The International Monetary Fund (IMF) wants tighter checks on bank transactions in Kenya amid growing concerns about money laundering by corruption networks.
An appraisal report by an IMF team said Kenya should intensify checks on corruption-related money laundering risk in banks and other higher-risk sectors using financial intelligence tools.
“Anti-money laundering and counter financing of terrorism supervision should be intensified to mitigate corruption-related money laundering risk in banks and other higher risk sectors and make greater use of financial intelligence,” the IMF team said.
Kenya has lately witnessed an upsurge in suspected money-laundering schemes with billions of shillings seized from companies and individuals who could not explain the source of their wealth.
For instance, the State has this year seized about Sh15 billion from individuals and companies in Nigeria with the bulk of the money suspected to be from card fraud or remittance done by payment service providers.
The biggest cash seizure from the west African nation belonged to start-up firm Flutterwave with Kenyan authorities believing that the Sh6.2 billion in 62 bank accounts is part of card fraud and money laundering schemes.
The Asset Recovery Agency last December also seized about Sh108 million from a woman residing in Kiambu County on suspicion that the money was part of a money laundering scheme.
In court filings, the agency said Tebby Wambuku Kago together with an associate — Felesta Nyamathia Njoroge and a sister Jane Wangui Kago — received a total of Sh260 million from Belgian Marc De Messel between August and November last year through two accounts at Equity Bank. The Belgian, a cryptocurrency dealer, had indicated in the declaration documents that the money was a gift.
A recent report by the US State Department warned of laxity among Kenyan officials in the global fight against money laundering, with officials tipping suspects to move assets before seizure.
The annual International Narcotics Control Strategy Report (INCSR) suggested mobile lending platforms on Safaricom’s M-Pesa system such as Mshwari and KCB-M-Pesa were not closely regulated, while proximity to Somalia has made Kenya an “attractive destination for funds from unregulated Somali sectors.
A team from 19-country Eastern and Southern Africa Anti-Money Laundering Group (ESAAMLG) —the regional watchdog — is expected to issue an evaluation report on the effectiveness of Kenya’s financial systems and laws in fighting money laundering and terrorism financing in September.