97 companies get hefty penalties
NINETY-SEVEN (97) companies, excluding those in the financial services sector, have been slapped with hefty fines as much as US$300 000 by the Financial Intelligence Unit (FIU) for offences ranging from failure to report suspicious transactions, laxity in conducting customer due diligence and neglecting to undertake money laundering assessment risks.
The entities fall under the designated nonfinancial businesses and professions (DNFBPs), and include real estate agents, corporate trusts, accounting and auditing firms, law firms, car dealers and casino operators.
However, most companies penalised are in the real estate sector, followed by dealers in precious stones and precious metals. FIU recently launched a blitz against organisations involved in illicit financial transactions that are destabilising the exchange rate and prices. FIU director-general Mr Oliver Chiperesa told our Harare Bureau that the DNFBPs have been advised to put in place measures to prevent illicit transactions.
“In the last three weeks we have sent out penalty letters to 97 entities or the so-called designated non-financial businesses and professions (DNFBPs),” Mr Chiperesa said.
“There are six categories of DNFBPs, the so-called professional gatekeepers who are required to implement measures to help prevent entry of illicit proceeds into the financial system. The six categories are: law firms, accounting firms, estate agents, casinos, precious stone and precious metal dealers, car dealers and trust and corporate service providers (company and trust formation / management agents). They have not been adhering to their statutory obligations under the Money Laundering and Proceeds of Crime Act.”
In the past, he said, the regulatory approach in terms of fighting money laundering and terrorism financing has been focusing on banks and other non-bank financial institutions.
“But criminals have been increasingly making use of and abusing the other designated professions to mask and give credibility to their illegal transactions, hence the new shift to require DNFBPs to also implement robust antimoney laundering measures,” he said.
The real estate sector, at 72, has the highest number of sanctioned DNFBPs, followed by dealers in precious stones and precious metals (20), accounting and auditing firms (three), trust and corporate service providers (one) and casinos (one).
Real Estate Institute of Zimbabwe (REIZ) president Dr Mike Juru welcomed the FIU’s blitz, saying they do not condone illegal activities.
“The FIU is free to do its work because it is targeting criminals who are abusing financial facilities. One thing you should understand is that the FIU is not targeting Estate Agents,” he said.
“It’s also not saying all Estate Agents are doing that. It’s targeting criminals who are abusing financial facilities. So we support the FIU in doing its work. As Estate Agents we have to work in the confines of the law and we have a moral obligation to do just that. If they are some who are breaking the law, the law should take its course,” he said.