Kenya has intensified its fight against money laundering and terrorism financing by placing dealers in precious metals and stones under stricter regulatory oversight.
This is part of efforts to address deficiencies that led to its grey-listing by the Financial Action Task Force (FATF) in 2023.
Beginning Friday, the Financial Reporting Centre (FRC) will commence a sweeping review of hundreds of licences held by gold, silver, and diamond dealers who failed to register with the FRC.
Those not in compliance will face suspension until they meet new legal requirements.
FRC Director General Saitoti Maika said the move is aimed at disrupting networks that use precious metals in trade-based money laundering schemes.
“Precious minerals have been utilised to launder illicit funds through fake invoices, price manipulation, and tax evasion,” he said.
The new rules require dealers to report any cash transaction exceeding $15,000 and retain accurate records of clients, including identification and ownership information.
Dealers must also submit key documents such as a certificate of incorporation, KRA PIN, mining licence, group structure, and details of ultimate beneficial owners.
Foreign shareholders must provide passport copies and fill out a detailed statistical questionnaire.
The reforms align with proposed amendments to Kenya’s Proceeds of Crime and Anti-Money Laundering Act, which seeks to hold metal and gemstone traders to the same reporting standards as banks and other financial institutions.
Kenya’s grey-listing has affected its global financial standing, making foreign transactions and investment more difficult.
Similar regulatory gaps in neighbouring countries have also raised concerns about regional vulnerability to financial crimes.
Authorities hope these stringent measures will reassure international partners, close loopholes in the financial system, and ultimately help Kenya get delisted from the FATF’s watchlist—restoring investor confidence and reinforcing its commitment to global compliance standards.
