Kenya
1. Does Kenya have legislation making it a criminal offence to engage in money laundering and/or terrorist financing?
Yes. The relevant legislation is the Proceeds of Crime and Anti-Money Laundering Act 2009 (POCAMLA) together with the Proceeds of Crime and Anti-Money Laundering Regulations 2013. The objective of POCAMLA is to provide for the offence of money laundering, to introduce measures for combating the offence, and to provide for the identification, tracing, freezing, seizure and confiscation of the proceeds of crime.
The Prevention of Terrorism Act, 2012 (POTA) is the principal legislation that deals with prevention of terrorism activities.
2. To whom does the legislation apply?
POCAMLA applies to both natural and legal persons.
3. What does the legislation prohibit?
POCAMLA prohibits money laundering as defined below (see response to question 4 below). A list of offences under POCAMLA and their penalties are discussed in detail at question 6 below.
4. How is money laundering defined? Does underlying criminal activity have to be proven?
“Money Laundering” as defined in sections 3, 4, and 7 of the POCAMLA means:
- Engaging in transactions (including agreements) involving property which one knows or reasonably ought to know is part of proceeds of crime, whether such transactions are legally enforceable or not, for the purpose of or purposes of concealing or disguising the origin, true nature, source, location, disposition, movement, or ownership of the property or assisting any person or persons involved or concerned to do so or removing or diminishing property acquired as a result of the commission of an offence;
- Acquisition, use or possession of property which one knows or reasonably ought to know forms part of proceeds of crime committed by him or by another person; and
- Transporting, transmitting, transfer or receipt of monetary instruments relating to (1) and (2) above, or attempting to do so.
5. What level of intent or knowledge is required to establish a violation?
According to section 3 and 4 of POCAMLA, the level of intent or knowledge required is that of “knows or ought reasonably to have known”.
6. What are the potential penalties for infringing the legislation?
Please note that where any offence is committed by a body corporate with the consent or connivance of any director, manager, secretary or any other officer of the body corporate, or any person purporting to act in such capacity, that person, as well as the body corporate, shall be prosecuted in accordance with the provisions of POCAMLA.
7. Does the legislation have extra-territorial reach?
Yes. Section 127 of POCAMLA provides that the conduct of a person that takes place outside Kenya constitutes an offence under its provisions if the conduct would constitute an offence against a provision of any law in Kenya if it occurred in Kenya.
8. Are there additional anti-money laundering or counter terrorist financing regulations or obligations, such as registration or reporting obligations, for businesses or individuals that operate in particular sectors or undertake particular activities?
Yes. In addition to obligations provided under section 44, 45, 46 and 47A of the POCAMLA, the Proceeds of Crime and Anti-Money Laundering Regulations, 2013 prescribes additional obligations on reporting institutions.
9. What are the potential penalties for failing to comply with these obligations?
Regulation 42 of Proceeds of Crime and Anti-Money Laundering Regulations, 2013 provides that any person, reporting institution or supervisory body who contravenes the provisions in the regulations commits an offence and shall, on conviction, be liable to a fine not exceeding Kenya Shillings Five Million or to imprisonment for a term not exceeding three years or both fine and imprisonment.
10. Who are the relevant enforcement authorities in Kenya and what are their contact details?
The POCAMLA provides for two agencies, the Financial Reporting Centre (“FRC”) and the Assets Recovery Agency.
The FRC
The FRC in its role is supported by other law enforcement agencies such as the National Police Service, Ethics & Anti-corruption Commission, Office of Directorate of Public Prosecutions and the Kenya Revenue Authority.
It is important to note that the FRC is only administrative in nature and has little or no ability to expedite the investigation and prosecution of suspected cases of money laundering. These two key functions lie with the National Police Service and Office of Directorate of Public Prosecutions.
Its address is at:
UAP Towers Upper Hill, 29th Floor
P.O. Box Private Bag – 00200
Nairobi, Kenya
Assets Recovery Agency
Assets Recovery Agency is semi-autonomous body under the office of the Attorney-General established under sections 52 – 55 of the POCAMLA whose principal objective is to implement the provisions of Parts VII to XII (including to institute asset recovery proceedings (preservation and forfeiture) and to administer the Criminal Assets Recovery Fund established under section 109 of the POCAMLA) inclusive and to exercise all powers set forth therein.
Its address is at:
UAP Towers Upper Hill, 22nd Floor
P.O. Box 52420-00100
Nairobi, Kenya
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