Today Financial Crime News has updated its Kenya Financial Crime Dashboard in the new format. This new format includes, for example approx 150 data points which have been collected and are represented in the 2 page Financial Crime Dashboard. It informs as to the nature of the financial crime threats, the main vulnerabilities, how resilient Kenya is to these threats and its overall level of response, with more KRI and KPI data than ever before, all from publicly available sources albeit assessed and analysed for accuracy and relevance by FCN. For a copy of the December 2023 Dashboard for Kenya see HERE: FCN Kenya Dec 2023 Pbd 2
FCN Country Risk Scores & Ratings: Kenya is rated 71/100 and having a Moderate to High Threat level, with a “Moderate” Response at 55/100, resulting in an overall Risk of Moderate – High at 63/100, using the FCN Methodology. Whilst there is significant room for improvement the rating is better for example than that for FATF Members, China (77), Turkey (80), China (77) & Russia (78), & ahead of African Peers Nigeria (69), & equal with South Africa (63) but a long way behind those leading in Africa – Mauritius (26) and the Seychelles (33). Note: should Kenya be greylisted as expected its overall risk score will increase to 68.
Financial Crime Threats: The Highest rated threats are from: fraud, drug trafficking, organised crime, corruption & economic crimes. Medium rated threats are from: tax offences, environmental crimes including Illegal Wildlife trafficking, goods piracy, cybercrime & money laundering. Whilst terrorism remains a threat, particularly from Al Shabaab, Kenya’s rating in the Global Terrorism Index, which measures the direct and indirect impact of terrorism, has fallen somewhat from over 7/10 in 2014 and 2015 (where higher scores reflect a greater impact) to 6.166/10 in 2022, but with still a High rating and the 20th highest rating of over 170 countries assessed.
Organised Crime: Kenya is ranked 16th highest globally (out of 193 Countries) for criminality in the Organised Crime Index updated in 2023, behind top 5 Myanmar, Colombia, Mexico, Paraguay, & DRC. Regional African peers Nigeria and South Africa were ranked 6th and 7th respectively. See OCI 2023
Sector Vulnerabilities: The banking sector has been assessed as the sector with the highest threat and with a medium high vulnerability, so overall has the highest impact on ML vulnerability. Other sectors with elevated vulnerabilities are real estate, money remittance providers, foreign exchange bureaus, car dealers, lawyers, certified secretaries, gaming and sacco’s (co -operatives).
Responses: Based on the results from the 4th Round MER, it’s hard to see anything other than Kenya’s future inclusion on the FATF Grey List, alongside recently added South Africa and Nigeria which would raise even more questions about Africa’s ability to respond as expected by FATF, and whether the relative threats from these Countries are being fully taken into account despite the obvious response weaknesses. Kenya is Compliant in just 2/40 Recommendations, Largely Compliant in just 1/40 Recommendations, Partially Compliant in 26/40 Recommendations and Non Compliant in 11/40 Recommendations. On Effectiveness, Kenya received 0/11 Highly Effective Ratings, 0/11 Substantially Effective Ratings & 2/11 Moderately Effective Ratings & 9/11 Low Effective Ratings. The ME ratings were for IO2 (International Co Operation),IO3 (Supervision), IO8 (Confiscations).
