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| Africa Subsaharan |
| Bank of Uganda: ForEx boom could be funding terror |
| 2009-05-16 |
| The huge amounts of money handled by private forex bureaus could be a threat to the country and the region if foreign exchange rules are disregarded, the Bank of Uganda has warned.In a meeting held in Kampala by forex bureaus and money remittance operators on April 30, the executive director of bank supervision at the Bank of Uganda, Justine Bagyenda, raised the alarm on possible money laundering and financial terrorism. She said the laid-down guidelines should be adhered to as the country awaits the enactment of the Anti Money Laundering Law. Ms Bagyenda said an increase was reported in the inflows and outflows of licensed money remittances in the country that stood at the equivalent of $226.01 million in inflows and $104.20 million in outflows, at the close of December 2008. This was a tremendous improvement compared with $99.44 million and $40.59 million recorded inflows and outflows during 2007. UgandaÂ’s forex bureaus and money remitters operate under the Foreign Exchange Act of 2004 and the Foreign Exchange Remitters Act 2006. The two Acts provide for exchange of foreign currencies in Uganda and making of international payments and transfer of foreign exchange; and for other related and incidental matters. A survey by the EastAfrican reveals that many operators are not complying with Know Your Customer requirements and procedures drafted by the central bank. Privately run foreign currency exchange bureaus and money remittance outlets handled 30 percent of the net foreign exchange transactions in Uganda in 2008, but the regulators are concerned by increased laxity. The Bank of Uganda says the forex bureau and money remittance sector has remained largely buoyant, with a total of 122 forex bureaus and 75 money remittance outlets. But a few were not following operational procedures regarding identification of clients, leaving the country open to money laundering. |
| Posted by:Pappy |