he misconception worth correcting first is that anti-money laundering in Kenya is a banking obligation. Since the 2023 amendments to POCAMLA, the duties have applied with sharper force to the designated non-financial businesses and professions, accountants, advocates, real estate agents, casinos, and dealers in precious metals and stones.
Who is in scope
A non-bank business is a reporting institution if it falls within one of the designated categories and is carrying on the relevant activity in or from Kenya. The duties apply whether or not the business is also regulated by a sectoral authority, and the obligations are layered, not substitutive.
The five duties, in shorthand
- Customer due diligence on every business relationship, with enhanced measures for higher-risk customers.
- Ongoing monitoring of the relationship, including transaction monitoring against the customer's expected pattern.
- Record-keeping for at least seven years after the relationship ends.
- Internal controls, a written AML policy, a designated reporting officer, and staff training.
- Reporting of suspicious transactions to the Financial Reporting Centre.
“The duty the FRC will most readily enforce is the duty no one quite remembered: ongoing monitoring, supported by documentation.”
Penalties, administrative and personal
Penalties under POCAMLA include administrative fines of up to twenty million shillings for institutions and five million shillings for individuals, alongside the criminal exposure under the offences provisions. Directors and senior officers carry personal exposure where the institution's failure is attributable to their conduct.
What good looks like
A reporting institution that can produce, on request, a written AML policy, a current risk assessment, the customer due diligence files, the transaction monitoring log, the staff-training register, and the designated officer's reports is a reporting institution the FRC will engage with quickly and leave quickly. The cost of getting there is modest. The cost of being unable to is not.