ZACC warns banks

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Harare (New Ziana) – The Zimbabwe Anti-Corruption Commission (ZACC) on Monday warned banks being used to ‘clean’ proceeds of ill gotten money, saying the long arm of the law will soon catch them.

In a speech read on her behalf at the inaugural financial crimes indaba, ZACC chairperson Justice Loice Matanda-Moyo said the commission was aware of the shenanigans of corruption being done in the private sector.

” Corrupt individuals often turn to banks and other financial institutions to legitimise their dirty monies by bringing them into the formal financial system.

“We are aware that corruption in the private sector is damaging the economy, and this must stop forthwith.
” We have noted that some banks’ involvement as conduits of proceeds of ill-gotten money from the public sector. We are warning you that this must stop,” she said.

Justice Matanda-Moyo said the commission was receiving reports of corruption in the financial services sector, which in turn erodes public confidence in the banking sector.

Lack of confidence in the financial sector , Matanda-Moyo said, dissuaded the public from using normal banking services.

“Many banks continue to provide the corrupt with a haven to stash their dirty money. This loophole is due to both overall lax enforcement of anti-money laundering regulations and the way that banks currently undertake due diligence.

“We even understand that in some cases, executives of local banks are stashing their money in offshore accounts.
“If you do not have confidence in an institution that you lead, then who do you expect to have confidence? This must stop forthwith and as ZACC we will investigate this and expose the culprits,” she said.

Matanda-Moyo said the recent Transparency International Corruption Perception Index indicated that Zimbabwe had moved a few notches up the rankings because of efforts being made to fight corruption.

” We are nowhere near where we want to see ourselves but nonetheless, we must remember that a journey of a thousand miles begins with one step,” she said.

Speaking at the same occasion, Reserve Bank of Zimbabwe Governor Dr John Mangundya said banks play a very important gatekeeper role to prevent proceeds of financial crimes from entering the financial system.

He said the indaba comes at an opportune time, when the Financial Action Task Force (FATF), had just accorded a vote of confidence to the country in recognition of the steps being made in combating financial crimes over the last two years.

” As a last step towards removing the country from the grey list of non compliant jurisdictions, the FATF is to send a multi – national team of experts to the country in January 2022 to confirm what Zimbabwe had been reporting in its progress report, as well as to assess stakeholder and political commitment.
“While the vote of confidence shown to Zimbabwe by the FATF is cause for deserved celebration, it should not be construed as a signal that the country has run the race and won the fight against money laundering and related financial crime,” he said.

FATF is an inter-governmental body that is tasked with the responsibility of setting and monitoring implementation of global standards for combating money laundering and related financial crime.

Dr Mangundya said the central bank’s Financial Intelligence Unit (FIU) had received more reports of suspicious transactions from banks and other institutions.

This year alone, the FIU has received at least 5 162 suspicious transaction reports filed by banks, up from 1 727 cases reported in 2017.

“The steady increase of suspicious transactions reported year-on year, especially by banks and to a lesser extent by other designated institutions, also demonstrate the positive progress in understanding and implementing anti-money laundering requirements, ” he said.

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