NAIROBI: The Government has published new anti-graft laws targeting financial institutions and other entities likely to benefit from the proceeds of corruption.
Threatened with the possibility that the fight against corruption could slowly be losing momentum, the Jubilee administration has repealed the Proceeds of Crime and Anti-Money Laundering Act, 2012, in a move that could give room to freezing of 'dirty' property, and the de-registration of institutions and businesses that engage or assist in the commission of economic crimes.
Those targeted are banks, individuals and other entities whose employees or chief executives could face tough sanctions for failure to comply with orders of the Financial Reporting Centre (FRC), the Central Bank of Kenya, institutions tasked with receiving and analysing reports of unusual or suspicious transactions.
The new Proceeds of Crime and Anti-Money Laundering Bill, 2015 has enhanced the powers of the FRC, including imposing tough penalties on institutions that fail to comply with specific orders and allowing investigators access to crucial documents.
"The principal object of this bill is to enhance the powers of the financial reporting centre to impose civil penalties and take administrative action against non-compliance with the directives of the centre," reads the bill published on Friday last week.
Under the proposed law, a reporting institution is defined as a financial institution and designated non-financial business and profession.
Other entities likely to be affected by these laws include casinos, real estate agencies, dealers of precious stones and metals, non-governmental organisations and accountants.
The Cabinet secretary may also, on the advice of the FRC, declare any other business or profession in which the risk of money laundering exists a reporting institution. Such professions include lawyers.
"The centre may for reasons disclosed in writing issue an order to a competent supervisory authority requesting the suspension or revocation of a licence or registration of a specified reporting institution whether entirely or in a specified capacity or an employee of the reporting institution," the bill reads.
It proposes the imposition of fines of up to Sh25 million for corporate institutions that fail to comply with orders issued by the FRC, such as inspection of documents.
Individuals accused of such complicity could face a fine of up to Sh1 million upon conviction. The FRC can also order such reporting institutions to sack employees suspected of engaging in corrupt dealings.
