forex from Somalia
finance & along with corruption dealers, real estate & lawyers,
 (e.g PEPs) which also help test and company service E Africa and Asia (source
 facilitate these crimes & tax providers, country drugs), Afghanistan, E
 evasion as a high risk concern Africa, Madagascar,
 also & Mozambique and South Africa
 (Seychelles used as trans-
 to Higher Risk Sectors and/or Motor vehicle dealers (very shipment point for drugs),
 Geography Risks high)
 A Sri Lanka (illegal fishing, ).

 Bangladesh, India, China,
 Kenya & Madagascar (modern
 slavery)

 Seychelles - Threat Assessment - 2020 Page 21 of 35

Section 7 - Money Laundering

In this Section 7, the focus is on Uganda’s • Commercial banks with operations in the
vulnerability to money laundering. international financial centre space;

7.1 Higher Risk Areas: Higher risk areas • Luxury real estate;
(including from the NRA) are set out below. In
 • Dealers in motors vehicles, yachts and
many cases a single risk factor may not be
 boats;
evidence of actual higher risks.
 • TCSPs in the international financial centre
 Seychelles Higher (Inherent) Risk Factors
 activities; and
 Customer Sector Geography
 Risks Risks Risks

 Customers with elevated Banks (in particular commercial Major export / import partners
 • Bureaux de change
 exposures to criminal activities banks with international (trade mispricing via IFFs)
 such as: business - offshore links
 drug trafficking, and
 Luxury real estate;
 Drug trafficking threat from -
 Afghanistan Pakistan, SE Asia
 In 2017, the MER documented that “Banking
 smuggling, company fraud,
 and Western Europe, as source
 fraud/forgery, theft & robbery
 along with corruption (e.g
 Dealers in motors vehicles, and destination countries. Also dominates the financial sector in Seychelles,
 yacht’s and boats; trans-shipment point for heroin
 PEPs) which also help facilitate
 these crimes & tax evasion as a TCPS - international / offshore
 for East Africa including Kenya
 Madagascar, Mozambique and and, as a result, the majority of transactions are
 business South Africa and from Dubai to
 high risk concern also to Higher
 Risk Sectors and/or Geography Bureaux de change.
 Seychelles - (heroin).
 conducted through it. In 2016, banking
 Risks Migrant workers including from
 Bangladesh, India, China, comprised nine (9) commercial banks, of which
 Kenya, Madagascar, and

 seven (7) were either owned or controlled by
 countries in South Asia - some
 have working conditions akin
 to forced labour

 Illegal Fishing - China
 international financial groups. Only two (2) of
 TF Threat from - Somalia, the seven (7) commercial banks engage in
 Madagascar and Yemen

 international business activities. This means
According to the NRA, there was “missing”
 that the risks of ML/TF in the international
information that was not available for the NRA
 business sector appear to be concentrated in
exercise, but nonetheless highlighted that the
 the two commercial banks. The total assets
cash intensive economy, rapid advances in
 value of the banking sector in 2015 was
information technology, reputation as an
 estimated at USD1.13 billion. The total profit for
offshore haven, improper use of Trust and
 banking in the same period amounted to US 33
Company Service Providers (CSPs), and
 million. In the foreign currency market, money
deficiencies noted within the law enforcement
 business services providers (bureaux de
agencies were all concerning areas.
 change) transactions were valued at SCR 1.23
The MER highlights inherent ML/TF threats billion compared to SCR0.33 billion conducted
“emanating from being an international by banks in 2015. It represents about 78
financial centre, most notably in relation to percent and signals its importance to the
drug offences”. Sectors identified as being economy of Seychelles”. The NRA rated the
vulnerable to ML/TF risks are: financial sector an overall rating of “Medium”.

