Kenya Country Summary

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's corruption perception has worsened, ranking 126 out of 180 countries in the 2023 Transparency International index, attributed to a low number of successful prosecutions of high-profile cases. Despite some convictions and legislative measures aimed at combating corruption, including the Anti-Corruption and Economic Crimes Act and the Bribery Act, enforcement remains inconsistent, and corruption continues to hinder foreign direct investment. Additionally, Kenya faces significant challenges with various forms of organized crime, including human trafficking, arms trafficking, and financial crimes, exacerbated by corruption within government and law enforcement.

Kenya's economy demonstrated resilience in 2023, achieving a GDP growth rate of over 5% despite challenges such as high public debt and inflation. The government is focused on attracting foreign direct investment through various reforms and initiatives, including the Bottom-Up Economic Transformation Agenda, which emphasizes sectors like agriculture and digital infrastructure. However, bureaucratic hurdles and corruption remain significant obstacles for U.S. businesses operating in the country.

Kenya has a favorable investment climate that attracts international firms, bolstered by the Ruto administration's focus on foreign direct investment (FDI) and supportive policies. The government has implemented tax and regulatory reforms to enhance the business environment, although U.S. companies still encounter bureaucratic challenges and delays in obtaining licenses. Despite these hurdles, Kenya's strategic location, strong telecommunications infrastructure, and membership in regional trade blocs further enhance its appeal as a destination for investment.