FIC report significantly worrying – British envoy

BRITISH High Commissioner to Zambia Fergus Cochrane-Dyet says the 2018 Financial Intelligence trends Report is significantly worrying because the proportion of suspicious transactions has gone up. Meanwhile, Jonas Shakafuswa has suggested creation of a taskforce to follow up financial leakages and acts of economic plunder and to bring the culprits to book. The 2018 Financial Intelligence Centre report has revealed an increase in cases of suspicious transactions which now amounts to K6 billion, which is also an increase of 33 per cent from the 2017 reports.

In 2018, the centre analysed 176 suspicious transactions of which 80 were disseminated to law enforcement agencies. The report covered tax evasion, fraud, corruption and money laundering.

“The total value of the suspected offences in the disseminated cases was estimated ZMW 6.1 billion or about USD520 million. During the year, the FIC disseminated 80 reports of suspected money Laundering and terrorist financing to law enforcement agencies involving suspected financial crimes valued at ZMW 6.1 billion or about USD520 million which includes assessment by ZRA. The assessment period is from 1st January 2018 to 30 September 2018,” the report reads.

The report indicates that the offences covered and disseminated included tax evasion at K1 billion, Corruption, K4.9 billion, theft, K110 million, and fraud at K54 million. High Commissioner Cochrane-Dyet, who witnessed the launch of the FIC 2018 trends report, wondered weather Zambians understood how dangerous corruption was.

“FIC 2018 report is really significant… significant in a worrying way because it shows that the trend is negative, the proportion of suspicious transactions has gone up by 33 per cent but it’s positive because FIC is working with the law enforcement agencies with support from government and to tackle corruption,” High Commissioner Cochrane-Dyet said.

He added that as part of his role working with the government, he was very keen to stabilise and strengthen investor confidence. High Commissioner Cochrane-Dyet said it was very important for the Zambian government to keep an eye on how policies would be interpreted by international investors.

“I sometimes wonder weather everyone in Zambia understands how dangerous corruption is. Corruption kills people because government money which is stolen corruptly is money that can be spent on education, on health, social cash transfers, supporting poor Zambians and saving lives. I want to see more business being done by British [companies] with Zambia so I am very keen to stabilise and strengthen investor confidence and that’s part of my role – working with government. So the message that I relay to the government all the time when considering policy, whether it’s about taxes or employment laws, the way the mining companies are treated…it’s very important that the government keeps an eye on how those policies will be interpreted by international investors, that is how poverty will be eradicated in Zambia…” he said. “Government can’t end poverty on their own. If you look around the world where poverty has been eradicated, it’s being done by the private sector and partly that’s foreign investment.”

High Commissioner Cochrane-Dyet noted that debt was one of the big challenges facing Zambia. He said how Zambia tackles the huge debt would dictate how the international market and investors view the country.

“I have had discussions with government, individual ministers, His Excellence the President and I think the government understands this and a great deal of thought is being given to how they tackle this,” said High Commissioner Cochrane-Dyet.

Meanwhile, Shakafuswa, a former finance deputy minister and Katuba member of parliament, said as the Attorney General, Likando Kalaluka, noted at the launch of the 2018 Financial Intelligence Report, “enough legislations are already available to stop the rot”.

Shakafuswa said when he was a deputy minister, president Levy Mwanawasa tasked them to reduce slippage from government programmes.

He recalled that Mwanawasa held the view that the budget was not proving an effective tool in providing for the economy.

“We put together a group of technocrats headed by Dr Mulungushi [now late], who was appointed PS planning to bring up a process which ensured that we adhered to vision 2030 targets. It was noted at that particular time that despite providing in full for projects in a budgetary year, the results in most cases were below expectations. The basic function of the department was to plan, monitor implementation and report back for analysis budgetary performance,” he explained in a statement on his Facebook page. “The cardinal part was monitoring. The department brought in the anti-money laundering team from DEC to prosecute anyone who abused or made illegal gain of resources provided through the budget. Each Ministry provided for projects, which they wanted funding in a particular year, showing scope of works and requirements through bills of quantities. Immediately monies was released, monitors went out to check on the correctness of application. It was discovered that some works were below par because contractors were cutting corners.”

Shakafuswa explained that such were taken by DEC to court for money laundering.

“It brought in a lot of fiscal discipline and prudent management of resources. It will be noted that that year spending agencies failed to spend over K700bn,” he recalled. “But projects were on going. It was sad that the RB [Rupiah Banda] regime did away with the department, relegating it to a mere Directorate and hence the shame being brought about by the Financial Intelligence reports. The cure is a task force, independently selected should be put in place to follow up these leakages and acts of Economic Plunder to bring the culprits to book.”

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