Ethiopia is taking significant steps to combat economic crime with the approval of a new legal framework aimed at recovering assets of unknown origin. The Standing Committee on Law and Justice Affairs has endorsed a draft proclamation that seeks to address the serious economic damage caused by illicit financial activities, which have hindered foreign direct investment and negatively impacted the country’s financial systems.
The new legislation focuses on recovering properties that have been acquired through illegal means. Under this proclamation, individuals must demonstrate that their assets or standard of living are proportionate to their legal income, or risk having their property classified as of unknown origin. If a person claims to have acquired assets from abroad, they will be required to provide proper bank receipts to prove that the funds have legally passed through the banking system. Failure to do so will result in those assets being deemed income of unknown origin, subject to confiscation.
The draft decree allows for legal action to recover properties acquired within ten years prior to the proclamation’s enactment. This includes provisions for confiscating assets without a prior conviction, allowing authorities to act against suspected economic criminals more effectively.
Individuals receiving inquiries from prosecutors regarding the source of their assets must respond in writing within one month, providing detailed descriptions and evidence of their properties. This initiative aims to close loopholes that have allowed economic crimes, such as money laundering and tax evasion, to flourish in Ethiopia.
The government hopes that this new legal framework will deter illegal activities and restore integrity to the financial system, ultimately fostering a more favorable environment for foreign direct investment and economic growth. As Ethiopia grapples with rising economic crime rates, these measures represent a critical step towards safeguarding the nation’s economic interests.
