BoT to review further bureau de change rules

BoT to review further bureau de change rules

BANK of Tanzania (BoT) plans to review further bureau de change regulations to enhance operational efficiency and plug loopholes for illegal foreign currency trading and money laundering.

The Central Bank Manager in the Directorate of Financial Sector Supervision, Mr Nassor Omari, told business reporters at a seminar in Dodoma on Tuesday that the regulations would be reviewed further after it was established there were still some loopholes used by some bureaux for conducting illegal operations.

“The aim is to enhance the regulations to conform to the needs of the time,” he said at the seminar organised by central bank in the capital city.

In June last year, the Central Bank of Tanzania (BoT) revised the minimum capital threshold from 100m/-to 300m/-for Class A and from 250m/- to 1.0bn/- for Class B and increased non-interest bearing deposit at Bank of Tanzania from 50,000 US dollars to 100,000 US dollars.

It suspended new licences for bureaux and required existing forex shops to apply for re-licencing. Mr Omari said tightened control of the bureaux de change would continue to weed out those doing illegal foreign currency trading and money laundering.

He said they did not have plans to restrict foreign exchange business to commercial banks but are determined to clean illegal operations and money laundering activities by some of the foreign exchange bureaux.

“We have no plans to close all bureau de changes. We plan to have strong and serious bureau de changes that do clean business.

They shouldn’t be conduits for money laundering or cleaning drug money,” he said at a training seminar for business reporters organised by the Bank of Tanzania in Dodoma.

The central bank conducted a surprise inspection of foreign exchange bureaus last month in a crackdown on black market currency trading and money laundering.

According to the central bank governor, Prof Florens Luoga  there had been an increase in illegal foreign exchange bureaus and money laundering activities that have been conducted through foreign exchange bureaus.

The central bank suspended issuance of new licenses for foreign exchange bureaus over the past three months to conduct thorough inspections of existing foreign exchange retail bureaus, Luoga said.

“All those found to be operating illegally will have their licences revoked,” said the governor.

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Author: HENRY LYIMO in Dodoma

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