Establishing a cybercrime specialised unit and a training department for prosecutors on handling financial crimes and asset recovery is one of the measures Uganda has come up with to combat illicit financial flows.

Jane Frances Abodo, who assumed the office of the Director of Public Prosecutions (DPP) on April 22, 2020, said with speedy communication and automation, digital technologies facilitate illicit financial flows at all stages of money transfer and use — placement, layering and integration.

“The DPP, cognisant of this fact, set up a specialised cybercrimes unit in 2020 to fast track the investigation of such offences. We also have capacity building for prosecutors,” Abodo said.

She said her office had continuously trained prosecutors in the changing techniques that are used by criminals in committing financial crimes.

“Prosecutors have been trained to handle financial crimes and asset recovery. To ensure focused and needs-based training, the office of the DPP has a department which spearheads training for its prosecutors,” Abodo said.

What reports say

According to Global Financial Integrity, a Washington-based organisation, illicit financial flow is the movement of money and value that is illegitimately earned, transferred and or utilised from one country to another.

A recent report by the Economic Commission for Africa on illicit financial flows estimates that the African continent has lost over $1 trillion in illicit financial flows over the last 50 years — a sum roughly equivalent to the official development assistance received by African countries over the same period of time.

The 2021 study, titled Illicit financial flows risk factor in Uganda’s oil and gas sector, authored by the Civil Society Coalition on Oil and Gas in Uganda,  indicated that Uganda could be losing sh2 trillion in illicit financial flows per year.

Abodo also said they had established and maintained a good working relationship with law enforcement agencies, which provide them with vital information that is required in tracing crime proceeds, leading to successful prosecution of financial crimes.

Such offices include the Inspectorate of Government (IG), Uganda Revenue Authority, Financial Intelligence Authority (FIA), the Uganda Police Force, Bank of Uganda and the National Information Technology Authority Uganda (NITA-U).

“The office of the DPP signed a memorandum of understanding with FIA, NITA-U and we have the DPP-Criminal Investigations Department (CID) coordination committee, which sits on a quarterly basis. The committee members are senior CID officers and the office of the DPP,” Abodo said.

Over sh30b recovered

Abodo also said after realising that financial crimes are motivated by profit, her office upgraded the Asset Recovery Division established in July 2015 to a department in 2019.

“Its responsibility is to ensure effective recovery of crime proceeds through execution of compensation orders that are issued by courts. Over sh30b has been recovered by the department and banked on the Asset Recovery Account that is maintained in Bank of Uganda,” she said.

Challenges

Abodo said the use of sophisticated means to conceal, disguise and move illicit finances is one of the challenges they are facing in the fight against illicit financial flows.

“The latest being used now is cryptocurrency. This creates challenges for detection as cryptocurrencies operate and thrive on anonymity. The second challenge is the lack of a non-conviction based asset recovery law. Under the current legislation, crime proceeds can only be confiscated after conviction of an accused person,” she said.

Abodo said the average time a case takes to be concluded at the Anti-Corruption Court is three-five years and the appeal process is even longer.

In most times, the convicts are granted bail. The third challenge, Justice Abodo said, is the increasing use of the perpetrators’ spouses and companies to conceal crime proceeds.

“This complicates the asset tracing trail,” she said.

Initiatives yield results

Abodo said these initiatives had started to yield results as her office concluded prosecution of three money laundering cases, all of which were successfully prosecuted with accused persons being convicted and ordered to repay the laundered funds.

“To this extent, the office of the DPP has a 100% conviction rate for money laundering cases that it has prosecuted. These include Uganda Vs. Sserwamba David & three others involved in $1.45m (sh5 trillion) which was embezzled and laundered by employees of Equity Bank. In addition, there are nine money laundering cases in court and they are at different stages of hearing,” she said.

What analysts say

Although it appears that the Government is making some progress to combat illicit financial flows, economic analysts say there is no silver bullet to their threat.

“There is a need to establish co-ordination and collaborative networks with stakeholders and other partners, not only in Uganda, but also in the region. Illicit financial flows are a growing threat not only in the East African sub-region, but across Africa,” Dr Norman Mugarura, a financial crime expert and Kampala International University law lecturer, said.

Dr Fred Muhumuza, a lecturer of Economics at Makerere University, said Uganda should invest in institutions and use technical people to understand and support enforcement.

He said it should protect those involved in fighting the crimes.

This story was produced by New Vision. It was written as part of Wealth of Nations, a media skills development programme run by the Thomson Reuters Foundation.

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