Tanzania AML Obligations for Accountants: The Anti-Money Laundering Act, FIU and NBAA Guidelines

In Tanzania the main Act names accountants and auditors outright as "reporting persons", and the national accountancy regulator, the National Board of Accountants and Auditors (NBAA), has issued its own anti-money laundering guidelines for the profession. This guide summarises what the Anti-Money Laundering Act, the Financial Intelligence Unit (FIU) and the NBAA say, using the documents published on the FIU and NBAA websites. It also sets out what we could not read. For neighbouring jurisdictions, see our guides to Uganda and Kenya.

The law: the Anti-Money Laundering Act

The text published on the FIU website is the Anti-Money Laundering Act, Cap. 423, Revised Edition 2023. It was first enacted on 1 July 2007 (GN No. 160 of 2007) and the version we read is amended by Acts up to No. 2 of 2022. Tanzania has other relevant laws, including the Proceeds of Crime Act and the Prevention of Terrorism Act, which we did not read.

Are accountants covered?

Yes. Section 3 defines "reporting persons" and expressly includes accountants and auditors, alongside real estate agents, tax advisers and dealers in precious stones, works of art or metals. Advocates and other legal professionals are covered only when assisting with specified transactions. The Minister may add further categories by notice in the Gazette. The FIU's January 2023 compliance guide for non-financial businesses and professions says it applies in mainland Tanzania and Zanzibar, and covers accountants who prepare for or carry out financial transactions for clients, or assist them, in listed activities such as managing client money.

Customer due diligence

Under section 16, a reporting person must carry out customer due diligence before establishing a business relationship or carrying out an occasional transaction, when money laundering or terrorist financing is suspected, when earlier documents are doubted, and at any time after a material risk is established. It must also monitor the relationship on an ongoing basis, must not keep anonymous or fictitious accounts, and, if due diligence cannot be completed, must terminate the relationship and consider filing a suspicious transaction report. The Act requires reporting persons to obtain and verify information on ultimate beneficial owners. For companies, the definition treats a holding of 5 per cent or more by a natural person as an indicator of direct ownership, and where no owner is identified and there is no suspicion, the senior managing official is treated as the beneficial owner. Reporting persons may rely on due diligence done by another reporting person, subject to regulations.

Politically exposed persons

The Act defines a politically exposed person as someone entrusted with a prominent public function in or outside Tanzania, or in an international organisation, and the definition includes family members and close associates. Section 16 requires risk management systems to identify them, senior management approval, reasonable measures to establish source of wealth and source of funds, and enhanced ongoing monitoring. Our guide to politically exposed persons explains the wider concept.

Record keeping

Section 17 requires records to be kept for a minimum of ten years, running from the completion of the transaction, the end of the business relationship, or the completion of the relevant analysis or risk assessment. Records must be kept longer where a report has been made to the FIU or an investigation is known. The NBAA guidelines repeat the ten-year period.

Suspicious transaction reporting and tipping off

Section 18 requires a reporting person that suspects, or has grounds to suspect, that funds are proceeds of crime or linked to money laundering, terrorist financing or proliferation financing, to report to the FIU "within twenty-four hours after forming that suspicion", and where possible before the transaction proceeds. The FIU Commissioner may suspend a suspicious transaction for up to five working days. The text we read sets penalties for failing to report of a fine of up to five million shillings or up to five years' imprisonment for individuals, and for bodies corporate a fine of up to ten million shillings or three times the property's market value, whichever is greater.

Section 22 prohibits disclosing that a report may be, is being or has been made. For tipping off, the text we read sets a fine of 100 to 500 million shillings or imprisonment of 5 to 10 years for individuals, and fines of 500 million to 1 billion shillings for bodies corporate. Section 13 sets similar penalty ranges for the money laundering offence itself, and section 14 makes directors and officers liable unless they prove lack of consent or connivance and due diligence.

Who supervises accountants

The FIU supervises reporting persons and issues guidelines (section 6), and the Act's list of regulators includes the National Board of Accountants and Auditors. Under section 26, the regulator or FIU enforces compliance, conducts on-site and off-site examinations and imposes administrative sanctions. Section 21 lists those sanctions, including a warning, reprimand, remedial directives, restriction or suspension of activities and licence suspension.

What the FIU and NBAA guidance adds

The FIU's January 2023 guide for non-financial businesses and professions expects an institutional risk assessment proportionate to size and nature, written policies and controls, a compliance officer and deputy at management level, employee screening, ongoing training, and independent testing at least every two years with results sent to the FIU and the regulator. It also requires a copy of the programme and the compliance officer's annual report to go to the FIU and regulator once a year, and the contact details of the money laundering reporting officer to be given to the FIU. Reports are made through the FIU's electronic STR system, with a letter to the Dar es Salaam office as a fallback.

The NBAA's Anti-Money Laundering Guidelines for Accountants and Auditors (revised 2019, first issued in January 2010 with the FIU) apply to all registered accountants, auditors and firms, and say firms carry ultimate responsibility. They require client risk ratings, enhanced due diligence for high-risk clients including politically exposed persons, an STR register, internal reporting to the MLRO who reports to the FIU within 24 hours, cash transaction reports above a threshold set by government, and training. Its red flags include clients who withhold KYC documents or rush the process, complex structures with unclear beneficial ownership, and links to politically exposed persons. Its section references are to an earlier numbering of the Act, so use the Revised Edition numbers above when citing the law.

What we could not confirm

• We did not read the AML Regulations, which set details such as cash declaration thresholds, report content and customer due diligence conditions.
• We did not read the Proceeds of Crime Act or the Prevention of Terrorism Act, or any Zanzibar-specific law.
• The FIU guide's text was cut off before its Annex B (indicators of suspicious transactions), and it did not mention goAML or a registration deadline, so we do not state one.
• Penalty amounts are as shown in the text we read, in Tanzanian shillings, and we did not check whether any amendments after Act No. 2 of 2022 apply.

Frequently asked questions

How quickly must an accountant in Tanzania report a suspicion?

Section 18 of the Act says within twenty-four hours after forming the suspicion, and the NBAA guidelines say the same.

Who supervises accountants?

The FIU supervises reporting persons, and the NBAA is listed among the Act's regulators.

Where can I find AML training?

See our CPD courses for accountants and finance professionals.