Zimbabwe AML Obligations for Accountants: The Money Laundering and Proceeds of Crime Act

Zimbabwe's Money Laundering and Proceeds of Crime Act names the accounting profession as a designated business, sets dollar thresholds for identifying customers, gives a three-working-day deadline for suspicious transaction reports and attaches fines and prison terms to failures. This guide summarises the Act as published on ZimLII, Zimbabwe's legal information institute, and says what we could not read. It sits alongside our guides to Zambia and South Africa.

The law

The Money Laundering and Proceeds of Crime Act [Chapter 9:24] commenced on 28 June 2013. The ZimLII page shows a version dated 21 February 2020, consolidated by the Law Development Commission of Zimbabwe, with amendments made in 2018, by the 2019 Finance Act and by an Amendment Act of 2019. We read that consolidated version up to section 34. We did not read the individual amending Acts or any later changes.

Are accountants covered?

Yes. Section 13 lists designated non-financial businesses and professions, and accountants and auditors fall under paragraph (f), a "legal, accounting, corporate service or estate administration professional", covering those registered under the Public Accountants and Auditors Act and the Chartered Accountants Act. The list also includes gaming operators, estate agents, dealers in precious stones and metals, trust and company service providers and motor vehicle dealers.

Customer due diligence

Under section 15, a covered business must identify and verify customers when opening an account, for occasional transactions of US$5,000 or more, for wire transfers of US$1,000 or more, where it has doubts about earlier information, and where it suspects money laundering or terrorist financing. Sector thresholds are set separately: US$3,000 for gaming operators and US$15,000 for cash receipts by dealers in precious stones and metals. The Act also requires the beneficial owner to be identified and verified, and defines a beneficial owner as a natural person who ultimately owns or controls property, or exercises ultimate effective control over a legal person or arrangement, with an ownership threshold of 25 per cent or more of shares or voting rights or otherwise exercising control over management.

Verification generally has to take place before the relationship is established, with a limited exception for unavoidable delay (section 16). Section 18 allows reliance on third parties but the institution stays responsible, section 19 covers customers who are not physically present, and under section 22 a business that cannot complete due diligence must not open or maintain the account and must report to the Financial Intelligence Unit. See our general guide to ultimate beneficial ownership.

Politically exposed persons and higher-risk countries

Section 20 covers politically exposed persons, including domestic and foreign prominent officials, senior members of international organisations and their close associates and family members. It requires senior management approval and identification of the source of wealth and funds. Under section 26, a business must keep customer and beneficial owner information current, examine transactions for consistency with the customer's profile, give special attention to complex or unusual large transactions and to persons from insufficiently compliant jurisdictions, and record its findings in writing. Section 26A requires enhanced due diligence and countermeasures for countries flagged by the FATF or the FIU.

Record keeping

Section 24(2) sets a minimum of five years for customer identification records and account files after the business relationship ends, five years from the transaction for transaction records, and five years from the report date for copies of suspicious transaction reports.

Reporting suspicions and tipping off

Section 30 requires designated businesses and their directors, officers and employees to report suspicions to the Unit "promptly, but not later than three working days after forming the suspicion". Legal and accounting professionals report only for specified client transactions (section 30(2)), and legal practitioners are excluded for information obtained in legal advice or representation. Section 31 prohibits telling customers or third parties that a report or investigation exists, with exceptions that include accountants and legal practitioners dissuading a client from illegal activity. Reporter identity is protected (section 32) and good-faith reports carry immunity from proceedings for breach of secrecy or contract (section 33).

Penalties

The Act's penalties are stated in US dollars. As we read them:

• Section 34: intentional or grossly negligent failure to report, false or misleading statements, or tipping off carries a fine of up to US$100,000, imprisonment of up to three years, or both.
• Section 28: intentional or grossly negligent record-keeping failures, and failures of ongoing monitoring and wire transfer duties, carry the same level of penalty.
• Section 23: customer identification failures carry up to US$100,000 and/or three years.
• Section 8(8): money laundering carries a fine of up to US$500,000 or twice the property value, whichever is greater, and/or up to 25 years. Section 9(4) sets up to 35 years for terrorist financing.
• Section 5(2)(d): civil penalties of up to US$250,000, plus daily amounts.

What we could not confirm

• We did not identify which body is the "competent supervisory authority" for accountants, because section 2(1) is defined by reference and the professional body document we tried to open would not load.
• We did not read sections 35 onward, the amending Acts, any FIU directives or guidelines, or cash reporting thresholds issued by the Unit.
• We did not read sections 25(1) to (3), which set internal control and compliance officer duties, so we do not describe them.
• Some penalties in the Act are expressed as "levels" of fines, which we have not converted to amounts.

Frequently asked questions

How long does an accountant have to report a suspicion?

Section 30 says promptly, but not later than three working days after forming the suspicion.

Do accountants report every suspicion?

Section 30(2) limits reporting by legal, accounting and corporate service professionals to specified client transactions.

Where can I find AML training?

See our CPD courses for accountants and finance professionals.