The CEO of Kenya’s Ethics and Anti-Corruption Commission (EACC), Twalib Mbarak, has been meeting with US Federal Bureau of Investigation (FBI) officials at their Washington headquarters.
The meetings took place in the context of pressure for US agencies to work more closely with international partners in jurisdictions vulnerable to money laundering and growing concerns that Kenya is actually softening its anti-money laundering (AML) regime.
Kenya is one of the countries designated by Washington as a ‘major money laundering jurisdiction’, and a resolution has recently been put before Congress calling for US agencies to strengthen their work with all 80 of these countries (Trade-based Financial Crime, 3 January 2023).
Deeper cooperation
As a result of the Washington meetings, which included one between Mbarak and FBI director, Christopher Wray, the FBI affirmed its commitment to working closely with EACC, as well as Kenya’s prosecution service and other key actors to reduce the prevalence of corruption and illicit financial flows in Kenya.
According to an EACC statement, its discussions with the FBI included exploring opportunities to deepen cooperation in the fight against corruption and financial crime in Kenya.
“The discussions were centred around enhancing technical support in the investigation and prosecution of complex corruption cases,” the statement says.
Retrograde step
Kenya is vulnerable to money laundering, financial fraud, and terrorism financing, and it appeared to take a step backward recently according to the US state department’s International Narcotics Control Strategy Report, Volume II, Money Laundering.
It points out that in October 2021, President Kenyatta ordered the lifting of the large cash transaction reporting requirement.
Kenya is the financial hub of East Africa, and mobile banking far surpasses cash transactions in the formal economy, both of which increase the country’s vulnerability to money laundering.
TBML concerns
Money laundering in Kenya occurs in the formal and informal sectors, deriving from both domestic and foreign criminal operations, including trade-based money laundering (TBML); transnational organised crime; cybercrime; corruption; trafficking of drugs, illegal timber, charcoal, and wildlife; smuggling, and counterfeit goods, according to the US state department.
It says Kenya’s enforcement regimes are legally sound, but authorities lack the resources, and perhaps the will, to enforce them with vigour.
The US state department’s International Narcotics Control Strategy Report, Volume II, Money Laundering, which contains a full list of ‘major money laundering jurisdictions’, can be found here.
Categories: Trade Based Financial crimes News
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