Financial Crime World

LESOTHO REGULATORS URGED TO ENFORCE STRONGER KNOW YOUR CUSTOMER RULES

Lesotho’s financial institutions are being urged to comply with the country’s Know Your Customer (KYC) regulations to prevent money laundering and terrorist financing. As a member state of the Financial Action Task Force (FATF) and the Eastern and Southern Africa Anti-Money Laundering Group (ESAAMLG), Lesotho is required to implement KYC/AML regulations in line with international standards.

Primary Regulators

The Central Bank of Lesotho (CBL) and the Lesotho Financial Intelligence Unit (LFIU) are the primary regulators enforcing AML/KYC regulations. Section 15 of the Money Laundering and Proceeds Crime Act 2008 is the main legislation governing KYC/AML in Lesotho.

Data Protection Laws

Lesotho has also implemented data protection laws through the Data Protection Act 2013 (DP Act). The act requires institutions to obtain users’ consent before processing and transferring personal data. Users have the right to request erasure of their personal data upon request.

Compliance Requirements

To ensure compliance with these regulations, financial institutions are advised to implement robust KYC procedures that include:

  • Accurate verification of customers’ identities using ID documents
  • Biometric face matching

Acceptable ID documents for KYC purposes in Lesotho include:

  • National ID card
  • Passport
  • Driver’s license

Fraud Prevention Measures

The government has implemented measures to prevent fraud, including the use of digital ID document verification solutions that:

  • Check for authenticity
  • Accurately transcribe text on the document
  • Compare a user-submitted selfie to the document image

Smile ID Solution

In response to these regulations, Smile ID has developed a comprehensive solution to help financial institutions in Lesotho quickly verify identities and stay compliant with digital KYC and data regulations. The solution offers:

  • 99.8% recognition accuracy for faces of all skin tones
  • Compatibility with any device

Smile ID’s document verification solution includes:

  • Checking for accurate format
  • Identifying tampered and forged documents
  • Verifying security features
  • Providing real-time results, confirming the authenticity of a document and its belonging to the user

Call to Action

Financial institutions in Lesotho are urged to take immediate action to ensure compliance with KYC regulations and protect their customers from fraud and identity theft. Smile ID is equipped to help financial institutions level up their KYC/AML compliance stack and stay ahead of regulatory requirements.