CENTRAL BANK OF KENYA
Remarks by
PROF. NJUGUNA NDUNG’U
GOVERNOR
ANTI-MONEY LAUNDERING (AML) AMLOCK EVENT
Serena Hotel, Nairobi
Tuesday, October 28, 2014

Mr. Sandeep Khapre, Group CEO of BDO East Africa;
Chief Executive Officers of Commercial Banks and other
Financial Institutions;
Distinguished Ladies and Gentlemen:
I am indeed honoured to be with you at this important event
convened by BDO and 3i InfoTech. Before I make my remarks
allow me to thank the management of BDO for inviting me to
this conference as a guest speaker. This event will showcase one
of the globally known Anti-Money Laundering solutions
“AMLOCK” which is offered by 3i InfoTech. I have also been
made aware that AMLOCK has been implemented by more than
80 clients in over 20 countries across the globe that also
includes some of the Kenyan banks.
Ladies and Gentlemen; as you may be aware, Kenya’s AntiMoney Laundering and Combating the Financing of Terrorism
(AML/CFT) regime since June 2009 had been under review by
the International Cooperation Review Group (ICRG). Kenya was
initially referred to the ICRG for being a high risk
area/jurisdiction and the absence of anti-money laundering
and terrorist financing laws. Over time Kenya has addressed
the deficiencies that led to the Financial Action Task Force
(FATF) review process. Some of the measures that have been
undertaken include:

Enactment and amendments of the Proceeds of Crime and
Anti-Money Laundering Act (POCAMLA), 2009 and its
regulations – which among other issues provides for the
criminalization of money laundering, establishment of an
independent institution responsible for AML/CFT issues –
the Financial Reporting Centre (FRC). The FRC’s objective
among others includes assisting in the identification of
proceeds of crime and the combating of money laundering.
Enactment of the Prevention of Terrorism Act (POTA),
2012 and its regulations – which among other issues
provides for the criminalization of terrorism financing
and the mechanism for implementing United Nations
Security Council Resolutions with regard to terrorism
financing.
In May 2014, Kenya underwent an onsite assessment by the
Africa/Middle East Regional Review Group to ascertain the
extent to which the country had addressed AML/CFT identified
deficiencies. The onsite team observed that Kenya had a clear
commitment at both the political and technical levels to
continue the development of its AML/CFT regime and there was
an adequate institutional framework to pursue the reforms
going forward.

Ladies and Gentlemen; it is on the basis of the on-site visit
report that the FATF concluded that Kenya has established the
legal and regulatory framework to address the strategic
deficiencies that had been identified. In view of these positive
developments, Kenya was subsequently removed from the FATF’s
monitoring process under its on-going global AML/CFT
compliance process. However, Kenya will continue addressing
and improving on its AML/CFT regime under the Eastern and
Southern Africa Anti-Money Laundering Group (ESAAMLG).
Ladies and Gentlemen: On its part, the Central Bank has
continually enhanced the regulation and supervision of the
financial system in order to improve the sector’s integrity. As
part of our efforts in ensuring appropriate and effective
oversight, the Central Bank first issued AML Guidelines in
1996. These Guidelines were revised in 2000, 2006 and
subsequently overhauled in 2012 to reflect the prevailing
international best practice and to align them with the proceeds
of Crime and Anti-Money Laundering Act, 2009 (POCAMLA).
Ladies and Gentlemen; in 2013, FRC entered into
Memorandum of Understanding (MOU) with the respective
domestic financial sector regulators comprising the Central
Bank of Kenya, Capital Markets Authority, Insurance

Regulatory Authority and the Retirement Benefits Authority.
The MOU provides for supervision and enforcement of
POCAMLA by the supervisors with respect to institutions under
their purview. The MOU also provides for the exchange of
information that is necessary to support effective anti-money
laundering supervision of financial institutions.
Ladies and Gentlemen; money laundering and terrorism
financing have far reaching implications on the credibility
and stability of the financial system as well as to national
security. I therefore applaud BDO and its partner 3i InfoTech
for their pro-activeness in developing AML/CFT solutions. These
solutions and others in the market will facilitate financial
institutions in meeting their AML/CFT legal and regulatory
requirements effectively and efficiently. This will in turn foster
the integrity of Kenya’s financial sector putting it in good
standing globally.
With those few remarks I wish you fruitful deliberations.
Thank you