THE Financial Intelligence Centre (FIC) says there is an alarming increase in tax evasion and money laundering activities involving foreign companies in Zambia.
These companies are allegedly engaging in illicit fund transfers and using local proxies to maintain control over their bank accounts.
The latest FIC bulleting highlighted that foreigners have been establishing companies and using Zambians as proxies, a trend that has been particularly evident since the last quarter of 2023.
In the first quarter of 2024, FIC disseminated 810 intelligence reports, a significant rise from the 450 reports in the previous quarter.
The bulletin also noted an estimated outflow of K61 billion in suspected illicit financial flows during the first quarter of 2024.
Investigations have revealed that some of these companies were set up using counterfeit documents, including fake passports for directors, shareholders, and signatories, which were then used to open accounts in multiple banks.
The FIC expressed concern that identity fraud will continue to escalate, and will be exacerbated by advancements in artificial intelligence (AI).
The Centre has urged banks to implement rigorous customer due diligence measures to combat this growing threat.
By Catherine Pule
Kalemba, June 5, 2024
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