EXPERT COMMENT: Bad guys always coming up with ways to beat a good system


How were suspected terrorists able to transact and move huge sums of money through banks and mobile phone money platforms? I don’t want to apportion blame. At this juncture that should not be our target. We should focus on understanding the nature of the problem and how to address it, rather than apportioning blame among various parties.

For illicit financial flaws, money laundering and terrorist financing, we have a framework governed by the law to cushion the country. We have the Proceeds of Crime and Anti-Money Laundering Act and a number of entities that are supposed to be reporting within the framework. We have financial institutions, we have non-financial businesses and professions.

With that framework, anything out of ordinary should be reported to the right entity — the Financial Reporting Centre, which then has the right to act.

On who should play which role, there are so many parties involved in the Anti-Money Laundering (AML) and Countering Financing of Terrorism (CFT) framework with specific responsibilities. We have law enforcement authorities, regulators of reporting institutions and a multi-agency task-force.

With all these laws and institutions in place we will always have challenges because as we tighten the laws, these guys are always coming up with new ways to beat the system, the AML and CFT. You have to continuously keep reviewing the system and putting in additional measures to ensure new approaches are thwarted. The issue is to remain alert.

The Financial Action Task Force (FATF) is the body responsible to ensure the whole regime globally is safe from risks. Under the task force, there is the Eastern and Southern Africa Anti-Money Laundering Group, whose role is to continuously review institutions under its jurisdictions to ensure compliance with international norms. They have a continuous review of the system to ensure they are up to date and ensure that not only do we have laws but also the implementation enforcement of those laws are effective.

In Kenya, we have passed the stage of putting the laws in place and now will test the effectiveness of those laws. We are doing a national risk assessment to ensure we focus on high-risk areas.

The CEO of the Kenya Bankers Association poke to the Star

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