The United States has named the real estate sector as one of the main conduits of dirty money in most African countries including Kenya, Tanzania and Senegal.
A new report from the US State Department shows that lawyers, real estate agents and notaries are fast becoming money laundering avenues for their roles as designated nonfinancial businesses and professions (DNFBPs).
Real estate was flagged as a soft target for criminals who want to clean their ill-gotten money mainly due to the high participation of unregistered players that are not regulated and the use of cash.
The US says that DNFBPs whose transactions are largely cash-based, poorly documented, and loosely overseen by authorities are at great risk for money laundering and facilitating financial terrorism including lawyers, notaries, accountants, real estate brokers, construction companies, and jewelry/precious metal traders.
“Criminal activities within Tanzania that have a nexus to money laundering include transnational organized crime, tax evasion, corruption, smuggling, trade invoice manipulation, narcotics trafficking, intellectual property violations, counterfeit goods, wildlife trafficking, and terrorism,” said the DOS.
“Other susceptible sectors include Tanzania’s underregulated ports, mining, real estate, retail goods and services, and tourism. Front companies, hawaladars, and currency exchange operations launder money, especially in Zanzibar.”
The report also lists casinos, dealers in precious metals and stones, NGO’s, accountants who are sole practitioners, partners or employees within professional firms, trusts and company service providers as facilitators of illicit flow of cash.
In 2024, Kenya was put under a watch list referred to as a “grey list” for failing to have strong safeguards against money laundering.
The US blames Kenya’s proximity to Somalia for engagement in money laundering activities including trafficking illegal narcotics, humans, weapons, wildlife, timber, charcoal, and minerals.
“Trade-based money laundering remains a significant risk, with Kenya’s proximity to Somalia attracting funds from unregulated Somali sectors like the khat and charcoal trades,” added the DOS.
The DOS adds that Senegal is exposed to risks from organized crime, drug trafficking, internet fraud and DNFBPs, along with cross-border movement of funds and goods, are the most frequently used money laundering or terrorist financing channels.
Foreign ownership and management impact the gaming industry, including online sports betting and cryptocurrency-enabled gambling. The Directorate of Public Accounting and Treasury oversees the lottery and LONASE.
Senegal supports gaming supervisory bodies and performs risk mapping. Targeted administrative financial punishments have decreased gambling enterprise risks between 2023 and 2024. Major
