Treasury wants companies to recruit anti-money laundering officers

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Treasury wants companies to recruit anti-money laundering officers

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Kenyans have until October 2, 5 p.m., to submit their comments on Regulation No. 10 of the Crime and Anti-Money Laundering Regulations, 2023. Photo|Shutterstock

The National Treasury now wants designated financial institutions and non-financial institutions to be staffed with anti-money laundering officers, as the government seeks to tighten the leash on illicit financial flows in the country.

This is provided for in Regulation No. 10 of the Crime and Anti-Money Laundering Regulations, 2023 issued by the National Treasury and for which Kenyans have until October 2, per 5 p.m. to submit your comments.

Designated non-financial institutions include casinos; Real estate agencies; institutions trading precious metals and precious stones; accountants practicing alone or as partners in their establishment; and non-governmental organizations.

Read: Casinos and saccos to register with anti-money laundering agency

“A reporting institution appoints a money laundering reporting officer. The money laundering reporting officer is at management level and must have the necessary and relevant skills, authority and independence. All personnel of a reporting institution must monitor and report to the money laundering reporting officer any suspicious activity relating to money laundering, terrorist financing and proliferation financing,” the regulations state.

This comes barely a month after President William Ruto signed the Anti-Money Laundering and Counter-Terrorism Financing (Amendment) Bill 2023 into law. The new law removes the Financial Reporting Center from the classification of a state corporation, a move that is expected to grant the center operational independence.

The new law also empowers the Capital Markets Authority and the Insurance Regulatory Authority to enforce the provisions of the law on their licensees, a move that broadens the scope of supervisory bodies in combating illicit financial flows in the country.

Under the proposed 2023 regulations, the money laundering reporting officer will report directly to the Financial Information Center. The regulations prohibit any managing director or internal auditor from being appointed responsible for anti-money laundering reports, except where the company is a sole proprietorship.

“The money laundering reporting officer must immediately report to the Financial Information Center any transaction or activity that he or she has reason to believe is suspicious in such manner as the Center may specify. When the Center receives a report from a money laundering reporting officer, it immediately acknowledges receipt,” the regulation states.

Strengthening anti-money laundering controls is a key part of Kenya’s ongoing program with the International Monetary Fund (IMF).

Read: The State will legalize telephone and electronic tapping in the fight against dirty money

“The end-June 2023 structural benchmark on draft amendments to address legal and regulatory gaps in the anti-money laundering and counter-terrorist financing framework is on track. The authorities plan to submit to Parliament by June a draft of legal amendments aimed at closing gaps in the AML/CFT framework to further support anti-corruption efforts,” the IMF said in its latest report.

The global money laundering and terrorist financing watchdog, the Financial Action Task Force (FATF), conducted an on-site visit to Kenya between January 31 and February 11, 2022.

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