Features & Sacco Leadership

Sacco to register to anti-money laundering

Saccos

By Clarence Imbayi

President William Ruto assented to the Anti-Money Laundering and Combating of Terrorism Financing Laws(Amendment) Bill 20223 into law. 

The new law requires SACCOs, casinos, real estate agencies, forex bureaus and life insurance brokers to register. 

The bill is aimed at helping the country to address deficiencies limiting the fight against money laundering and terrorism. It allows for the surrendering of a fugitive criminal who consents to be extradited to a requesting State.

According to a report by the Sacco Societies Regulatory Authority (SASRA), there are 176 Deposit Taking Sacco Societies in Kenya. It is further mandated to ensure that there is confidence in the public towards the Sacco sector and promote Kenya’s economic growth through the mobilization of domestic savings. 

During the Sacco’s Annual Delegates Meeting in Mombasa earlier this year, CS Cooperatives and MSME Development Simon Chelugui urged SASRA to register SACCOs, to benefit in the disbursement of Hustler Funds to small businesses and groups, as well as Cooperatives in the country. 

One of the key requirements for SACCOs to be selected on the government’s plan of uplifting members at the bottom of the pyramid and encouraging is to have been registered by SASRA. 

According to a statement released by the Financing Report Center(FRC) singularly to chief executives of SACCOs and real estate, the Sacco Societies Regulatory Authority SASRA and property firms should monitor their reporting to ensure no profits are used to finance terrorism activities and money laundering schemes. 

“Casinos and internet betting firms also need to comply with FRC, alongside Kenya Revenue Authority (KRA) tax collection from gamblers. Real Estate must register on or before September 15, 2023. In which failure to register could lead to revocation of operating licenses for these institutions,” partly read the statement.

The law further grants the Financial Reporting Centre operational independence by excluding it from the definition of a State Corporation. This comes after claims and alarms by the Eastern and Southern Africa Anti-Money Laundering Group (ESAAMLG) of huge illegal cash flowing into the country. ESAAMLG monitors how the region is implementing global measures against dirty cash. 

Financing Report Center together with KRA aims to collaborate to monitor any suspicious financial activities and the Kenya Revenue Authority KRA to further provide reports about currency coming in the country more than $10,00. This is to further combat and fight against money laundering and financial crimes. 

According to the ESAAMLG report, the claims could negatively affect the status and standards of the country’s major capital city Nairobi as the region’s financial center.

In the new law, the Central Bank of Kenya (CBK), will supervise financial institutions and agents of reporting institutions.

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