President William Ruto during a Cabinet meeting held at Statehouse, Nairobi on July 18, 2023. The cabinet meeting approved the Anti-Money Laundering and Combating of Terrorism Financing Laws (Amendment) Bill 2023. PHOTO | PCS
Banks and agencies tasked with fighting money laundering must step up their efforts to protect the country from illicit financial flows in light of a Cabinet proposal to relax cash transaction disclosure rules.
The Anti-Money Laundering and Combating of Terrorism Financing Laws (Amendment) Bill 2023 seeks to increase the cash-reporting threshold from the current $10,000 (Sh1.42 million) to $15,000 (Sh2.1 million) to was approved by Cabinet and now awaits a parliamentary nod.
While relaxing the rules will be beneficial to businesses with large transactions in the face of a weakening shilling against the dollar, there remain fears that the move could aid money laundering and terrorism financing.
A 2022 survey by the Financial Action Task Force (FATF), the global money laundering and terrorist financing watchdog acknowledged Kenya’s progress in enhancing anti-money laundering frameworks such as setting up the Asset Recovery Agency and boosting resources of the Financial Reporting Centre.
But, despite the improvements, the task force found key weaknesses related to but not limited to different types of money laundering, cash and cross-border risks, types of legal persons, and politically exposed persons, among others.
These significant gaps cannot be ignored. They require urgent attention and decisive reforms for Kenya not to lose ground in the fight against the illicit flow of money.
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