Zim makes progress in anti-money laundering efforts

HARARE - Zimbabwe’s insurance and pensions sector is targeting to complete assessment of its exposure to money-laundering crimes.

The assessment is expected to “inform a Risk-Based Approach to Anti-Money Laundering and Combating of Financing of Terrorism (AML/CFT) supervision.”

The Financial Action Task Force (FATF) recommends that countries are required to identify, assess, and understand the money laundering and terrorist financing risks for the country, and should take action, including designating an authority or mechanism to coordinate actions to assess risks, and apply resources, aimed at ensuring the risks are mitigated effectively.

The insurance sector is typically vulnerable to white-collar crimes due to high levels of financial flows.

The Insurance and Pensions Commission (IPEC) is currently in the process of implementing a sector risk assessment, which is expected to be completed by year end.

“We envisaged completion of IRAs and Sectoral Risk Assessment by December 2020,” said IPEC director for pension supervision Cuthbert Munjoma during the AML/CFT awareness workshop for the insurance sector recently.

Following the completion of the assessment, IPEC has said there will be enhanced focus on AML/CFT supervision going forward.

Because of the role and structure of insurance and pensions business, players in the sector typically operate by moving funds from parties with excess capital to parties needing funds.

All things being equal this financial intermediation works to create efficient markets and lower the cost of conducting business.

But it also makes the sector a target for money launders. Money laundering has over the years become a potent threat to economies across the globe due to the rising volumes and sophistication of white collar crimes. –