This archive report was first published on 13 September 2019.
On September 13, 2019, a Kenyan court dealt a significant blow to lawmakers' efforts to weaken anti-money laundering laws. Judge Weldon Korir ruled that amendments to the Finance and Banking Act were unconstitutional, as they did not undergo public participation.
The amendments, which were passed in October 2018, aimed to exempt large bank transactions from Know Your Customer Prudential Regulations. This would have allowed massive transactions to be carried out without scrutiny. However, the Central Bank of Kenya (CBK) had opposed the changes, warning that they would create a safe haven for illicit transactions and lead to international lenders blacklisting Kenyan banks.
According to Judge Korir, the National Assembly had 'gone off course' and taken an unconstitutional route. He noted that parliament had not denied failing to subject the amendments to public participation, and therefore, the DNA of the amendments was 'defective'.
CBK Governor Patrick Njoroge had previously testified that the amendments would impede the fight against corruption and open doors for money laundering. He warned that the changes would create confusion and chaos in the banking sector.
Justice Korir's ruling has been seen as a victory for anti-money laundering efforts in Kenya.
