https://www.mwakilishi.com/article/kenya-news/2025-03-19/kenyan-lawyers-and-property-agents-flagged-in-us-money-laundering

Kenya's efforts to combat money laundering are facing significant hurdles, according to a recent report by the United States Department of State Bureau for International Narcotics and Law Enforcement Affairs, released in March 2025.

The report highlights persistent vulnerabilities within the country's financial system, particularly involving designated non-financial businesses and professions (DNFBPs) and informal remittance systems, despite Kenya’s commitment to strengthening its anti-financial crime mechanisms. The report identifies lawyers, estate agents, and notaries as key enablers, often unwittingly, of money laundering schemes. These professionals facilitate illicit financial flows through property transactions and the establishment of shell companies designed to conceal the origins of unlawful funds.

The management of trust accounts by some legal professionals further complicates enforcement efforts, shielding money launderers from scrutiny. Critically, a court injunction currently prevents the Kenyan government from mandating that lawyers report suspicious financial transactions, creating a legal impasse that hinders progress in aligning with anti-money laundering reforms.

Informal remittance systems, frequently utilized by foreign nationals, including refugees and ethnic Somali residents, provide channels for rapid and anonymous money transfers. The unlicensed nature of these services makes them vulnerable to exploitation by money launderers, particularly given Kenya's geographical proximity to Somalia and the presence of unregulated Somali sectors, such as the khat and charcoal trades, which contribute to illicit financial flows.

In February 2024, Kenya pledged to bolster its financial crime frameworks in accordance with an action plan set forth by the Financial Action Task Force (FATF). The report acknowledges that Kenya is actively addressing these threats through collaboration with international bodies and refinement of its detection systems. The partnership between Kenya and the United States exemplifies the importance of global cooperation in tackling transnational financial crimes.