Act provides for the offence of money laundering and introduces measures for combating the offence; and provides for the identification, tracing, and confiscation of the proceeds of crime.
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· Section 3 provides that a person who engages in money laundering commits an offence while Section 4 creates an offence where any person uses, acquires or has possession of property that they know or ought to know that forms part of proceeds of crime. Section 5 provides that a person who willfully fails to comply with a reporting obligation commits an offence.
· Through the 2021 amendments to the Act, there was added “advocates, notaries and other independent legal professionals who are sole practitioners, partners or employees within professional firms” to the existing classes of businesses and professions namely: real estate agencies; casinos; accountants who are sole practitioners, partners or employees within professional firms; non-governmental organizations; and such other business or profession in which the risk of money laundering exists as the Cabinet Secretary may, on the advice of the Financial Reporting Centre, declare as part of designated non-financial businesses or professions. In addition, section 18(3) of the Act provides that the High Court may order an advocate to disclose information available to him in respect of any transaction or dealing relating to the matter under investigation, upon an application made in relation to an investigation.
· What this means is that lawyers and real estate agencies, which are usually contracted by parties in real estate transactions to facilitate the sale and purchase as well as lease and charging of properties including holding funds as stakeholders (in an escrow account) pending the finalization of the transaction, are under a legal obligation to report to the Financial Reporting Centre in case of suspicious transactions. Prior to this change in the law in 2021, lawyers were exempt from reporting. This legal development may reduce instances of money laundering through real estate, which is partly responsible for high house prices.
