Expert warns on money laundering
Dec 15, 2009
UGANDA has made no significant steps in fighting money laundering which greatly affects the economy, a researcher has said.
By Conan Businge
UGANDA has made no significant steps in fighting money laundering which greatly affects the economy, a researcher has said.
Charles Goredema, a renown researcher in organised crime in Africa, remarked that Uganda is “still intertwined in money laundering much as the Government appreciates the vice must stop.â€
Although he could not quantify the effect of money laundering on Uganda, he said it was higher now than it was five years ago.
Goredema was yesterday speaking at the ongoing anti-money laundering seminar at Imperial Resort Beach in Entebbe.
He is the head of the organised crime and money laundering programme at the Institute for Security Studies, a regional research body operating across sub-Saharan Africa.
Money laundering is a process used to conceal the true origin and ownership of proceeds of criminal or unlawful activities.
Goredema said most legislators and people who should have fought the vice were scared of the ‘big money owners’ in the business.
“People in this illegal business are looked at as untouchables. The institutions in the country have also done little to curb this crime. Uganda quickly needs a law to fight this vice.â€
He explained that corruption, drug trafficking and robberies were an indication that money laundering is on the increase in the country.
The lack of an appropriate legal framework has made it impossible for the financial and commercial sectors to implement existing measures to fight the vice, Goredema said.
Citing examples, he explained that banks can only report suspicious transactions but cannot freeze the operations because they do not have legal protection.
The Bank of Uganda in 2002 developed anti-money laundering guidelines for banks and other financial institutions to establish and maintain specific policies and procedures. The anti-money laundering Bill was recently tabled in Parliament but some legislators believe the law is not necessary.
The Kakuuto County MP, Matthias Kasamba (NRM), argued that a developing country like Uganda may not need such a law.
“This law can work best in developed countries, which swindled our economies. We do not need such a law until we have fully developed,†he said.
Under the proposed Bill, money launderers face 15 years in jail or a fine of up to sh2b. The Bill, meant to fight crime across borders and international terrorism, provides for international cooperation in investigations and prosecution of cases of money laundering.
If passed into law, anybody transporting more than sh30m across the border will have to notify the customs and excise department of the Uganda Revenue Authority.
Finance institutions have to maintain accounts for customers in their true names. Banks will also be required by law to establish the true identity of a person on whose behalf a business a transaction is conducted. The Bill gives the court power to issue a confiscation order for property that was acquired through crime.
Property will also be confiscated if the court finds that somebody’s income from sources unrelated to criminal activity cannot reasonably account for the acquisition of the property.
UGANDA has made no significant steps in fighting money laundering which greatly affects the economy, a researcher has said.
Charles Goredema, a renown researcher in organised crime in Africa, remarked that Uganda is “still intertwined in money laundering much as the Government appreciates the vice must stop.â€
Although he could not quantify the effect of money laundering on Uganda, he said it was higher now than it was five years ago.
Goredema was yesterday speaking at the ongoing anti-money laundering seminar at Imperial Resort Beach in Entebbe.
He is the head of the organised crime and money laundering programme at the Institute for Security Studies, a regional research body operating across sub-Saharan Africa.
Money laundering is a process used to conceal the true origin and ownership of proceeds of criminal or unlawful activities.
Goredema said most legislators and people who should have fought the vice were scared of the ‘big money owners’ in the business.
“People in this illegal business are looked at as untouchables. The institutions in the country have also done little to curb this crime. Uganda quickly needs a law to fight this vice.â€
He explained that corruption, drug trafficking and robberies were an indication that money laundering is on the increase in the country.
The lack of an appropriate legal framework has made it impossible for the financial and commercial sectors to implement existing measures to fight the vice, Goredema said.
Citing examples, he explained that banks can only report suspicious transactions but cannot freeze the operations because they do not have legal protection.
The Bank of Uganda in 2002 developed anti-money laundering guidelines for banks and other financial institutions to establish and maintain specific policies and procedures. The anti-money laundering Bill was recently tabled in Parliament but some legislators believe the law is not necessary.
The Kakuuto County MP, Matthias Kasamba (NRM), argued that a developing country like Uganda may not need such a law.
“This law can work best in developed countries, which swindled our economies. We do not need such a law until we have fully developed,†he said.
Under the proposed Bill, money launderers face 15 years in jail or a fine of up to sh2b. The Bill, meant to fight crime across borders and international terrorism, provides for international cooperation in investigations and prosecution of cases of money laundering.
If passed into law, anybody transporting more than sh30m across the border will have to notify the customs and excise department of the Uganda Revenue Authority.
Finance institutions have to maintain accounts for customers in their true names. Banks will also be required by law to establish the true identity of a person on whose behalf a business a transaction is conducted. The Bill gives the court power to issue a confiscation order for property that was acquired through crime.
Property will also be confiscated if the court finds that somebody’s income from sources unrelated to criminal activity cannot reasonably account for the acquisition of the property.