Monograph 108 complete download - Institute for Security Studies

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CHAPTER 2
DETECTION AND SUPPRESSION OF MONEY
LAUNDERING IN TANZANIA
Eugene E Mniwasa
Introduction
In the recent past organised criminal activities, of which money laundering and
the financing of terrorism form part, have been on the increase in Tanzania. The
incidence of smuggling, poaching, trading in illicit drugs, corruption, fraud,
embezzlement, misappropriation and theft of public funds, racketeering, illegal
arms dealing and, most recently, terrorism, have been on the rise. 1 Criminals
generate substantial revenues and apply different mechanisms to disguise the
origins or ownership of the proceeds of their illicit activities. The increase in
organised criminal activities has been facilitated by several factors including
globalisation, liberalisation of the economy and advances in communications,
including information technology.
Globalisation has had several impacts on criminal activities. First, organised
criminal activities have become transnational and de-territorised. Criminals take
advantage of the global marketplace to trade in illicit drugs, traffic in persons,
commit fraud and carry out other transnational crimes. Second, criminals exploit
the revolution in global finance. Changes in information technology, in particular,
have made it easier for criminal assets to move across national borders through
financial markets that are out of the reach of the law. The internationalisation of
crime has thus occurred in response to the increased movement of persons, the
free flow of capital and the globalisation of financial services and the revolution
in communications. These have provided opportunities for laundering the
proceeds of criminal acts through investment in various sectors of the local and
global economy.
Efforts to combat organised criminal activities in Tanzania have focused on
preventing money laundering and the financing of terrorism. This is because
there is an increasing recognition that money laundering is an inherent feature of
international and organised crime. It is through the process of money laundering
activities that criminal activities, such as the trade in illicit drugs, firearms trafficking,