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Insurers Urged to Detect and Report Suspicious Transactions
In a bid to combat money laundering and terrorist financing, the Financial Intelligence Unit (FIU) has issued guidelines requiring insurance companies to detect and report unusual and suspicious transactions.
Guideline Requirements
According to the guidelines, insurers are required to:
- Develop policies, procedures, and controls that take into account the risks of money laundering and terrorist financing, particularly in relation to new or developing technologies that favor anonymity.
- Appoint a management-level officer as the Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) officer, who will have timely access to all customer records and other relevant information. The officer will be responsible for ensuring compliance with AML/CFT regulations.
- Maintain an audit function that is adequately resourced and independent, and which will regularly assess the effectiveness of their internal policies, procedures, and controls.
Additional Requirements
In addition, insurers are required to:
- Screen employees and agents when hiring, as well as provide regular training on AML/CFT laws and regulations, including detecting and reporting suspicious transactions.
- Develop a group policy on AML/CFT that extends to all its branches and subsidiaries outside Tanzania. The guidelines also require insurers to apply the higher of the two standards in countries with inadequate AML/CFT measures.
Expert Opinion
Experts have warned that detecting suspicious transactions is not a straightforward process. “It’s like trying to find a needle in a haystack,” said one expert. “You need to be vigilant and have a deep understanding of the AML/CFT regulations.”
The FIU has provided examples of money laundering and terrorist financing involving insurance, which are designed to help insurers identify suspicious transactions.
Increased Cooperation Needed
The guidelines are seen as an important step in increasing cooperation between financial institutions, including insurance companies, to prevent the misuse of financial products for illicit purposes. “We need to work together to ensure that our financial systems are not exploited by criminals,” said a senior official at the FIU.
As the guidelines come into effect, insurers will be required to report any suspicious transactions to the FIU. The authority has emphasized that it is committed to providing support and guidance to help insurers comply with the guidelines.
Contact
For more information on the guidelines or to report suspicious transactions, contact the Financial Intelligence Unit (FIU) at [insert contact details].