The USAID-MCC Anticorruption Program in Timor-Leste, implemented by DI Development, a business of DynCorp International, works with the USAID-MCC Anticorruption Program in Timor-Leste, Foti Timor-Leste (FTL). On December 12, the country passed its first Anti-Money Laundering Law (AML), designed to combat the financing of terrorism (CFT).

Terrorists finance criminal activities by laundering money, so stopping this activity is on the top of a worldwide agenda to fight corruption. The failure of a country to prevent terrorists’ access to funds through money laundering can be met with formal and informal sanctions.

Serious Consequences

Among many other possible sanctions, countries that fail to establish an adequate AML could possibly suffer:

• Increased scrutiny by foreign banks

• Increased scrutiny by foreign law enforcement agencies

• Delay or rejection of bank account applications and international transactions

• Delay or rejection of membership in international trade organizations

A Call to Action

Aware of the pending threat to Timor-Leste’s reputation, USAID and the FTL Program began holding briefings to provide Timor-Leste’s political leaders with information on the benefits of a strong AML.

Next Steps

The National Parliament passed the AML and the resulting law is a critical piece of legislation that brings Timor-Leste into the international financial network and more aligned with international efforts to combat the financing of terrorism.

USAID’s FTL Program will continue to work with the National Parliament to further strengthen its anticorruption environment – helping the parliament exercise its fiscal oversight roles and further efforts to shut down money laundering opportunities. Expected priorities are likely to include tackling important legislation on politically exposed persons, extradition, and regulation of professions commonly used to facilitate corruption.

The USAID-MCC Anticorruption Program in Timor-Leste

DI Development, a business of DynCorp International, works with the USAID-MCC Anticorruption Program in Timor-Leste, a project funded by the Millennium Challenge Corporation (MCC) and administered by USAID. The program works in partnership with the Democratic Republic of Timor-Leste (“República Democrática de Timor-Leste” or RDTL).

The Program operates under the name Foti Timor-Leste (FTL), which translates in Tetum as “Raise up” or “Promote” Timor-Leste.

The purpose of the program is to reduce corruption by strengthening a network of effective anticorruption institutions and actors with the capacity to deter and detect corruption.