22 Apr 2018

The Know Your Customer (KYC) initiative is important in protecting businesses from being abused and used to launder money and finance terrorism.

Speaking at the Insurance Institute of Botswana workshop held in Gaborone on April 19, NBFIRA Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) officer, Mr Kearabetswe Molefi said the KYC was meant for entities to know and appreciate its customers’ dealings.

Various experts from the insurance and banking sector attended the workshop where burning issues on money laundering, KYC and financial intelligence were discussed.

Mr Molefi stated that every non-banking financial institution was obligated to carry out its own KYC on its customers.

 “A person who transacts business with a specified party using false identification documents shall be guilty of an offence and liable to a fine not exceeding P100 000 or to imprisonment for a term not exceeding five years or to both,” he explained.

 Mr Molefi further explained that KYC also sought to protect entities from becoming vehicles for or victims of financial crime. In his presentation, Directorate on Corruption and Economic Crime (DCEC) representative, Mr Thatayaone Sesinyi explained that the vast majority of criminals were motivated by financial gain and thus money laundering had become an essential service for today’s criminal enterprise.

“Financial institutions should pay special attention to all complex, unusual large transactions and all unusual patterns which have no apparent economic or visible lawful purpose,” Mr Sesinyi said.

Again, Mr Sesinyi explained that Botswana was vulnerable to money laundering because of its low crime rate, political and economic stability and its liberal economy. ENDS