While Uganda maintains position in the world’s top 15 high risk countries popular for financial crimes, there have been efforts put in place by security and financial crimes intelligence agencies to reverse that situation.
High risk countries according to European Union Commission are identified by their strategic deficiencies in their anti-money laundering and counter-terrorism financing (AML/CTF) regimes.
In 2018, the Money Laundering and Terrorist Financing National Risk Assessment report indicated that Uganda was suffering from “a low money laundering combating ability,”
It also indicated that Uganda’s financial crimes intelligence agencies lacked capacity to detect and fight money laundering.
In a bid to defeat the crime, government decided that there should be improved standard of money laundering detection and investigations of cases.
In this effort, government and the police have secured numerous advanced security training programmes from United States of America leading institutes, Agencies and police counterparts from across the world.
Since 2018, Foreign experts especially from the USA and Europe have been coming to Uganda to train criminal investigations detectives in various fields such as detection of fraudulent documents, human trafficking and organised crime such as money laundering.
Findings indicate that the efforts seem to be enabling agencies in curtailing the crime.
According to the Uganda Police Force crime report of 2019, it is indicated that financial crimes including money laundering dropped by 12.1%.
According to the police financial crimes unit in the period under review, 13,264 cases reported compared to 15,099 cases reported in 2018, indicating a decrease.
“Among the crimes reported, obtaining money by False Pretences was the highest category reported under Economic Crimes with 10,598 cases. Much as it was highest under this category, it reduced by a 13.9% decrease,” according to the Ugandan police crime report for 2019.
Suspected money laundering schemes such as Dunamis Coins Resources Limited and Global Crypto Currencies pyramid scheme obtained a total of Shs 30,625,000,000 from 2,925 victims.
In the same year, the Financial Intelligence Authority also revealed that a total of Shs 709,000,000 was blocked for purposes of saving the fraudulently obtained funds by suspected launderers.
Enforcement agencies further closed entities suspected to be run by organised criminal groups and three suspects were arraigned to court and remanded to prisons.
However, the Financial Intelligence Authority says that despite the efforts, there are other challenges especially the laxity within the banking sector.
The FIA director Sydney Asubo said in an interview that failure by some banks to comply with the Anti Money Laundering Law is one major loophole in fighting the illicit money in the economy.
“There are no administrative sanctions provided under the Financial Institutions Act, 2004 and the Financial Institutions (Anti-Money Laundering)Regulation, 2010, to allow BOU to impose sanctions on financial institutions,” Asubo said.
Meanwhile, FIA revealed that it has received intelligence of criminals especially money launderers attempting to benefit from the prevailing Covid19 pandemic through fraudulent fundraising; fake charities, various medical scams (including investment fraud and online sale of fake medicine and medical equipment like protective equipment such as gloves and masks, and sanitizers.
The agency also raised concern on the post Covid-19 period, it is believed that the current financial volatility may entice money launderers or terrorists to invest in real estate or troubled businesses which can be used to generate cash and mask illicit proceeds or use corporate insolvency proceeds to mask funds’ origin.
“Illicit proceeds can also be introduced to the system as customers look for new means to restructure loans and credit lines. There is also a concern that large withdraws of cash and liquidation of shares portfolio may provide an opportunity for money launderers to mingle illicit funds with clean money when the funds are later returned to the system,” Asubo said.
The story was produced by www.chimpreportscom. It was written as a part of Wealth of Nations a media skills development programme run by the Thomson Reuters Foundation in partnership with the African Centre for Media Excellence. More information at www.wealth-of-nations.org. The content is the sole responsibility of the author and the publisher.