Kenya’s economy is this and that. Whilst the country has high unemployment rates, poverty of up to 52% and insurmountable debt of Ksh.7.1 trillion, Kenya is one of the top-ranked major laundering jurisdictions. No surprise there!

Generally, the country as a financial and attractive innovation hub in Africa, makes it vulnerable to ‘wash wash’ business because of its unique mobile money tech uptake( Apps )  and closeness to the Somali border.

Why are Kenyans getting into money laundering schemes? 

The state of the economy is a start. Frustrated Kenyans are tired of the ever-increasing financial constraints brought about by heavy taxes. To understand this level of frustration, just google Kenya begging IMF to not lend their Government more money. 

In as much as money laundering was officially made illegal in Kenya in 2009, Kenyans are following in the footsteps of HushPuppi & Nigerians/Congolese shady businesses by risking it all to get that paper because legit money doesn’t cut it anymore.

What is money laundering?

It’s the illegal process of making large amounts of money generated by criminal activities such as drug trafficking and terrorist funding. AKA ‘wash wash business’. The laundering process is to make money seem as if it is acquired through a legitimate source.

In Kenya, this shifty biashara is commonly linked to Nigerians using business fronts to ply this trade. Ask anyone to give you an example of who and how, and automatically, Oga comes up as a suspect.

Worldwide, online banking and Cryptocurrencies are the preferred methods. This explains why most governments are reluctant to approve crypto.

Want to understand how it works? Watch The Good Girls or Ozark,

How Does Money Laundering Work

Money laundering involves 3 basic steps to disguise the illegally sourced monies.

First, placement -How the money is introduced into the system breaking it into different deposits.

Secondly, layering,  in which money is shuffled around the system.

Thirdly integration. This is where the money has gone full circle and brought back to the perp as ‘clean’ money.

Money laundering is traditionally done through real estate, gambling in casinos and creating shell or local companies with no real offices.

How can you tell if someone is laundering money?

Do you have friends or are sceptical about a business that has very few clients & the owner is lavish and living the soft life? There is your trigger.

Also, look out for unusual transactions or financial activity that’s out of normal character. Do you see why Kenya is attractive to launderers? With so many daily transactions per user in a single day, it’s difficult to flag such.

Secondly, said person has a silent partner investing in their business, but the cash flow is inconsistent.

Thirdly, overpriced businesses charging 3 times the average cost price and barely see 5 customers in a day.

Fourth, delayed projects that never get off the ground or are never finished. i.e apartments that are always vacant or a building that has been in construction for longer than expected? Hello!

Money laundering charges in Kenya and penalties

Most of the money that comes from laundering in East Africa finances terrorism and drug trafficking. Remittance cases in Kenya in 2020 alone totalled up to 1.78 billion, with the government flagging a big chunk of it to financing the drug trade.

This high-risk scheme carries a heavy penalty. For a corporate body,  a fine not exceeding KShs. 25,000,000, or the amount of the property’s value involved in the offence.

For individuals,  you get up to 20 years behind bars as the minimum jail term for laundering.

On the extreme, death. And not the good kind.

How many ‘flashy’ ‘living large’ persons do you know who have been shot or died horrible deaths due to deals going south?

In Kenya, transactions over 1 million get flagged and the proof is required to justify the amount. The Kenyan government exacts harsh penalties for money laundering. Kashy advises to just don’t do it! It’s true that wash wash money gives you insomnia and stress as you are always paranoid.

Help us change for the better!
We need your vote to improve further and provide you with the best possible and free loan comparison site in Kenya!

1 Star2 Stars3 Stars4 Stars5 Stars (2 votes, average: 4.50 out of 5)