Financial Crime World

Here is the rewritten article in markdown format:

Fraudulent Transactions in Financial Services Worry Tanzanians

The Central Bank of Tanzania has introduced new regulations to enhance financial services customers’ confidence in the sector and promote stability, growth, and innovation. The Consumer Protection Regulations aim to create a robust consumer protection regime in the financial sector, ultimately creating a stable financial system.

Key Provisions

  • All financial service providers, including mobile money operators licensed by the Bank, are required to develop internal policies and procedures for handling complaints and ensuring fair treatment of customers.
  • Financial institutions must disclose information about their products and services to customers in a clear and understandable manner.
  • The regulations provide for the establishment of an Alternative Dispute Resolution Mechanism (ADRM) to handle disputes between financial service providers and their customers.

COVID-19 Policy Measures

In response to the COVID-19 pandemic, the Bank has introduced several policy measures aimed at mitigating the impact of the crisis on the financial sector. These measures include:

  • Reducing the Statutory Minimum Reserves requirement from 7% to 6%
  • Lowering the discount rate from 7% to 5%
  • Increasing daily transaction limits for mobile money customers

The Bank has also confirmed that Tanzania has adequate foreign exchange reserves for importation of goods and will continue to monitor the situation and take appropriate policy measures to limit the impact of COVID-19.

Sanctions for Non-Compliance

Financial service providers who fail to comply with the regulations may face sanctions, including:

  • Suspension from operations
  • Fines or penalties
  • Order to withdraw financial products or services
  • Suspension of management staff
  • Imposition of conditions or restrictions on registration or licenses
  • Disqualification of individuals from carrying out regulated activities

Conclusion

The new regulations and COVID-19 policy measures are aimed at promoting stability, growth, and innovation in the financial sector while protecting consumers from fraudulent transactions. Financial service providers must comply with the regulations to avoid facing sanctions, and consumers should be aware of their rights and responsibilities under the new regulations.

By Angela Mndolwa (Partner) and Idrissa Juma (Associate Trainee), IMMMA Advocates.