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Banks to appoint money laundering officer in new CBK rules

By Patrick Alushula | Published Wed, January 3rd 2018 at 00:00, Updated January 2nd 2018 at 21:45 GMT +3
Central Bank of Kenya Governor Patrick Njoroge (PHOTO: File)

NAIROBI, KENYA: Central Bank of Kenya (CBK) has directed all banks to conduct a risk assessment exercise to determine their preparedness in fighting money laundering and terrorism.

Through a guidance note, the regulator said all banks will be required to develop a money laundering and terrorism financing (ML/TF) risk assessment framework.

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In addition, each bank will now be required to appoint a money laundering reporting officer who will be the central point of contact with the CBK.

By December 31 every year, banks shall provide CBK with a report on the results of their MT/TF risk assessment.

Minimum requirements

CBK has set the “high level minimum requirements” that banks should adopt to develop the framework which will also be subjected to scrutiny by external auditors.

“The board of directors and senior management of an institution are expected to formulate and implement ML/TF risk assessment framework. The framework must be documented and made available for review by external auditors and CBK,” says the guidance note.

Once developed, each bank will be expected to share the framework with all business lines across the bank.

This, CBK says, will ensure that all institutions licensed under the Banking Act are compliant with the CBK Prudential Guidelines on Anti-Money Laundering and Combating the Financing of Terrorism.

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