Two years after the Financial Action Task Force (FATF) placed Kenya under increased monitoring, the country’s approach to exiting the grey list has shifted from legislative patchwork to enforcement.
- •The 2025 AML/CFT Amendment Act builds on updates to beneficial ownership guidelines and new sector-specific reporting obligations.
- •Beyond tightening oversight and improving transparency, the law explicitly targets emerging channels of illicit flows including property transactions, shell companies, and virtual assets.
- •In the past two years, several African countries including South Africa, Nigeria, Mozambique, Burkina Faso, and Tanzania have successfully exited the FATF grey list.
The Virtual Assets Service Providers Act, now in force, establishes licensing requirements, local offices, and regulatory vetting for crypto firms under the Capital Markets Authority (CMA) and the Central Bank of Kenya (CBK).
But grey-listing is not a question of laws; it is a test of whether those laws produce results.
The true locus of enforcement resides at the Financial Reporting Centre (FRC), the country's financial intelligence hub. According to its data, reporting volumes climbed 22% in the 2025 fiscal year to 8,057 submissions including suspicious transaction reports, activity analyses, and whistleblower tips.
Disseminations to law-enforcement agencies rose 21% to 299, producing cases valued at roughly KSh 561 million and forfeitures around KSh 266 million. While modest against the trillions circulating in the Kenyan banking system, these numbers demonstrate that compliance data is being converted into prosecutorial and asset-recovery outcomes.
The African countries that have successfully waded out of the FATF's grey list have strengthened inter-agency coordination between financial intelligence units, law-enforcement agencies, and regulators, while implementing tighter oversight of banks and mobile-money platforms.
FRC's New Director-General
Last week, the National Assembly committee on Finance and National Planning formally approved Naphtaly Kipchirchir Rono as the new Director-General of the FRC. Rono, whose term will run for six years, brings more than 25 years of experience across law, governance, intelligence, and national security.
His background in financial-crime investigations, regulatory enforcement, and inter-agency coordination, augmented by senior roles at the National Intelligence Service (NIS) and the National Police Service Commission was cited as directly relevant to the FRC’s mandate. The vetting confirmed his integrity and compliance record: no criminal charges, tax or loan delinquencies, political-party membership, or prior removals from office.
Naphtaly Rono said that his tenure at the FRC will emphasize strengthening the agency's analytical capacity, operationalizing case-management systems, deepening inter-agency collaboration, and applying technology-led supervision, including AI and blockchain analytics.
Over the past one year, the Centre has expanded supervision of designated non-financial businesses and professions, now covering real estate agencies, casinos, forex bureaus, accountants, SACCOs, payment service providers, and non-profit organizations. This broader perimeter intends to close gaps where illicit flows often hide.
Counter-terrorism financing has emerged as a parallel focus. FRC intelligence now supports arrests, prosecutions, and regional cooperation to disrupt cross-border funding networks. Inter-agency coordination, structured engagement forums, joint investigations, and formal MOUs with the DCI, ODPP, KRA, and regulators aims to position Kenya’s AML architecture less as a compliance formality and more as national security infrastructure.
The Anti-Money Laundering Advisory Board, blending state officials and private-sector representatives, concentrates oversight and accountability at the nexus of intelligence, fiscal policy, and financial supervision.
While there are improvements in the country's commitment to strengthen reporting mechanisms, exiting the grey-list will depend on prosecutorial credibility and the ability to trace, freeze, and confiscate illicit funds reliably.
