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Central bank tightens money transfer laws

Ntsebeng Motsoeli

The Central Bank of Lesotho (CBL) has released the Financial Institutions Money Transfer Regulations for the year 2014.

SX 13The regulations seek to clarify procedures of registering, licensing and supervising the country’s money transfer institutions, in an effort to ensure more control of the sector.
“Under the regulations, money transfer business registration procedures, licensing requirements and supervision of money transfer business institutions have been clearly spelled out,” reads a statement released by the CBL last week.
“Under these regulations, the Commissioner, among others, shall have the power to declare certain business practices undesirable, inspect the premises of the money transfer institutions, issue directives and take preventive measures against institutions which have contravened the provisions of these regulations.”

The regulations also mandate money transfer business institutions to establish procedures for preventing money-laundering and financing terrorist activities.
The new laws, the statement further notes, are intended to “improve the soundness, integrity and stability of the system of money transfer and confidence in the financial sector”.
“They will enable the traceability of transfer of funds which will be an important tool in the prevention, investigation and detection of money-laundering or terrorist financing.”
Stakeholders which include the banking sector, insurance companies, private sector and non-banking institutions were consulted during the drafting of the regulations, the CBL further noted in the press release.

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