The Reserve Bank of Zimbabwe’s Financial Intelligence Unit (FIU) says it has increased surveillance on car dealers as the car dealership industry is at high risk of money laundering.
Speaking to The Sunday Mail, FIU director-general Oliver Chiperesa said Zimbabwe is estimated to be losing between US$1 billion and US$1.5 billion through money laundering. He said:
"However, there is no international standard on car dealers but countries are left to add sectors they feel are at high risk of money laundering.
As for us, we added the car dealership sector as one of the areas where money laundering could be taking place.
So, at the moment, we actually don’t have a register to say who the registered car dealers in Zimbabwe are because we don’t have a regulatory authority that registers them. I think that’s going to be the starting point, so we still have a lot to do…
So, the next step is to make sure that they are registered and regulated by someone who is not FIU. FIU only comes to deal with the anti-money laundering aspect…"
Chiperesa said there should be records of every car sold so that it becomes easier to flag any suspicious transactions. He said:
There needs to be records of every car sold. It will be easier to follow up when records are maintained and suspicious transactions are reported. Sometimes, the transactions are not recorded because we use cash.
"At least, the easy thing about buying houses is that we can go to check at the Deeds Office when ownership changes, but with vehicles, one can buy a vehicle and not change ownership."
Zimbabwe Republic Police acting commanding officer for the Commercial Crimes Division (Northern Region) Superintendent Godwin Mvurume said:
"We have adopted what we call the follow-the-money concept. Financial crime is a financial benefit. The benefit is money.
We are trying to follow the money and engage the courts in order to freeze and seize assets.
The car dealers are reluctant to supply information… We are engaging FIU so that we come up with a workable solution."
Money laundering refers to the illegal process of making unlawfully obtained money appear legitimate.
It typically involves a series of financial transactions that disguise the true origin of the funds, making them appear to come from a legitimate source.
Money laundering is commonly associated with criminal activities, such as drug trafficking, corruption, fraud, and organized crime.
The purpose of money laundering is to conceal the illegal origins of money and integrate it into the legal financial system, making it difficult for authorities to trace and identify the proceeds’ true source.