Banks urged to blacklist counterfeit manufacturers

Counterfeits, according to a 2017 report from the Standard Bank, make government to lose in the excess of Shs15b taxes annually. FILE PHOTO

What you need to know:

  • Speaking on ‘How financial institutions inadvertently finance illicit trade’, Ms Esther Aikiriza Kagira, the Finance Intelligence Authority manager international relations and strategies analysis, said counterfeiter manufacturing has increasingly grown more sophisticated.

Kampala. Banks must conduct due diligence of customers to minimise the risk of financing rogue businesses, especially those propagating counterfeits.

Speaking during a financial sector dialogue on counterfeits in Kampala, Mr Fred Muwema, the Anti Counterfeit Network director legal and corporate affairs, said banks must not lend to businesses involved in counterfeits, given their impact on the economy.
“There is need to develop an anti-counterfeit policy in the financial sector through increased training and awareness,” he said, noting that a number of counterfeit businesses thrive on loans that they use to edge out legally conducted businesses.

Counterfeits, according to a 2017 report from the Standard Bank, make government to lose in the excess of Shs15b taxes annually.
Mr Muwema said the increased rate of counterfeiting and substandard goods, which Uganda National Bureau of Standard puts at 54 per cent, needs to be fought head-on with government and institutions such as banks blacklisting involved companies.

Mr Paul Kavuma, the Uganda Insurers Association executive director, said that although counterfeits have disrupted a number of sectors, the insurance sector has remained vigilant because it requires that a business must be registered for it to be insured.
This, he said, has helped to weed out companies that encourage the manufacture of counterfeits given that most of them are not registered.

Speaking on ‘How financial institutions inadvertently finance illicit trade’, Ms Esther Aikiriza Kagira, the Finance Intelligence Authority manager international relations and strategies analysis, said counterfeiter manufacturing has increasingly grown more sophisticated.
“Banks are inadvertently used as conduits of funding to promote illicit trade, Africa losses a lot of money in illicit trade. About $50m is lost in illicit trade in Africa per year,” she said.