The Financial Intelligence Authority (FIA), the government body responsible for combating money laundering and financing of terrorism activities, has come up with a strategy aimed at ensuring that Uganda is not included on the Financial Action Task Force (FATF) grey list.
In February this year, the FAFT plenary, at its meeting in Paris, France, concluded that Uganda had fully implemented its action plan of addressing the strategic Anti-Money Laundering and Combating Financing of Terrorism deficiencies, which had been previously identified during evaluations.
As such, Uganda has been scrapped off the list of countries under increased monitoring (grey list). According to Bright Besigye, the manager of International Relations at FIA, in 2016, Uganda was assessed by the FAFT and found that the country had weaknesses within its systems.
And because of those weaknesses, it was placed under an observation period which ended in 2019. By the end of 2019, Uganda had been able to demonstrate significant progress, particularly at the technical level with the amendment of the Terrorism Act to make terrorism financing a crime; increased training of law enforcement forces; increased staffing of the financial intelligence unit; and an increased budget.
However, there was still lack of effectiveness in the implementation of FAFT standards and hence the country was placed on the grey list in February 2020.
"When you are put on the grey list, financial institutions in other countries subject you to enhanced due diligence, and this has an impact on the cost of doing international business and how our nationals access foreign credit. It was, therefore, a big concern for us and government and that is why we had to strive hard to get off of it before being blacklisted," Besigye said.
The Post Grey List Exit Strategy, which was developed through the ministry of Finance, will see FIA increase awareness about money laundering and terrorism financing activities. The aim here is to have all stakeholders at each stage such as prevention, detection, investigation, prosecution, conviction and recovering proceeds understand their work, and have the right tools and skills to do their job.
The authority also wants to establish the National Money Laundering Safety Task Force under the minister of Finance to tackle financial crimes. The ministry has embarked on developing a successor strategy for the current FIA Strategic Plan, which expires in 2025.
The new strategy will bring on board measures that can deal with the current money laundering threats. The post-exit strategy further looks at building and increasing the capacity of other institutions to deal with money laundering and financing of terrorism crimes through training and stakeholder engagements.
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"Recently, we held meetings with the leadership of the Uganda Police, the ministry of Internal Affairs, the judiciary, Bank of Uganda and several others. We want to build the capacity of other institutions so that it is not only the work of the FIA to combat these crimes," Besigye added.
Uganda will undergo another mutual evaluation by the FAFT in 2028 and the FIA believes that this Post Exit Grey List Strategy will enable it pass that assessment.
"Our aim is to make sure that by 2028, we are able to avoid another grey list by partly implementing this strategy and making sure that all the requirements as expected of us are largely met," Besigye noted.
He further explained that "as a country, we are striving to meet the minimum standards, apply the right measures, evolve as the crimes evolve and work with an all-government approach to deal with the crimes in their entirety."
