Continue with Facebook
Continue with Email
AML/CFT - you might have come across these abbreviations lately in your practice as a real estate agent or as a client buying a property through an agent and wondered what it means and why all of a sudden is it being prioritized by regulators.
AML/CFT is an abbreviation for Anti Money Laundering and Combating Financing of Terrorism. The first anti-money laundering structures came about with the Financial Action Task Force (FATF). It ensures that international standards are put in place to prevent money laundering globally.
Here in Zimbabwe AML/CFT measures are being spearheaded by the FIU – Financial Intelligence Unit and through sectoral regulators for Designated Institutions such as the Reserve Bank of Zimbabwe (RBZ) for Banks, Estate Agents Council of Zimbabwe (EACZ) for Estate Agents, Law Society of Zimbabwe for Lawyers, etc.
AML/CFT controls are being implemented with an intention to mitigate the adverse effects of criminal economic activity and promote integrity and stability in financial markets, real estate market included.
Anti-Money Laundering (AML) is a set of policies, procedures, and technologies that prevents money laundering. It is implemented within government systems and large financial institutions to monitor potentially fraudulent activity.
Terrorist financing uses funds for an illegal political purpose, but the money is not necessarily derived from illicit proceeds. Countering terrorism financing is therefore an essential part of the global fight against terror threat through CFT measures.
The main statutory function of the FIU in Zimbabwe is to oversee compliance with AML/CFT legislation and regulatory requirements by designated institutions.
Designated institutions are those institutions defined in the Money Laundering and Proceeds of Crime (MLPC) Act either as financial institutions or as designated non financial businesses and professions. Persons or entities operating in the real estate sector that are registered or are required to be registered in terms of the Estate Agents Act [Chapter 27:17] are also referred to as designated institutions hence the need to fully understand and abide by the regulations.
Estate agency businesses are required to undertake due diligence on both the seller and the buyer, with due regard to the money laundering and terrorist financing risks involved.
The MLPC Act imposes obligations on designated institutions to report suspicious transactions to the Financial Intelligence Unit. A designated institution shall prepare and submit Suspicious Transaction Reports (STRs) to the Unit, if it has reasonable grounds to believe that the transaction involves proceeds of crime, or is linked to or intended for financing of terrorism.
