WMLRO.Com: whisper it quietly - Kenya has at last passed a money laundering law
Kenya - the country where a minister once claimed he had a legal, statutory, right to participate in government contracts so as to make a profit because he was paid so little, has - after several years of haggling - at last passed a law to combat money laundering. Now for enforcement...
The Proceeds of Crime and Anti-Money Laundering Act and Arbitration (Amendment) Act is not the first Kenyan law dealing with this subject - but the previous one was so weak it was almost pointless. Like many countries, Kenya introduced provisions to meet its obligations under the Vienna Convention and therefore its money laundering provisions were restricted to proceeds of drugs trafficking. (1)
For example, the new law introduces, for the first time, the power to trace, freeze and confiscate assets suspected of being proceeds of criminal conduct.
For the first time, a properly constituted FIU will be formed: the Financial Reporting Centre.
Sentences have been increased: for laundering, jail for a maximum 7 years, a fine of up to 2.5 million shillings or both.
The Bill has been mired in controversy for years, in particular over the issue of whether corruption should be regarded as a predicate crime for money laundering purposes.
But Kenya has not been isolated: it has nevertheless "signed the twelve major international protocols related to anti-money laundering, corruption, trans-national crime and combating terrorism. Among them is the United Nations Security Council Resolution 1373 on combating terrorism and 1267 Sanction Committee that designates and issues lists of individuals or entities suspected to be linked to terrorism" and requires banks to have regard to those lists.
And although there is no full-scale FIU, there is a suspicious reporting procedure under which STRs are filed with the Director, Supervision at the Central Bank. Although the notes attached to the form relate to money laundering, the process is, in fact, more closely related to prudential supervision of the bank submitting the report than to a proceeds of crime objective.
(1. Chapter 245 Narcotic Drugs and Psychotropic Substances Control ACt, s49.)
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