President amends Money Laundering Act – Sunday Mail

via President amends Money Laundering Act Sunday, 12 January 2014 Sunday Mail

Brian Chitemba
PRESIDENT Mugabe has invoked the Presidential Powers (Temporary Measures) to amend the Money Laundering and Proceeds of Crime Act which will see penalties for serious offenders increasing from US$600 to a punitive US$500 000, in a frantic bid to combat the abuse of the financial system.

The new Statutory Instrument 2 of 2014 made several amendments which brought into effect stiffer penalties to curb money laundering and terrorist financing — a rampant white-collar crime stalking the country.

The changes to the Money Laundering and Proceeds of Crime Act were made to make the law compliant with the requirements of the Financial Action Task Force. The law is in line with the 1999 United Nations Convention for the Suppression of Financing of Terrorism.

Zimbabwe is a member of the Eastern and Southern African Money Laundering Group and is supposed to “apply anti-money laundering measures to all serious crimes and implement any other measures contained in multilateral agreements and initiatives to which member countries subscribe for the prevention of and control of laundering of proceeds of crime”.

Under Statutory Instrument 2 of 2004, section 5 of Chapter 9:24 (Directives may specify civil infringements and impose penalties and other sanctions) which initially set a penalty of level ten at US$600, has been amended to fix the fine at US$500 000 while a level three penalty is now US$5 000 from US$20.

A fixed penalty of level five which was pegged at US$100 has been reviewed to US$100 000 while level one fine changes from US$5 to US$5 000.
Subsection 8 (a) of Section 8 of Chapter 9:24 which initially provided that “by a fine not exceeding level fourteen or not exceeding twice the value of the property that forms the subject of the charge, whichever is greater,” has been replaced by a provision which states that the fine shall not exceed US$500 000 or not exceeding twice the value of the property involved or the gain derived by the offender.

The Money Laundering and Proceeds of Crime Act was passed in June last year which brought amendments to the Bank Use Promotions and Suppressing of Money Laundering Act, Building Societies Act, Criminal Matters (Mutual Assistance) Act and the Asset Management Act.

Under the anti-money laundering legislation, banks are empowered to “receive, analyse and disseminate suspicious transactions.”
Financial institutions can also scrutinise transactions by politicians and heads of state-owned firms to minimise any chances of money laundering and terrorism financing.

The law also bars people from dealing with shell banks — a financial institution that has no physical presence in Zimbabwe.
However, it does not include a bank of description which is wholly owned by one or more financial institutions forming part of a regulated financial services group that is subject to effective consolidated supervision.