President William Ruto on Friday assented to the Anti-Money Laundering and Climate Bills into law.
The Anti-Money Laundering and Combating of Terrorism Finance Amendment Bill seeks to address deficiencies limiting the fight against money laundering and terrorism in the country.
The Bill that amended 18 Acts of Parliament relating to anti-money laundering, countering the financing of terrorism and countering the financing of proliferation of weapons of mass destruction will see lawyers report any clients suspected of money laundering to the Financial Reporting Center (FRC).
The proposal had initially been objected to by the Law Society of Kenya (LSK) in court, arguing that it was against client-advocate confidentiality, but after negotiations with FRC and the Attorney General, they agreed that LSK would regulate itself.
Under the new law, LSK will regulate, supervise, and enforce compliance with Money Laundering, combating the financing of terrorism and countering proliferation financing for lawyers, notaries and other legal professionals.
Section 2(C) and section 14(B) of the Proceeds of the Crime and Anti Money Laundering (Pocamla) designates lawyers and their accountants, cleaners and clerks as reporting agents for FRC.
Notaries and other independent legal professionals will report dirty cash dealings to FRC.
The FRC has also been granted operational independence by excluding it from the definition of State Corporation after the amendment of State Corporations Act (Cap 446).
The Act has empowered the Central Bank of Kenya (CBK) to supervise financial institutions and agents of reporting institutions and allowing the CBK to disclose any information required for the discharge of it’s functions under the Proceeds of Crime and Anti Money Laundering Act.
CBK will also supervise pay service providers and agents of institutions under the National Payment Systems Act and prescribe penalties for violations of provisions of the Proceeds of Crime and Anti Money Laundering Act 2009.
The Bill also sought to increase the value of a cash transaction which a reporting institution is obliged to file a report with the Financial Reporting Center from $10,000 or (Sh1,457,000) to $15,000 (Sh2,185,500)
With the operationalisation of the law, companies will be required to keep a record of information on its beneficial owners for the last ten years from the date they cease to be the beneficial owner.
The President also assented to the Climate Change (Amendment) Bill (National Assembly Bill No. 42 of 2023), which was published in July. The Bill amends the Climate Change Act, 2016, providing for regulation of carbon markets and enhancing response to climate change.
It provides transactions in carbon trading as carried out under the Act to reduces greenhouse gas emissions.
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The Cabinet Secretary, it adds, can enter into a bilateral or multilateral agreement to trade carbon for emission reductions and removals with the approval of the Cabinet.