Zimbabwe: RBZ moves on illicit financial flows

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February 5 2016

THE Reserve Bank of Zimbabwe (RBZ) has put in place stringent prudential measures to plug illicit financial flows, as it emerged that close to $2 billion was spirited out of the country last year by individuals and companies, worsening the liquidity situation.

The new measures include, among others, getting rid of the concept of free funds, reporting of suspicious transactions and use of plastic money. A customer who wants to withdraw above $10 000 will now be required, with effect from today, to give the bank reasonable notice of at least a day.

He said $864 million was externalised in 2015 by individuals under the auspices of free funds for various dubious and unwarranted purposes that included remittance of donations to oneself, offshore investments and externalisation of export sales proceeds by corporates through individual accounts leading to pervasive tax evasion and externalisation.

He said $1,2 billion was externalised by companies in the form of export proceeds, high management and expert fees.