Legal Update – 30 May 2019

Anti-Money Laundering Funds Transfer Regulations Issued

  • Mandatory report formats introduced with more details of remitter and receiver of funds
  • Strict reporting guidelines for lawyers and accountants
  • Reporting Person must now report to the FIU all transactions over USD 10,000 for currency transactions and USD 1000 (for electronic transfers)
  • Gaming activity operators to report cash transactions, payments on bets

On 24 May 2019, the Ministry of Finance and Planning published the Anti-Money Laundering (Electronic Funds Transfer and Cash Transactions Reporting) Regulations, 2019 (Regulations) vide GN No 420. The Regulations are made under section 29 of the Anti-Money Laundering Act.

Under regulation 4, every electronic fund transfer shall be accompanied with information required in the Second Schedule and every currency transaction shall contain information required in the First Schedule. Information that will now be required includes transaction information, place of transaction, purpose of transaction, information on person conducting the transaction, nationality of such person, date of birth, occupation in addition to full particulars and address of the beneficiary person.

Under regulation 5 it is now mandatory for every Reporting Person* to report to the Financial Intelligence Unit (FIU) (a) a currency transaction involving Tanzanian Shillings or any foreign currency equivalent to USD 10,000 or more in the course of a single transaction (b) an Electronic Funds Transfer involving Tanzanian Shillings or any foreign currency equivalent to USD 1,000 or more in the course of a single transaction.

In addition, every attorney, notary or independent legal professional is now required to report currency transactions when assisting clients in preparing or executing transactions involving purchase or sale of property or commercial enterprises, management of funds, opening of bank accounts, buying or selling of business entities, amongst others.

Similar provisions apply to accountants or accounting firms who are now required to report currency transaction when engaging in receiving or paying of funds, purchasing or selling securities, real properties or business assets or entities, transferring funds or securities by any means, management of funds amongst others.

Gaming activity operators are now also required to report cash transactions in respect of cash received from a customers; cash disbursed to a customer in the course of the redemption of chips, tokens or plaques and front cash withdrawals, payments on bets including slot jackpots amongst others.

Furthermore, the Regulations impose upon an intermediary institution to maintain all originator and beneficiary information that accompanies a wire transfer; keep a record for at least ten years of all the information from the ordering institution or another intermediary institution; have risk-based policies and procedures for determining when to execute, reject, or suspend an electronic funds transfer that lacks required originator or beneficiary information.

The Regulations state that an electronic funds transfer report or currency transaction report shall be submitted to the FIU (a) not later than five working days after the day of the transaction; (b) electronically or otherwise as required by FIU.

The Regulations further state that the FIU or regulator may, upon being satisfied that a reporting person has failed to report currency transaction or international electronic funds transfer according to these Regulations, impose administrative sanctions including warning not to repeat, reprimand, directive to take remedial action, suspension of business activity, fine up to TZS 5M, suspension or removal from office of any member of staff who causes or fails to comply.

To read a copy of the Regulations click here.

Vide GN 419, the Ministry of Finance and Planning has also issued the Anti-Money Laundering (Amendment) Regulations 2019 which amend parts of the Anti-Money Laundering Regulations 2012. To read a copy of this Regulation click here.

*Reporting Person as defined under the Anti Money Laundering Act includes banks and financial institutions, cash dealers, accountants, real estate dealers, dealers in precious stones work of arts or metal, a regulator, customs officer, attorneys, notaries and other independent legal professionals, and auctioneers.