Friday, August 19, 2022

Zambia

55 bank accounts worth $30.3 million were frozen by FIC in 2021

Financial Intelligence Centre-FIC

ACC froze 55 bank accts in 2021, report reveals

By Oliver Chisenga

IN 2021 the Financial Intelligence Centre froze 55 bank accounts held in eight commercial banks; the Centre has revealed.According to the 2021 seventh FIC money laundering and terrorist report, the amounts frozen were US $30.3 million, K292.9 million and 1,685.31 Euros.

The report which was launched at Pamodzi Hotel in Lusaka further said the majority of accounts frozen were on grounds of suspected theft, corrupt activities, tax evasion and money laundering.

Further, the report said in 2021, FIC observed an unusual increase in the usage of cash in transactions despite the growing ease of transaction through electronic payment systems across the financial sector.

The report added that the trend was observed in several sectors of the economy, notably the banking, construction, manufacturing, agriculture and in businesses such as legal services and real estate.

It said in the construction sector, a series of large cash deposits and withdraws by constructors especially those engaged with public works were observed.

“A similar trend was observed with suppliers engaged in public procurement, especially during the first, second and third quarters of 2021,” read the report.Furthermore, the report said the prominent influential persons (PIPs) and their associates facilitated the awarding of contracts and were mostly beneficiaries of the contracts.

“In the period under review, the majority of suspicious transaction reports (STRs) submitted related to the use of cash by foreign nationals that had incorporated companies using Zambian nationals as proxies,’’ the report said further. ‘’The foreign nationals who were identified as beneficial owners would transact on the accounts with different banks with the sole purpose of externalising funds, in the guise of importing goods from foreign jurisdictions. Deposits would be made into different accounts by related parties and immediately the funds would be transferred to a foreign country, Asia being the main destination. This trend was observed in the analysis of STRs.”

And the report said there was an increase in both the number and value of the Cross Boarder Currency Declaration Reports (CBCDRs) in the period under review.

“It was however noted that no Cross Boarder Currency Declaration Reports were received. From border posts assessed to be porous such as Nakonde showed that traders conducted a high volume of cross border transactions in cash,” said the report.

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