TI-Z PRELIMINARY RESPONSE TO THE 2024 FIC TRENDS
REPORT
Transparency International Zambia (TI-Z) commends the Financial Intelligence Centre (FIC) for publishing the 2024 Trends Report.
The report indicates that the FIC detected suspected Illicit Financial Flows (IFFs) worth USD $3.5 billion, mostly associated with commercial activities perpetuated by multinational enterprises.
In line with our recent study on risk factors for IFFs in Zambia, TI-Z calls for urgent government action to addressing the risk factors contributing to IFFs. These include the high use of cash transactions, mobile money fraud, and false invoicing aimed at justifying international transfers through the banking sector, among others.
TI-Z notes that the FIC analysed a total of 18,330 STRs, reflecting a 16.8% increase from the 15,696 STRs analysed in 2023.
TI-Z is however disappointed that the FIC analysed less STRs related to public sector corruption, resulting in the low number of disseminations on corruption as compared to cases relating to money laundering, fraud and tax evasion.
TI-Z wishes to remind the FIC that public sector corruption is a dangerous vice, with serious economic and social consequences, and thus requiring greater attention.
However, it is commendable that the overall number of disseminated financial intelligence reports to the Law Enforcement Agencies (LEAs) and foreign competent authorities increased from 923 in 2023 to 951 in 2024, representing a 3% increase. Out of these cases, 10 related to corruption, an increase from 9 cases disseminated in 2023.
The report also notes that feedback received from LEAs on disseminated reports indicates that 3 convictions and 7 non-conviction-based forfeitures were secured, resulting in get in touch with the forfeiture of assets valued at USD $26.5 million and K71.5 million in properties and cash.
The 2024 Trends Report also indicates that Commercial banks continue to be the highest reporting entities, with 8,710 reports received in 2024, representing 96.9% of the total STRs.
However, in 2024, Casinos filed 17 STRs as compared to none reported in 2023, on account of heightened awareness and enhanced supervision efforts by the FIC.
TI-Z calls on the FIC to further increase its awareness activities and to enhance its supervision over law firms, accounting firms, real estate agents and dealers in precious stones and minerals, and trust and company service providers that did not submit any STRs to the FIC in 2024.
These professional enablers pose a high risk for both public sector corruption and illicit financial flows. It is impossible that no suspicious activities are happening in these sectors, companies or institutions.
TI-Z is conducting a comprehensive analysis of the 2024 Trends report and will issue a comprehensive follow-up media statement in due course.
Maurice K. Nyambe (Mr)
EXECUTIVE DIRECTOR