After the Anti-Money Laundering Bill was accented into an Act of Parliament, the Financial Intelligence Authority has been set up. Senior lawyer, Sydney Asubo was appointed the interim Executive Director, Below are excerpts of an interview he gave Sam Nabwiiso.
Question: Please give us the background to setting up FIA?
Answer: : FIA is an independent government institution established under section 18 of the Ant-Money Laundering Act of 2013. The Authority operates under the supervision of the board with head offices in Kampala, but the law allows the Authority to have branches outside Kampala if resources are available.
The Authority has objectives such as enhancing the identification of proceeds of crimes and combating money laundering.
The Authority also has the mandate of creating public awareness about matters related to financial laundering in the country. In meeting our objectives, the Authority works with relevant government institutions like the Bank of Uganda, Immigration department to exchange information relating to money laundering. Currently, we are leaving in a global world and that is why at the global level we work with the Financial Action Task Force(FATF) which is the global institution responsible for fighting money laundering in the whole world.
What personally do you bring to the table, have you had experience in the kind of investigations FIA will be involved in?
The Law requires people who are experienced either in the law, finance, criminal investigation all are brought on the board. For the Executive Director, the laws stipulates that the ED, heshe must be person of integrity with no criminal scandals at all with wide experience in law, administration, economics, banking and finance.
The reason why we prefer people of different professionalism is the kind of work the Authority will be dealing with. This requires people who are professionals in different professions. For example, if the case is about bank transactions, the Authority will need someone who can analyse financial statements or cash flows. In certain organizations, at individual level, that person must be an accountant or banker. We shall need land economists surveyors to help the Authority in calculating the value of the land that is why we are going to have many professionals working at the Authority. .
Was there any Development Partner involvementersuasion, or was this purely a Uganda government initiative?
Its Government of Uganda because FATF requires countries globally to be members of FATF. If not, countries that are not members of FATF are required to be members of the regional groups called the regional FATFs. Uganda is now a member of the Eastern and Southern Africa Ant–Money Laundering Group because the international anti-money laundering obligations require all countries to have an financial intelligence system in place. This helps in fighting money laundering at a global level.
Who takes precedence in terms of authority, FIA or Bank of Uganda?
Bank of Uganda deals with financial institutions under the Financial Act. Its major role in the Act is to regulate financial institutions such as commercial banks microfinance institutions and the non-banking sectors such as the mobile money. But the FIA covers wider areas as compared to BOU. As an Authority we go beyond financial institutions to mention but few. The Authority monitors suspicious money laundering in the followings sectors, aocates , casinos, real estate, dealers in precious metals and gems, financial institutions, registrars of companies , the Uganda Investment Authority. All licensing authorities in Uganda among other institutions where money laundering can exist.
Considering the wide scope of FIA responsibilities do you have adequate personnel and money to be effective?
We have just come into existence, but with the mandate the Authority have, there’s need for a lot of personnel to be recruited given the nature of the work the Authority is supposed to deliver. Our intention is now to increase on the number of staff at the Authority. Now we are only nine. In the near future we should recruit more personnel with competitive skills and we shall also need sufficient funds but all these will be realized in the next financial year 20152016. This year the Authority is just building the foundation.
Commercial banks and other financial institutions quickly come to mind as your main focus, but what other businesses will you monitor?
Commercial banks are very happy with the establishment of FIA because the Authority will be helping them in fighting such crimes in the sector. As an Authority, we have been having meetings with Uganda Banker Association and most of the banks have anti-money laundering systems as demanded by the regulator BOU.
What specific areas of wrongdoing is FIA looking at?
Any Ugandan who has committed a crime in money laundering will be our main client. As an Authority we shall, not care who has stolen the money, embezzled government funds and sent the proceeds through money laundering techniques. The Authority will get him either in the country or outside the country using the existing mechanisms.
Will you have powers of prosecution?
No. The Authority has no legal mandate to prosecute the offenders. When the Authority completes the investigation, the findings will be shared by other relative government agencies such as the office of the Inspector General of Governemt and the Directorate of Public Prosecutions. If the findings reveal that there is criminal offences committed then the DPP’s office will take over the case. If the case involves governments money, the IGG’s office will take over and prosecution commences.
What is the relevancy of the Authority in the struggle to fight corruption in the country where Government funds have been embezzled?
To commit money laundering, one need to commit another offence. Most of the money used to commit money laundering is from corruption. But under the current law and the power of the Authority, we are going to confiscate peoples’ property which has been procured or constructed using the money found to be laundered,
As an Authority we are going to tightened the fighting of corruption. If the office of the IGG tighten their efforts to catch thieves, then we also at the Authority, shall tightened to catch money laundering clients.
What are the negative consequences of money laundering in an Economy like Uganda?
Money Laundering distorts the country’s economy, especially if money is stolen in two ways. If the money is stolen from outside Uganda and banked in Uganda, such money may cause inflation, because such money is invested in properties such as real estate. Many fraudsters tend to buy properties at high prices. This may result into higher prices for rents, land and the general prices for basic goods such as food, clothes among other items on the market.
On the other hand if the money laundering is an out flow, this will affect service delivery. If the money involved is government money, then this greatly affects the efficiency of services delivered by the government.
Source : East African Business Week