1 day Ago By The Independent
Reports estimate that trade-based money laundering costs Uganda over $6.6 billion annuallyKampala, Uganda | JULIUS BUSINGE | Financial experts have called for sustained collaboration between Uganda’s public and private sectors to strengthen the country’s anti-money laundering (AML) framework, following its recent removal from the Financial Action Task Force (FATF) Grey List.The warning comes amid concerns that failure to maintain vigilance could reverse economic gains and deter foreign investment.
Uganda was grey-listed by the FATF from February 2020 to February 2024 due to deficiencies in its Anti-Money Laundering (AML), Counter-Terrorism Financing (CTF), and Counter-Proliferation Financing (CPF) frameworks.The country’s exit from the list in February this year marked a significant milestone, but experts caution that complacency could lead to regression.The country’s alignment with global AML/CFT standards has unlocked significant economic growth opportunities by improving access to trade and investment, while its now-recognized robust and resilient financial system protects institutional integrity and safeguards ordinary citizens’ interests through greater stability; this compliance has also enhanced international cooperation by reducing transaction scrutiny from correspondent banks, fostering smoother financial operations and bolstering Uganda’s position in the global economy.
Speaking at the Inaugural Anti-Money Laundering and Financial Crime Public-Private Sector Dialogue in Kampala on March 26, Wilbrod Owor, executive director of the Uganda Bankers Association (UBA), warned that money laundering poses a serious threat to Uganda’s economic ambitions.“The government’s ten-fold growth strategy depends on sectors like agro-industrialization, tourism, and mineral development—all of which require foreign investment,” Owor said. “But money laundering scares away legitimate investors, increases compliance costs, and makes cross-border transactions more expensive.
If we slip back into the Grey List, our economic progress will suffer.”BoU re-echoes concernsBank of Uganda Governor Michael Atingi-Ego rechoed these concerns, stressing that financial integrity is critical for stability and global credibility. “Money laundering and terrorist financing undermine the rule of law and public trust,” he said.
“With Uganda’s domestic savings insufficient to fund major projects, we must attract external investment—and that demands a secure financial system.”He highlighted recent reforms, including AML regulatory amendments, annual risk assessments, and stricter supervision, but emphasized the need for further action, such as establishing beneficial ownership registers and improving inter-agency cooperation.The economic toll of grey-listing was severe.
Foreign Direct Investment (FDI) dropped by 16% in 2020, according to Bank of Uganda data, while financial institutions faced higher compliance costs and restricted access to international banking networks.Godfrey Sebaana, the chief executive officer of Diamond Trust Bank (DTB), noted that Ugandan businesses bore the brunt of the grey-listing, with increased scrutiny from foreign banks and higher operational expenses.“Exiting the Grey List is a major achievement, but we cannot afford to relax,” he said.
“We must continue investing in compliance technology, strengthening oversight, and fostering public-private collaboration to prevent a relapse.”Financial crimes vs cyber threatsSaldys Jusu-Sheriff, Founder of Africa Risk Management and Compliance Partners, linked money laundering to rising cybercrime risks, urging businesses to adopt stronger cybersecurity measures.“Financial crimes and cyber threats go hand in hand,” he said.
“Better digital hygiene—such as secure passwords and updated anti-virus software—can help curb these risks,” Sheriff said.Reports estimate that trade-based money laundering costs Uganda over $6.6 billion annually, with gold and petroleum sectors being major targets.
To safeguard the economy, experts recommend ongoing regulatory reforms, enhanced monitoring, and sustained cooperation between government and industry players.As Uganda moves forward, the message is clear: maintaining financial integrity is not just a regulatory obligation—it is a necessity for long-term growth and global competitiveness.Share on: WhatsAppThe post Experts: Uganda must continue anti-money laundering reforms appeared first on The Independent Uganda:.
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