MBABANE – The deliberate use of minors’ identities and bank accounts to facilitate fraud, tax evasion and money laundering has emerged as a major financial crime risk in Eswatini, with serious national and international implications.
According to the Eswatini Financial Intelligence Centre’s (EFIC) Money Laundering and Terrorism Financing Typology Report for 2022–2024, criminals are increasingly exploiting children’s bank accounts to conceal the true ownership of illicit proceeds and evade regulatory and tax scrutiny.
A typology report is a document that explains the common methods, patterns and techniques used to commit certain types of crimes.
One of the most striking cases analysed by the financial centre involved a personal bank account opened in the name of a minor which received more than E6 million over a period of approximately 50 months.
Although the declared source of funds was an allowance, EFIC’s financial intelligence analysis revealed repeated cash deposits and outgoing payments clearly linked to commercial activity.
“The volume, frequency and value of the transactions were inconsistent with the minor’s age and declared source of income,” the report states.
Outgoing transactions were reported to have carried descriptions indicative of business dealings, leaving little doubt that the account was being used to conceal the true ownership and source of business income.
EFIC observed that such arrangements are typically orchestrated by parents or guardians who deposit business proceeds into children’s accounts to obscure beneficial ownership and reduce declared taxable income.
By placing illicit funds in accounts perceived as low-risk, criminals attempt to delay detection, exploit gaps in monitoring systems and frustrate investigative efforts.
The centre says beyond the financial system, the practice raises profound child protection concerns.
The report identifies the use of third parties and nominees – including minors and close relatives – as one of the most recurring patterns in suspicious transaction reports (STRs) submitted between 2022 and 2024.
This tactic allows criminals to distance themselves from illicit proceeds while maintaining effective control over the funds.
Compiled in terms of the Money Laundering and Financing of Terrorism Prevention Act of 2011 (as amended), the report draws from STRs, operational intelligence and information from law enforcement agencies.
It demonstrates how criminals place illicit funds into the financial system, layer them through multiple transactions and, in some cases, move them across borders.
EFIC warns that the misuse of minors’ accounts undermines Know Your Customer (KYC) and customer due diligence frameworks and highlights vulnerabilities that could be exploited by organised and transnational criminal networks.
The financial centre recommends enhanced scrutiny of accounts held in the names of minors, particularly where transaction activity is inconsistent with declared profiles or linked to known business operators.
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EFIC’s first-ever typology report
MBABANE – In a landmark move for the kingdom’s financial security, the Eswatini Financial Intelligence Centre (EFIC) has released its first-ever Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) Typology Report.
A typology report is a document that explains the common methods, patterns and techniques used to commit certain types of crimes. EFIC, whose Director General is Babhekile Matsebula, in a media brief, stated that this report marked a historic shift in how the nation identifies and combats illicit financial flows.
This inaugural publication is said to serve as a sophisticated strategic analysis tool, specifically designed to help the financial sector and law enforcement agencies get ahead of emerging threats that undermine the national economy.
According to the media briefing, the release of this report is a direct response to international oversight, effectively addressing a critical gap identified in the last Mutual Evaluation Report (MER), which had previously noted that Eswatini lacked the strategic analysis necessary to help investigators pursue complex money laundering and terrorist financing cases.
By launching this first edition, the EFIC has now established a formal baseline for tracking the evolution of criminal patterns within the country’s borders. The data captured in this maiden report reveals a concerning trend between 2022 and 2024, showing a significant spike in illicit activity moving through the financial system.
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