Companies Used to Create Distance Between Criminal Elements and Illicit Proceeds
A Scheme to Launder Money
Kampala, Uganda - The Financial Intelligence Unit (FIU) has recently uncovered a clever scheme used by criminals to create distance between themselves and illicit proceeds. This scheme involves the use of fake transactions reports and large currency transaction reports received from financial institutions to uncover syndicates and other irregular activities in government.
Compromised Accounting Software
The Integrated Financial Management Information System (IFMIS), an accounting software used by the Malawi government, has also been compromised. The system is designed to record all financial transactions, but criminals have found ways to manipulate it. They register fake companies with similar names to existing organizations, deposit altered cheques, and then launder the money.
A Notable Case
In one notable case, a businessman registered a company called Mzanti Technologies with a similar name to a trendy technological company in Blantyre, Mzansi Technologies. The criminal went on to open an account at Bank M and deposited three cheques drawn on different banks, which were later found to be altered from the original cheques meant for Mzansi Technologies.
Red Flags
- Registration of a business name similar to an existing organization
- Alteration of cheques before depositing them in a bank account
- Collusion with staff from organizations or businesses being targeted
- High volumes of merchandise with cheques and cash seemingly coming in from everywhere
Convicted Suspects
In the “cashgate” scandal, several suspects have been convicted of theft and money laundering charges. The cases are ongoing at the courts of law.
Ongoing Investigations
The FIU is currently investigating several other cases involving fake cheques and altered transaction reports. We will provide updates as more information becomes available.
Urgent Call to Action
“We urge all financial institutions and businesses to remain vigilant and report any suspicious transactions to us,” said an official at the FIU. It is essential that individuals and companies be cautious when dealing with financial transactions to prevent falling victim to this illegal activity.