Latest news with #suspicioustransactions
Zawya
4 days ago
- Business
- Zawya
Kenya fails to shake off EU money laundering grey list as Uganda is delisted
Kenya has been added to the list of high-risk jurisdictions for money laundering by the European Union, as Uganda got reprieve by being struck off the list. The EU released the updated list on Tuesday, as the Financial Reporting Centre (FRC), Kenya's Financial Intelligence Unit, raised the red flag on a number of suspicious transactions linked to money laundering. The FRC's latest annual report (2024) shows that the lenders and credit institutions in Kenya reported 94 transactions related to terrorism financing last year (2024), a 30.55 percent growth from 72 transactions reported a year earlier, while suspicious transactions related to money laundering increased by 18.73 percent to 7,193 from 6,058. The report further says that those lenders' total suspicious transaction reports increased by 18.85 percent to 7,287 from 6,131 during the period. According to the report, the number of suspicious transactions reported by capital markets and securities operators more than tripled to 93 from 26, with the suspicious transactions being solely related to money laundering. It's not clear if the EU based its decision on this report to put Nairobi on the list of high-risk countries which exhibit significant gaps in their anti-money laundering and countering the financing of terrorism frameworks. Grey-listing means that Kenya will now face increased scrutiny from EU financial institutions.'The Commission has carefully considered the concerns expressed regarding its previous proposal and conducted a thorough technical assessment, based on specific criteria and a well defined methodology, incorporating information collected through the FATF (Financial Action Task Force), bilateral dialogues and on site visits to the jurisdictions in question,' the EU said in its statement.'As a founding member of FATF, the Commission is closely involved in monitoring the progress of the listed jurisdictions, helping them to fully implement their respective action plans agreed with FAFT.'Other grey-listed countries are Algeria, Angola, Cote d'Ivoire, Laos, Lebanon, Monaco, Namibia, Nepal and Venezuela. Uganda, which was earlier on the list, has since been delisted, alongside Barbados, Gibraltar, Jamaica, Panama, Philippines, Senegal, and the United Arab Emirates. This means they had demonstrated improvement in their financial crime defences. Kenya was grey-listed in 2024 for failure to prosecute money laundering and terrorism financing cases. It was also cited for lack of regulations for cryptocurrencies, non-profits, and absence of a robust risk-based approach towards anti-money laundering and countering terrorist financing. The United States in 2023 warned Kenya against money laundering. In July 2023, Brian Nelson, US Department of Treasury's Undersecretary for Counterterrorism and Financial Intelligence, met and held talks with President William Ruto in which money laundering featured. Nelson raised concerns about Kenya's relations with countries blacklisted by the US, including Iran and Belarus.'If Kenya considers itself a US ally, Americans have certain expectations from Kenya. The reality is that the US would expect Kenya to support it by aligning to its policies,' Nelson said. In July 2023, Iranian President Ebrahim Raisi, who was killed in a helicopter crash in 2024, toured Kenya in a controversial state visit. Earlier, Kenya's then Trade minister Moses Kuria visited Belarus on a trade mission. Kenya's actions did not go down well with the Joe Biden administration, who dispatched Trade Representative Catherine Tai and Nelson to Nairobi in a span of two weeks. The US was concerned that it would encourage money laundering whose proceeds are used to fund terrorism in neighbouring Somalia. After Nelson's visit in 2023, President Ruto formed the Anti-Money Laundering and Combating Terrorism Financing Multi-Agency Team (AML/CFT MAT). This task force brings together institutions such as the Financial ReportingCentre, Central Bank of Kenya, Kenya Revenue Authority (KRA), Directorate of Criminal Investigations (DCI), and the Ethics and Anti-Corruption Commission (EACC) to coordinate investigations into illicit financial flows, particularly in public procurement and the financial sector. Parliament amended the Proceeds of Crime and Anti-Money Laundering Act to impose stiffer penalties for non-compliance, improve asset tracing mechanisms, and expand the range of businesses legally obligated to flag suspicious activity. And last week, the Director Investigations Bureau at DCI Abdalla Komesha, speaking at the Financial Investigations and Asset Recovery workshop at the Kenya School of Government in Nairobi, reaffirmed the directorate's commitment to investigating money laundering, terrorism financing, and major predicate offences, including organised crime.'Proceeds of crime are no longer hidden under mattresses; they are laundered through complex corporate structures, layered across global bank accounts, and concealed within real estate or cryptocurrency. As the landscape of criminality transforms, so too must our response,' he said. Despite the DCI's efforts, Kenya remains on the grey list, meaning they are yet to bear fruit. Experts blame corruption, partly blamed for the delay in prosecution of cases. The country is also witnessing politicians dishing out huge amounts money in public functions, whose source cannot be determined, given that President Ruto banned harambees as a measure to stem corruption. A legislator, Njeri Maina, questioned how leaders gave out such huge amounts in donations while public sector services such as education were wallowing in a financial crisis.'So we can donate Ksh145 million ($1.12m) but we lack free education, investing in local manufacturing to create job employment opportunities for our young people is where we draw the line,' said Maina, who is the Kirinyaga Woman Representative. © Copyright 2022 Nation Media Group. All Rights Reserved. Provided by SyndiGate Media Inc. (
RNZ News
06-06-2025
- Business
- RNZ News
Auckland foreign exchange firm fined over $1 million
Photo: 123RF An Auckland foreign exchange company has been convicted and fined $1.125 million for failing to report suspicious activities and submit financial transparency reports relating to money laundering. Qian Duoduo Ltd, which trades under the name Lidong Foreign Exchange, failed to report 197 international transactions to China between 2018 to 2019, a Department of Internal Affairs investigation has found. Of these transactions, 26 involved suspicious activities and 171 involved prescribed transactions, totaling more than $19 million. The transactions were made by two individuals, Xiaoyu Lu and Musabayoufa Fuati, who have both been convicted of criminal offending involving money laundering. The District Court found the company failed to carry out adequate customer due diligence about the source of the pair's funds, relying on questionable documents despite recognising its operations were at high risk of being used to launder money. Serge Sablyak, director of anti-money laundering and countering financing of terrorism at the Department of Internal Affairs, said the department took offences under the Anti-Money Laundering and Countering Financing of Terrorism Act "very seriously". "Suspicious transactions have the potential to be linked to money laundering or terrorist financing activities," Sablyak said. "Prescribed transaction reports are vital in alerting law enforcement to suspected offenders and make money laundering and terrorist financing difficult to hide." Sablyak said Qian DuoDuo Ltd had a history of non-compliance. "In 2017, the department took civil action against the company following non-compliance with its obligations, and the High Court confirmed multiple breaches of the company's legal obligations," Sablyak said. "When financial institutions, including money remitters, continue to fail to meet their obligations under the Act, the department can and will take action." Qian DuoDuo Ltd has appealed the District Court's decision in the High Court.
