Kenya Risks FATF Sanctions on Cash Handling Rules

Kenya’s reputation is on the line as the country risks being considered a money laundering hub. This is a result of the parliament’s failure to amend the crime and Anti-money laundering Act.

The proposal was aimed to ensure addition of notaries, lawyers and other independent legal professions as members of reporting entities who by law are required and expected to be controlled by Anti-money laundering act.

Issues covered under the Anti-money laundering laws and regulations are inclusive of; regulatory, criminal enforcement, enforcements by administrations, financial institution requirements and other designated businesses in 31 jurisdictions.

Financial Reporting Centre (FRC) boss, Saitoti Maika, issued a warning on Tuesday saying that Kenya stands the risk of being cited for its own non-compliance resulting to sanctions by the Financial Action Task Force (FATF).

FATF is an inter-governmental body which is solely responsible for the setting of standards which are aimed at ensuring the effective implementation of regulatory, operational and legal measures aimed at fighting against money laundering and terrorism financing.

Mr Saitoti implied that whenever the FATF organization discovered that a country is not doing a good job at implementing the standards set aside by FATF, it has the full authority to contact the international community with the aim of having it apply the appropriate counter-measures on that country.

The FRC also added that as a country, Kenya stands the risk to be singled out as a jurisdiction of high risk and to top it off, a country which safely harbors money laundering. According to him, this would have adverse effects on the markets’ financial sector reputation.