The Financial Intelligence Authority (FIA) has identified Eastern Uganda’s border entry points as high-risk areas in money laundering and terrorism financing.
FIA Principal Communications Officer, Jossy Muhangi, revealed that the authority has registered cases of terrorism financing through the purchase and trade of valuable minerals, particularly in Busia District.
Muhangi explained that minerals such as gold are easier to transport across borders than physical cash, which can easily raise suspicion during movement.
The minerals are later sold to buyers in different locations, with proceeds allegedly used to finance illegal activities.
He said the FIA is working closely with other government agencies to dismantle the criminal networks behind the operations.
However, Muhangi acknowledged the increasing sophistication of the syndicates, noting that they operate through several intermediaries who shield the masterminds from detection. “Investigations are ongoing, and we are registering progressive leads that will eventually help dismantle these criminal rackets,” Muhangi said.
Ruth Namitengo, a local miner in Namayingo District, said gold trading in mining areas is largely controlled by brokers whose identities and final destinations remain unknown to miners. She explained that brokers often camp at mining sites for days or weeks, depending on the quantity of gold required.
Once miners collectively gather about one kilogram of gold, another group of brokers reportedly takes over the transaction chain.
“The situation has remained the same for the past decade that I have been involved in gold mining. We do not know the real buyers or what they use the minerals for,” Namitengo said. She added that a gram of unprocessed gold currently sells for between 8,000 and 12,000 shillings, depending on the broker involved.
Meanwhile, Patrick Mudhungu, a businessman from Mayuge District, expressed concern over weak surveillance along Lake Victoria routes.
Mudhungu, who operates wholesale shops on several islands in the Busoga, said there is little scrutiny on people entering Uganda through the lake borders, conducting small-scale businesses while living lavish lifestyles.
He warned that such loopholes create opportunities for money laundering and terrorism financing to thrive undetected, with some unsuspecting locals unknowingly being used as conduits.
Jinja Resident City Commissioner Salim Komakech also confirmed an increase in cross-border financial crimes, particularly those orchestrated through Lake Victoria routes. Komakech said intelligence teams have been deployed to gather information on the suspects involved.
“The masterminds are sophisticated and difficult to detect, but with coordination among all government agencies involved in combating financial crimes, we believe the suspects will soon be brought to justice,” he said.
In response, the FIA has launched targeted sensitization campaigns to engage the media, opinion leaders, and local government officials and mobilize communities against involvement in money-laundering-related crimes.
According to the officials, many suspects are exploiting mobile money platforms to conduct illicit financial transactions without detection.
They explained that individuals with funds from suspicious or unexplained sources often convince unsuspecting members of the public to transfer the money through their mobile money accounts for a commission.
The funds are later withdrawn and invested in businesses or other ventures without complying with financial regulations, including taxation requirements.
The officials also highlighted the use of the Hawala system, an informal money transfer network commonly linked to terrorism financing.
Under this arrangement, an individual in Uganda can contact a Hawala agent in another location to facilitate cash payments to people involved in illicit activities.
The money is then physically delivered to recipients without passing through formal banking systems. Authorities say this method leaves little or no digital trail, making it difficult for investigators to trace the transactions.
SOURCE: URN
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