Financial Crime World

Tanzania Struggles to Implement Anti-Money Laundering Measures, Says FATF Report

The Financial Action Task Force (FATF) has released a report highlighting Tanzania’s ongoing challenges in implementing effective anti-money laundering measures. The country received a rating of “partially compliant” for 23 out of 40 recommendations, indicating significant areas of concern.

Key Findings

  • Tanzania’s risk assessment and application of a risk-based approach are only partially implemented, with inadequate procedures in place for identifying and mitigating money laundering risks.
  • The country’s national cooperation and coordination among law enforcement agencies and financial institutions is lacking.
  • The money laundering offence is too narrow, failing to cover all types of money laundering activities.
  • Confiscation and provisional measures are limited, allowing criminals to evade justice.

Terrorist Financing Offence

  • Tanzania’s terrorist financing offence was found to be partially implemented, with inadequate procedures in place for identifying and freezing terrorist assets.
  • The country’s targeted financial sanctions related to terrorism and proliferation are non-existent.

Areas for Improvement

Customer Due Diligence

  • Tanzania needs to improve its customer due diligence procedures.
  • Record keeping and internal controls must also be strengthened.

Reliance on Third-Party Providers

  • The country’s reliance on third-party providers is a significant concern, and transparency and beneficial ownership of legal persons and arrangements need to be improved.

Financial Intelligence Unit

  • Tanzania’s financial intelligence unit is underdeveloped.
  • Law enforcement agencies lack the necessary powers and resources to effectively investigate and prosecute money laundering cases.

Conclusion and Recommendations

The FATF report concludes that Tanzania needs to take urgent action to address these weaknesses and improve its anti-money laundering regime. The country must:

  • Strengthen its legal framework
  • Enhance cooperation among law enforcement agencies and financial institutions
  • Improve transparency and accountability

The Tanzanian government has pledged to implement the recommendations outlined in the FATF report, but time is of the essence. If left unchecked, money laundering and terrorist financing can have devastating consequences for the country’s economy and national security.