Cabinet has approved the Anti-Money Laundering and Combating of Terrorism Financing Amendments Bill, 2023, which seeks to ease the rules governing cash transactions of at least Sh1 million, reducing the requirement for customers to disclose details on the source, use, and beneficiaries.
As it stands, the law mandates commercial banks to report all transactions above Sh1 million to the Financial Reporting Centre (FRC) on a daily basis. The Bill, set to be tabled in parliament, aims to increase the reporting threshold by 50 per cent, a move that is mounting pressure from international companies on the government to combat money laundering.
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President Ruto’s recent meeting with Brian Nelson, the US Under Secretary of the Treasury for Terrorism and Financial Intelligence, focused on reinforcing anti-money laundering measures and countering terrorism financing frameworks. Discussions also covered Treasury assistance in enhancing capacity for tackling financial crimes.
President Ruto has reiterated the need for firm regulatory and administrative enforcement, and previously said that tracking the source and flow of illicit funds would bolster integrity and stability in the financial system, subsequently driving economic growth.
The Anti-Money Laundering Bill, sponsored by Majority Leader Kimani Ichung’wa, seeks to impose substantial fines for violations related to money laundering and terrorism financing. Legal entities found in violation could face penalties not exceeding Sh20 million, while persons may be fined up to Sh1 million, with an additional Sh100,000 for each day of non-compliance.
The Bill grants the police authority to allow prohibited or suspicious consignments to pass through and into Kenya’s territory to facilitate investigations and identify individuals involved in criminal activities.
Furthermore, the amendments will push banks and financial institutions to conduct rigorous due diligence on both new and existing customers.
As the proposed amendments to the Anti-Money Laundering and Terrorism Financing Bill make their way to parliament, the government aims to tighten its grip on financial crimes. The measures introduced are expected to strengthen Kenya’s commitment to combating money laundering and terrorism financing, ensuring greater financial security and integrity for the nation.