Anti-money Laundering Law in Ethiopia: Analysis of its Enforcement with Specific Reference to the Responsibility of Banks

Abstract

Banks are among the institutions which take the leading role in the war against money laundering. They, however, remain highly vulnerable to an ever growing means and mechanisms of perpetration of the crime of money laundering. Such a reality demands a continues adoption of measures necessary to combat their involvement in the commission of this crime. In what appears to be responding to this demand, Ethiopia has enacted several laws imposing obligation on Banks to take preventive measures that can avoid manipulation of the financial system towards the commission of the crime of money laundering. Nonetheless, there exists no comprehensive study focused on assessing how Banks are complying with the requirements of anti-money laundering legislation. This research aims at examining whether Banks (both private and public) in Ethiopia are implementing measures intended to prevent the commission of money laundering. Besides, it studies the relationship and collaboration between the Banks and the regulatory organs (such as the Financial Intelligence Unit and the National Bank of Ethiopia) in identifying and removing a system that allows the use of Banks as intermediaries in the commission of money laundering.