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U.S. Treasury Official, Kutesa Discuss Illicit Inflows into Uganda

A high ranking United States official has met with Uganda’s Foreign Affairs Minister Sam Kutesa over illicit financial inflows into the East African country.

Illicit financial flows can be defined broadly as movements of money and value from one country to another that are illicitly earned, illicitly transferred, and/or illicitly utilized.

The U.S. Mission in Uganda on Tuesday said Treasury Assistant Secretary Marshall Billingslea had a “productive and frank exchange of views with Minister Kutesa on a wide range of important bilateral issues including the importance of a strong Ugandan economy and countering illicit flows of money in Uganda and the region.”

Marshall had earlier met with officials from Bank of Uganda and Ministry of Finance to assess the country’s ability to control illicit financial transactions.

“The U.S. officials also wanted to see how we can work together to strengthen our financial system from being used by wrong elements to finance the activities of wrong people including terrorism,” said an official who attended the meeting at the Foreign Affairs Ministry in Kampala but preferred anonymity to speak freely.

Contacted for comment, the Ministry’s Permanent Secretary Amb James Mugoya referred ChimpReports to Minister Sam Kutesa who was not readily available for comment.

The U.S. and Ugandan officials in a meeting earlier today

However, a recent report revealed that insufficient levels of financial transparency—globally and domestically—and government accountability in Uganda, coupled with a regulatory system that can incentivize financial crimes, are helping to drive high levels of illicit financial inflow and outflows in the country, which are undermining development efforts.

It also indicated that Uganda will struggle to meet its goal of rising to middle income status and reducing its reliance on foreign debt unless it increases efforts to combat the commercial tax evasion, corruption, and money laundering of criminal proceeds and terrorist financing.

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The Global Integrity Report 2018 urged Uganda to eliminate the allowance and use of anonymous companies in the economy, reduce the ease and volumes of trade misinvoicing, and enforce anti-money laundering laws, particularly within the banking sector.

“Uganda’s laws and regulations on financial transparency and anti-money laundering have the strongest influence on illicit financial flows, and there are notable gaps in the framework the Government of Uganda has in place to address the sources, transfer methods, and motivations of IFFs in the country,” the report reads in part.

During the meeting, it is understood Marshall also sought information on Uganda’s implementation of the United Nations Security Council resolutions including sanctions on individuals in the region.

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