MONEY LAUNDERING, A GLARING EYE-SORE IN KENYA

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Rogue businessmen are dragging down the war against corruption in Kenya, through money laundering, turning the horn of East Africa into an attractive destination for dirty money.

The money-laundering vice is made possible by weak enforcement strategies and administrative loopholes that stand in the way of publicly declaring the companies supporting money laundering.

President Uhuru Kenyatta is keen on the anti-graft fight and has equipped the Multi-Agency taskforce to collaborate more through intelligence sharing, investigations, resources sharing and high-technology networks. Some agencies that have increased the vigour in this area include; KRA, ARA, DCI, EACC, among others. More however needs to be done to ensure that all loopholes are sealed especially in fighting money laundering.

An amendment to the companies Act 2015 section 93A, done in October 2020, ushered a possible way to victory by defining individuals in companies making transactions. This would expose individuals engaging in unscrupulous money deals, hiding behind company names. Nonetheless, the Act has been in operation but the beneficial ownership e-registrar documents are not accessible to the public.

Other than this, agencies dealing in the fight against corruption are not well equipped to fight the specific vice of money laundering. The Tax Justice Network Africa (TJNA) has therefore urged policymakers to create an allocation for such agencies, with the aim of supporting the fight against money laundering.

Intelligence records show that money laundering is rife in real estate and property sector, where highly connected and politically prominent people invest their money to release it to the economy, to unknowing citizens.

Money laundering and illicit financial flows is very rife around the electioneering period and there’s evidence to back this up. The KRA recently nabbed three foreigners, each with millions of shillings in foreign currency at the Jomo Kenyatta International Airport (JKIA) in separate incidents that took place, within two months. The foreigners were trying to bank the money locally and at some point board flights with the money; both attempts failed miserably, showing the seriousness in the Kenyan banking system and border control security.

Kenya, being the largest trading country in East Africa, has been mentioned by TJNA as the most central country, in helping foreigners hide money from the rule of law, even despite the tight banking and border security regulations. A study by the Financial security Index (FSI) shows that most money launderers are aided by prominent people in the government who can influence decision making.

The EACC, KRA, DCI and ARA collaborated in a crack-down incident in 2018 where the Attorney General reached out to seven nations seeking information about bank accounts and assets in the names of Kenyan citizens who were suspected to be dealing in proceeds of corruption.

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