Addressing factors that lead to money laundering in the real estate sector based on the financial action task force standards: a case study of selected real estate agents in Lusaka district.

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Chisenga, Dennis
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The University of Zambia
Money Laundering is a widespread problem that has negatively impacted many countries in various parts of the world. Zambia is one of the countries in the world that is rated as having a medium high money laundering risk. One of the sectors which have contributed to this rating is the real estate sector which was rated as posing a high money laundering risk in Zambia. Money Laundering has negatively affected Zambia’s financial system and economic development because of a few individuals who earn proceeds from crime and benefit at the expense of many. Further, if left unchecked Money Laundering will allow criminals to expand their operations thereby increasing criminal activities in the society such as drug trafficking, tax evasion and corruption. The study aim was to contribute to the growing body of literature in addressing factors that lead to money laundering in the real estate sector based on the Financial Action Task Force Standards. A descriptive cross-sectional study was conducted and both quantitative and qualitative data was collected to better understand the money laundering in the real estate sector in a bid to address the factors that lead to money laundering. Simple random sampling and purposive sampling were used in this research and a total number of 62 respondents participated in the research. SPSS was used to analyse the quantitative data and the qualitative data was transcribed and analysed based on the recurring themes. The study results are that effective AML in the real estate sector relies on the AML training and effective internal controls by real estate agents. The results presented a p-value of 0.008 which was less than 0.05. This indicated that the model was statistically significant in explaining the impact of the independent variables on the effective AML in real estate sector in Zambia. It is therefore concluded that the independent variables had significant combined effects on effective AML in the real estate sector based on FATF Standards in Zambia. The research results signals that there is need to have more training and awareness activities in the real estate sector.
Thesis of Master of Business Administration in Management Strategy.