Understanding the Anti Money Laundering Act, 2013: Implications on the Work of Civil Society and Non Governmental Organizations

Abstract

The charitable sector is a vital component of the Ugandan economy and of many national economies and social systems. It complements the activity of the governmental and business sectors in supplying a broad spectrum of public services and improving quality of life, and safeguarding fundamental rights such as freedom of expression and freedom of association. This indeed is the very foundation of the UDHR, the ICESR and the ICCPR, on which the entire charitable sector is based. NPOs can also play an important role in preventing the causes of radical ideology from taking root and are, therefore, potential allies in the fight against terrorism and other societal vices such as bad governance and the suppression of fundamental rights and freedoms. It is important therefore, to safeguard and maintain the practice of charitable giving and the strong and diversified community of institutions through which it operates. In particular, it is important that any regulations and actions in the fight against anti money laundering do not harm the legitimate activities of non-profit organizations. Non-profit organizations can take on a variety of forms, depending on the country and legal system. Within FATF members, law and practice recognizes associations, foundations, fund-raising committees, community service organizations, corporations of public interest, limited companies, and public benevolent institutions, all as legitimate forms of non-profit organizations, just to name a few. This paper discusses how the provisions of the new Anti Money Laundering Act in Uganda may affect the work of NGOs and how they ought to prepare for that impact. Admonishing compliance with the law, the paper cautions NGOs on governance challenges and possible disruptions with fundraising and other aspects of their work.