NAIROBI, Kenya — Nominee for Director General of the Financial Reporting Centre (FRC), Naftaly Rono, has outlined an ambitious reform agenda aimed at combating money laundering and terrorism financing, as Kenya pushes to exit the Financial Action Task Force (FATF) grey list.
Appearing before Parliament during his vetting, Rono said his immediate priority would be accelerating compliance with outstanding FATF action points, strengthening oversight of high-risk sectors, and improving the quality of financial intelligence used by investigators and prosecutors.
Kenya was placed on the FATF grey list in February 2024 after global watchdogs flagged weaknesses in the country’s anti-money laundering and counter-terrorism financing (AML/TF) regime. Grey listing subjects the country to enhanced monitoring and raises transaction costs, reputational risks, and compliance burdens for businesses and investors.
Rono told legislators that his strategy would be anchored on a three-pronged approach, beginning with fast-tracking reforms within his first 100 days in office.
“Within the first 100 days, we will aim to address at least six of the remaining eleven FATF action points required for Kenya’s removal from the grey list,” he said.
He said the FRC would prioritise sectors that remain vulnerable to abuse, particularly designated non-financial businesses and professions (DNFBPs), which include real estate dealers, lawyers, accountants, casinos, and dealers in precious metals.
As part of the reforms, Rono said he would establish a multi-agency technical committee bringing together the FRC, regulators, and private-sector players in sectors that have struggled with AML compliance.
“These sectors are critical in the fight against money laundering, yet they remain among the weakest links. Structured engagement and supervision will be key,” he said.
Rono also underscored the need for internal capacity building at the Financial Reporting Centre, particularly in advanced data analysis, to ensure that suspicious transaction reports translate into actionable intelligence.
“We must improve the use, quality, and timeliness of financial intelligence reports so they can effectively support investigations, prosecutions, and asset recovery,” he said.
If confirmed, Rono said Kenya would undertake a comprehensive terrorism financing risk assessment and present the findings as part of an updated National Risk Assessment, alongside revised national AML/TF strategies.
He further outlined plans to strengthen risk-based supervision of financial institutions and DNFBPs, while pushing for a clear legal framework to license and regulate virtual asset service providers, a sector FATF has repeatedly flagged as high-risk.
Other proposed reforms include enforcing mandatory filing of Suspicious Transaction Reports, implementing targeted financial sanctions without delay, and designating a regulator for trusts to ensure the collection of accurate and up-to-date beneficial ownership information.
Rono said sanctions would be imposed on entities that fail to comply with disclosure and reporting requirements.
The roadmap also includes tightening oversight of non-profit organisations, a sector globally recognised as vulnerable to terrorism financing abuse if poorly regulated.
Kenya’s grey listing has already had tangible economic consequences, with banks and foreign partners subjecting transactions involving Kenya to enhanced due diligence, raising the cost of trade, investment, and remittances.
The National Treasury has previously acknowledged that exiting the grey list is a national priority, requiring coordinated action across government agencies, regulators, law enforcement bodies, and the private sector.
Rono said success would depend on sustained political support and inter-agency cooperation.
“Exiting the grey list is not just about compliance on paper. It is about demonstrating effectiveness in investigations, prosecutions, and prevention,” he said.
