Global anti-laundering watchdog sending team to Uganda

June 28, 2017 in Business, Finance, Financial Services, Policy by Editor

June 28— The Financial Action Task Force (FATF), the global watchdog against money laundering and terrorism financing, is sending an inspection team to Uganda to verify whether the recently amended laws to strengthen compliance are being implemented. Combating terrorist financing is a top priority for the FATF.

‘The FATF will conduct an on-site visit to confirm that the process of implementing the required reforms and actions is underway to address deficiencies previously identified by the FATF,’  the Paris-based organization said in a statement at the close of the plenary meeting in Valencia, Spain last week. FATF was started in 1989 to develop global standards and evaluate countries’ compliance in line with protecting the integrity of the international financial system.

Earlier this year, Parliament passed the Anti-money Laundering (Amendment) Bill 2017 to address concerns raised by FATF about Uganda’s inadequate provisions to limit terrorism financing using banks and other financial institutions.

FATF has been asking for six measures to ensure Uganda is compliant with current international standards. The first is to adequately criminalize terrorist financing;  establish adequate procedures for freezing terrorist assets in accordance with the United Nations Security Council Resolutions (UNSCRs 1267 and 1373), and their successor resolutions.

FATF also wants all financial institutions subject to adequate record-keeping requirements; set up a fully operational and effectively functioning financial intelligence unit and introduce an appropriate legal basis to permit the competent authorities to provide a wide range of mutual legal assistance. Finally, the watchdog has requested that appropriate laws and procedures are in place with regard to international co-operation for the financial intelligence unit and supervisory authorities.

Henry Musasizi, who chaired the parliamentary committee on finance, planning and economic development said after the amendments were passed in April, “Though the law previously provided for the prompt freezing, seizure and forfeiture of assets and property suspected to be linked to terrorists or terrorist activities, it did not define who a terrorist is and or what amounts to terrorism or a terror act. This made dispensation of the law very difficult warranting the new amendments to the Anti-money Laundering (Amendment) Bill 2017.”

During the FATF plenary, Uganda’s case came up for review towards removing it from the list of countries considered ‘jurisdictions with severe deficiencies’ commonly referred too as the “Grey List’.

Currently, the countries are Bosnia and Herzegovina, Ethiopia, Iraq, Syria, Uganda, Vanuatu and Yemen. However after a review of all seven, only Uganda received a favourable assessment indicative of a probable exit from the Grey List before the end of the year.