Frequently Asked Questions
1. What is Money laundering?
Money laundering is a process of concealing the true origin of dirty/ill-gotten money. This is done through different means whereby criminals place the dirty funds into the streams which will make the origin not to be traceable.
2. Why do people launder money?
In order for criminals to escape prosecution which usually culminates in confiscation of the ill-gotten funds, they would launder the money to prevent the authorities from detecting the origin of he funds.
3. How is Money Laundered?
There are generally 3 stages through which money is laundered:
a. The first is the placement stage, where the dirty money is introduced to a financial system.
b. The second, layering stage consists of a series of transactions designed to conceal the origin of the funds. These financial transactions resemble legitimate financial transactions designed to make tracing the funds as difficult as possible.
c. The last stage, integration involves return of money into the economy as “legitimate” funds. The funds return assimilated into the economy to create appearance of legality. This is because distinguishing between licit and illicit funds is extremely difficult at this stage.
4. What is Terrorist Financing?
Unlike in money laundering where funds involved are always ill-gotten, under terrorist financing any funds whether clean or dirty can be used to finance terrorism or terrorist institutions as the case may be.
5. What could raise a suspicion of money laundering?
Criminals are continually orchestrating ways in which they can conceal the origin of their illicit cash. Their tricks are ever changing and developing and raising a suspicion requires one to always be careful to properly scrutinise circumstances before making a decision whether or not to raise a suspicion.
Indicators of Suspicious Transactions provide guidance on what may raise a suspicion of money laundering
6. How can I protect my business from being used by money launderers?
Accountable institutions, which are most vulnerable to being used to launder money can protect their businesses by implementing the controls required by the National anti-money laundering law and internationally accepted standards for prevention of money laundering.
7. What is the FIU and its role?
The Financial Intelligence Unit (FIU) is central institution in the fight against money laundering and terrorist financing. It is a national central agency that receives financial information from accountable institution for analyses. Where a money laundering or terrorist financing offence is suspected to have taken place then it disseminates the disclosure of information to law enforcement agencies or other relevant stakeholders for investigation and possible prosecution and/or regulatory/supervisory action.
8. Who has to report to the FIU?
Institutions listed under schedule 1 of the Money Laundering and proceeds of /crime Act of 2008 are responsible to report to the FIU.
9. Can I disclose to anyone if I have reported to the FIU?
Tipping-off is a crime under the MLPCA therefore one can not disclose the fact that hey have reported any suspicion about any person (natural or juristic).