Anti Money Laundering Software Framework for Ethiopian Banks and Financial Agents

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Addis Ababa University


Money Laundering (ML) is the crime of transforming illegally obtained income into seemingly legitimate funds in banks. Anti Money Laundering (AML) is a set of rules or regulations enacted to stop the practice of generating income through Money Laundering and to stop the international and local money launderers. Money Laundering is a major problem in many countries of the world which arises from the difficulty to prevent, detect and prosecute illegal income generation and money transfer. Recent information technologies are making money laundering easier to deposit or withdraw and transfer their funds using financial systems. Hence, controlling ML requires implementation of sophisticated mechanisms. This research sought devising computer based AML mechanism for Ethiopian Banks and Financial Agents by designing a software framework for cash and suspicious data handling, processing, detection avoidance report and remittance monitoring and cash data validation. The Ethiopia Financial Intelligence Center (EFIC) was established by the Ethiopian Prevention and Suppression of Money Laundering and the Financing of Terrorism Proclamation to develop appropriate information management systems to ensure the protection of sensitive and confidential financial information disclosed to supervisory authority. However, there was no computer based AML solutions. Accordingly, this research sought to develop framework with which banks and agents could better control and prevent ML. The result of the framework also supports cash data validation and remittance monitoring for National Bank of Ethiopia (NBE). The framework is tested and validated by using selected data collected from banks and financial agents and by prototype mainly using individual National ID. The prototype developed for that purpose allows the handling of bulky data from various sources and detects suspicious transactions. The framework suggests how to handles, process and report risky financial transactions according to the relevant policy and strategy of the country in ways that help the works of EFIC easier and more effective. Keywords: Money Laundering, Anti Money Laundering, Ethiopian Banks and Financial Agents, National Bank of Ethiopia, Ethiopia Financial Intelligence Center.



Money Laundering, Anti Money Laundering, Ethiopian Banks And Financial Agents, National Bank of Ethiopia, Ethiopia Financial Intelligence Center