A clamp down on ill-gotten and unexplained wealth obtained by individuals involved in money laundering, crime and other illicit dealings has come into effect following the amendment of Statutory Instrument 246 of 2018 Money Laundering and Proceeds of Crime and Exchange Control Act by President Emmerson Mnangagwa.
A move around some of the northern suburbs of Harare might leave one mistaken to think that the houses there are somewhere in Beverly Hills, America where the well-to-do Americans reside.
This is because of the spacious mansions and expensive properties built there with top of the range vehicles parked outside despite a difficult economic environment that the country has underwent over the years.
The government will require owners of properties and assets to explain the source of their possessions following the amendment of the Money Laundering and Proceeds of Crime Act today.
“The act was long overdue because any property owner has to establish how they acquired their wealth against their incomes and establish whether they have paid all the necessary taxes,” said Mr Tich Zinyemba, a legal analyst.
Zimbabwe over the years became a favourable destination of proceeds of crime and illicit dealings such as externalisation of minerals, human and drug trafficking and other various forms of money laundering and it is high time the government makes individuals accountable for the source of their wealth after years of allegations of corruption including among public office bearers.
“It is of paramount importance to give confidence in the people that government is walking the talk in fighting corruption. The new law provides for those who have been accused in the past of stealing from government and using the proceeds to build big properties, as well as foreigners who come to Zimbabwe after being involved in crimes, to properly come clean on their wealth,” said Dr Gift Mugano, an economic analyst.
The amendment of the act requires the Zimbabwe Anti-Corruption Commission (ZACC), the National Prosecuting Authority (NPA), the Zimbabwe Republic Police (ZRP) or the Zimbabwe Revenue Authority (ZIMRA) to make an application of unexplained wealth order in respect of any property in possession of suspicious persons in the country.
“It will be up to the law enforcement authorities, otherwise the law becomes just a talk. Many people have accumulated unexplained wealth and are known but the government needs to demonstrate its seriousness in making that happen,” a retail analyst, Mr Denford Mutashu said.
Illegal foreign currency dealers with fat bank accounts are also targets of the new law.
Many countries have in place laws that prosecute money launderers and also confiscate any wealth that is not explained by its owners.
The amendment of the act will see the establishment of the asset management unit at the Reserve Bank of Zimbabwe with the powers to keep in custody assets or ill-gotten wealth or even sell and liquidate the proceeds of ill-gotten wealth.
The successful enforcement of the act will go a long way in making the country an attractive investment destination and public confidence in the fight against corruption.
Bulawayo residents welcome move on illegal forex dealers
Ordinary citizens in Bulawayo have commended President Emmerson Mnangagwa for invoking the Presidential Powers Temporary Measures Amendment of Money Laundering and Proceeds of Crime Act and the Exchange Control Act regulations 2018.
They said the move will curtail illicit financial flows that have seen the country being prejudiced of over US$5 billion in the past few years.
When the Bank of Jamaica pronounced the revised guidance notes on the detection and prevention of money laundering and terrorist financing activities in 2007, it mandated financial institutions to expose acts of illicit financial deals, where failure by the institutions to comply with the directive attracted prosecution for the banks.
In today’s open and global financial world characterised by a high mobility of funds and the rapid development of new payment technologies, the tools for laundering are many and some have been witnessed on our streets.
However, all this will soon be a thing of the past as government has taken a no nonsense approach to all those found liable of illegal financial dealings.
For residents in Bulawayo where the ‘osiphatheleni’ [illegal foreign currency dealers] were daring all and determining the market forces, the new regulation is good news.
“This is a great move by the government and we welcome it with excitement and enthusiasm that it will deal with these illegal foreign currency dealers. It is not normal to exchange money on the street, it must come to an end,” one Bulawayo resident said.
“This is good. Even though we would sometimes exchange money on the street, it is not good, money must be exchanged on the bank not in a dingy corner. People have been robbed sometimes,” another resident said.
“We welcome the move, at last the government has shown a bold stanza against the money changers who are making shops to increase prices. These people should be arrested,” another said.
Invoking the presidential powers in clamping money laundering and crimes acts is not peculiar to Zimbabwe as research shows that countries that embarked on such tight regulations registered success in restoring normalcy and transparency in financial markets