Financial Crime World

Rwanda Takes a Tough Stance on Financial Crime: AML/CFT Law Comes into Effect

Rwanda has taken a significant step to prevent the devastating effects of money laundering (ML), terrorist financing (TF), and proliferation financing by introducing the Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT) law. The legislation, which came into effect in 2020, requires reporting persons to implement measures to mitigate the risk of abuse in the financial system.

Key Provisions of the AML/CFT Law

  • Requires reporting entities to implement measures to mitigate the risk of abuse in the financial system
  • Obliges supervisory authorities to ensure compliance with legal requirements through supervision and regulation issuance
  • Creates a regime of preventive measures to manage the risk of abuse in the context of ML, TF, and proliferation financing

Role of Supervisory Authorities

As the regulator of financial institutions, the National Bank of Rwanda plays a crucial role in issuing guidelines and regulations for financial institutions to adhere to. The bank is responsible for ensuring that reporting entities comply with the legal requirements by means of supervision and regulation issuance.

Preventing Financial Crime

The AML/CFT Law creates a regime of preventive measures to manage the risk of abuse in the context of ML, TF, and proliferation financing. This move is seen as a significant step towards preventing the misuse of the financial system for illegal activities, thereby safeguarding the country’s economy and financial stability.

International Cooperation

Rwanda’s efforts are in line with international best practices and standards aimed at preventing money laundering, terrorist financing, and proliferation financing. The country’s commitment to combating financial crime demonstrates its willingness to work towards a safer and more transparent financial environment.

By implementing the AML/CFT Law, Rwanda has taken a bold step towards protecting its financial system from abuse and safeguarding its economy and financial stability. The law serves as a testament to the country’s commitment to combating financial crime and promoting international cooperation in this area.