According to a 2007 U.S. Department of State (DoS) International Narcotics Control Strategy Report, Tanzania is characterized by a weak anti-money laundering (AML) and combating the financing of terrorism (CFT) regulatory and supervisory framework, in particular with regards to financial institutions and law enforcement capabilities. The DoS report adds that there is no functioning financial intelligence unit in Tanzania, legislation does not address due diligence, and reporting is conducted on a voluntary basis. Legal requirements to file suspicious transaction reports have been issued by the Bank of Tanzania but are not enforced. In 2006, Tanzania proposed AML legislation that would provide for the creation of a financial intelligence unit. The AML law was expected to be implemented by February 2007. As of November 2007, however, there is little information available regarding the implementation of this law. Tanzania is a member of the Eastern and Southern Africa Anti-Money Laundering Group, which seeks to intensify efforts to implement the 2003 Forty Recommendations and the 2001 Nine Special Recommendations on Terrorist Financing of the Financial Action Task Force (FATF).

General Overview

According to a 2007 U.S. Department of State (DoS) International Narcotics Control Strategy Report, Tanzania is characterized by a weak anti-money laundering (AML) and combating the financing of terrorism (CFT) regime, in particular with regards to financial institutions and law enforcement capabilities. Furthermore, the law enforcement unit lacks training and resources and there is no financial intelligence unit (FIU). The DoS report adds that, in 2006 Tanzania proposed AML legislation that would provide for the creation of a FIU, require mandatory suspicious transaction reporting, and strengthen provisions to criminalize cash smuggling. The AML law was expected to be implemented by February 2007. As of November 2007, however, there is little information available regarding the implementation of this law.

Although the 1991 Proceeds of Crime Act criminalizes money laundering related to narcotics, it does not adequately define money laundering, according to the 2007 U.S DoS report. Financing of terrorism is criminalized under the 2002 Prevention of Terrorism Act. Legislation does not address due diligence, and reporting is conducted on a voluntary basis. Legal requirements to file suspicious transaction reports (STRs) have been issued by the Bank of Tanzania (BoT) but are not being enforced. As noted in the same report there haven't been any convictions or prosecutions related to money laundering of financing of terrorism in Tanzania over the past years.

The Government of Tanzania has ratified the 1988 United Nations (UN) Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances, the 1999 UN Convention for the Suppression of the Financing of Terrorism, and the 2000 UN Convention against Transnational Organized Crime. Tanzania is a member of the Eastern and Southern Africa Anti Money laundering Group (ESAAMLG) - a Financial Action Task Force (FATF) style regional body - and hosts the annual ESAAMLG task force meeting. The objective of the ESAAMLG is to intensify efforts to implement the 2003 Forty Recommendations and the 2001 Nine Special Recommendations on Terrorist Financing of the FATF. The Group also seeks to apply AML measures, and implement any other measures contained in multilateral agreements, as noted on its website.

The Principles

1. Legal Systems and Related Institutional Measures

NC

As stated in the 2007 U.S. DoS report, although the 1991 Proceeds of Crime Act criminalizes money laundering related to narcotics, it does not adequately define money laundering. According to the same report, terrorism financing is criminalized under the 2002 Prevention of Terrorism Act. Tanzania is characterized by a weak AML/CFT regime, in particular with regards to financial institutions and law enforcement capabilities. Furthermore, the law enforcement unit lacks training and resources, and there is no FIU. In 2006, Tanzania proposed AML legislation that would provide for the creation of a FIU, require mandatory suspicious transaction reporting, and strengthen provisions to criminalize cash smuggling. The AML law was expected to be implemented by February 2007. As of November 2007, however, there is little information available regarding the implementation of this law. Tanzania has ratified the 1988 UN Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances, the 1999 UN Convention for the Suppression of the Financing of Terrorism, and the 2000 UN Convention against Transnational Organized Crime.

2. Preventive Measures - Financial Institutions

NC

According to the 2007 U.S. DoS report, legislation does not address due diligence and reporting is conducted on a voluntary basis. Legal requirements to file STRs have been issued by the BoT but are not being enforced.

3. Preventive Measures - Designated non-Financial Business and Professions

NC

According to the 2007 U.S DoS report, nonbank financial institutions, including cash couriers, casinos, hawaladars (brokers of informal value transfer systems) and bureaux de change, are not subject to money laundering controls and reporting requirements. Furthermore, they are not required to report suspicious transaction. The BoT supervises the bureaux de change through annual audits and inspections. The main sources of criminal proceeds are in the real estate and used car businesses. Casinos, which are supervised by the National Gaming Authority, have also become an area of concern for money laundering, as noted in the 2007 U.S. DoS report.

4. Legal Person and Arrangements & Non-Profit Organizations

II

There is insufficient information publicly available regarding Tanzania's compliance with this Principle.

5. National and International Co-operation

II

As stated in the 2007 U.S DoS report, Tanzania is a member of the ESAAMLG - a FATF-style regional body - and hosts the annual ESAAMLG task force meeting. The objective of the ESAAMLG is to intensify efforts to implement the 2003 Forty Recommendations and the 2001 Nine Special Recommendations on Terrorist Financing of the FATF. The Group also seeks to apply AML measures, and implement any other measures contained in multilateral agreements, as noted on its website. Tanzania is not currently a member of the FATF. Tanzania has ratified the 1988 UN Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances, the 1999 UN Convention for the Suppression of the Financing of Terrorism, and the 2000 UN Convention against Transnational Organized Crime. Nevertheless, there is insufficient information publicly available regarding Tanzania's compliance with this Principle.