 Seychelles - Threat Assessment - 2020 Page 22 of 35

7.2 Cash Based Money Laundering: 7.5 Cryptocurrency risks: According to the
According to the NRA, Seychelles is a “cash 2019 Financial Intelligence Unit Annual
intensive economy”. Using data from 2015, the Report45, “in recent years, the country has
NRA estimates that that the total proceeds of attracted financial companies in the business
crime from undetected sources combined for line of virtual asset. According to the website
all the predicate offences identifi ed was SCR coinlore listing, there are currently four
230,351,730 (USD$18,428,138). The buying Seychelles registered IBCs in the top 10 list in
and selling of forex as well as remittances are the crypto exchange by 24-hours volume, with
to be a Medium High risk, due to the cash BITFOREX topping number one in terms of
intensive nature of their activities. In relation to volume.…The Seychelles offshore sector has
tax evasions “large out of the norm cash also experienced a rise in the registration of
transactions being paid by owners of legitimate Crypto IBCs”.
businesses for purchase of other assets in
Seychelles including land”. See see Section 9.7 “The 2020-Crypto crime report by Chainalysis
for more information on cash threshold indicates that in 2019, 24.7% of illicit bitcoin
reports. exchange transaction was done through
 Seychelles registered IBC. In 2019, the
7.3 Trade Based Money Laundering: Whilst
 Seychelles FIU received crypto related STRs on
cash based money laundering is a popular
 a regular basis and analysis are being
method for laundering funds, trade based
 conducted.The primary areas of criminal
money laundering is likely to be prevalent due
 activities in cryptocurrency of concern to
to use of offshore companies and international
 Seychelles are tax evasion, money laundering,
shipment routes. Seychelles is positioning itself
 ICO scam, contraband transactions Terrorism,
to benefit from enhanced regional trade as
 theft and extortion.In view of the inherent risk
Africa is moving toward the creation of the
 associated with crypto currency, the Seychelles
African Continental Free Trade Area. A multi-
 FIU is working towards building its capacity to
million dollar expansion and modernisation of
 better regulate and strengthen its internal
Port Victoria is expected to create a regional
 system to detect and deter financial crimes
transshipment and trading hub, according to
 through the use of new technologies”.
the CEO of the Seychelles Port Authority44.
 7.6 Other Money Laundering: Securities and
7.4 Mobile Money Risks: Although mobile
 transaction laundering are also important
payment services are designated as reporting
 methods, however laundering through the
institutions, very little information could be
 securities is considered to be “Low” in
found in relation to risks identifi ed in
 Seychelles.
Seychelles, other than the input of cash at
agents.

 Seychelles - Threat Assessment - 2020 Page 23 of 35

Seychelles - Threat Assessment - 2020 Page 24 of 35

Section 8 - Illicit Funds including Estimated Criminal Proceeds

In this Section 8, the focus is on Malawi’s made up of criminal activity, a significant
vulnerability to Illicit Financial Flows and illegal proportion will be.
Proceeds and to the laundering of criminal and
 According to the sources and analysis carried
other illicit funds.
 out in this Threat Assessment, estimates for
According to the African Union46 based on criminal proceeds, laundered funds and funds
work and data provided by GFI, it is estimated generated by corruption and organised crime,
that Seychelles suffered from illicit financial amongst others, are estimated in the following
flows from 2004-201347, averaging US$36 ranges:
million a year, and US$72 million48 in 2017,
 •Total estimates for
according to Global Financial
 Total Criminal Proceeds in Sub criminal proceeds
Integrity49 (GFI), to have left the Saharan Africa in US$ Billions -
 combined of 4.5 to
country. FCN 2020 (not including fraud and
 corruption and tax evasion) 7.5%68 of GDP and with
Seychelles has a Tax to GDP ratio
 5 - 10%69 of this
of 29.2%50, which is the 2nd Mining
 10
 Fishing
 estimated as costs of
highest in Africa, and above the Wildlife
 2.5

 2 Goods Piracy
 corruption.
average African figure of 16.2%, 9

and rated across Africa as a “High” Logging
 12.5 •Total estimates for
Tax Collection Country. Modern Slavery
 8.3 monies available for
 Drugs
 laundering through the
According to GFI, the most Theft
 3
 15
 formal sector is 70 -
common method for transferring
illicit financial funds, is through 76%70 of criminal

trade mis-pricing. GFI believe this proceeds and 24 -

method or series of techniques may represent 26%71 involving organised crime, with most
up to 80%51 of illicit financial flows, and can significant criminal actors being “Foreign
involve abusive and or aggressive transfer Actors” followed by “Criminal
pricing, trade mis-pricing and mis-invoicing, Networks” ,“State Embedded Actors”, and
for example intentionally overpaying for “Mafia Style Groups”.
imports of goods or services (or underpaying
 The largest criminal markets in Seychelles will
for exports or services) is a straightforward way
 include drug trafficking, tax evasion,
of illegally transferring monies out of a country.
 smuggling, corruption, company fraud, fraud/
The risks increase in trade with so-called forgery, theft & robbery and those crimes

advanced economies. Whilst not all IFFs are identified as the largest markets across Sub-
 Saharan Africa (see Pie Chart above).

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