FATF Status

Kenya is on the FATF List of Countries that have been identified as having strategic AML deficiencies

Latest FATF Statement - 21 February 2025

Since February 2024, when Kenya made a high-level political commitment to work with the FATF and ESAAMLG to strengthen the effectiveness of its AML/CFT regime, Kenya has taken steps towards improving its AML/CFT regime, including by completing a TF risk assessment and by bringing its TFS framework related to proliferation financing into compliance. Kenya should continue to work to implement its FATF action plan to address its strategic deficiencies, including by:(1) presenting the results of the NRA and other risk assessments in a consistent manner to competent authorities and the private sector and updating the national AML/CFT strategies; (2) improving risk-based AML/CFT supervision of FIs and DNFBPs and adopting a legal framework for the licensing and supervision of VASPs; (3) enhancing the understanding of preventive measures by FIs and DNFBPs, including to increase STR filing and implement TFS without delay; (4) designating an authority for the regulation of trusts and collection of accurate and up-to-date beneficial ownership information and implementing remedial actions for breaches of compliance with transparency requirements for legal persons and arrangements; (5) improving the use and quality of financial intelligence products; (6) increasing ML and TF investigations and prosecutions in line with risks; (7) bringing the TFS framework in compliance with R.6 and ensure its effective implementation; and (8) revising the framework for NPO regulation and oversight to ensure that mitigating measures are risk-based and do not disrupt or discourage legitimate NPO activity.

Compliance with FATF Recommendations

The latest follow-up Mutual Evaluation relating to the implementation of anti-money laundering and counter-terrorist financing standards in Kenya was undertaken in 2024. According to that Evaluation, Kenya was deemed Compliant for 19 and Largely Compliant for 9 of the FATF 40 Recommendations. It remains Highly Effective for 0 and Substantially Effective for 0 of the Effectiveness ratings.

Kenya continues to struggle with high levels of corruption, as evidenced by its ranking of 126 out of 180 in the 2023 Global Corruption Perception Index, a decline from the previous year. Despite some legal frameworks and agencies like the Ethics and Anti-Corruption Commission (EACC) making efforts to combat corruption, including securing convictions and recovering assets, enforcement remains inconsistent and inadequate. The pervasive corruption affects foreign direct investment and overall economic growth, with a weak judicial system and frequent bribery demands further complicating the business environment.

Kenya's economy showed resilience in 2023, with a GDP growth rate exceeding 5% despite challenges such as high public debt and rising living costs. The government is focused on attracting foreign direct investment through reforms and initiatives like the Bottom-Up Economic Transformation Agenda, which emphasizes sectors such as agriculture, healthcare, and technology. However, bureaucratic hurdles and a high corruption perception continue to pose challenges for U.S. businesses operating in the country.

Kenya offers a positive investment climate, attracting international firms with its focus on foreign direct investment (FDI) and supportive policies under President Ruto's economic development plan. The government has implemented tax and regulatory reforms aimed at enhancing the investment environment, although challenges such as bureaucratic delays and a high corruption perception remain. Additionally, Kenya's strategic location and membership in regional trade blocs provide preferential access to expanding markets, further bolstering its appeal to investors.