by Caroline Theuri, at 10:56 am, November 08, 2016, Business

Tanzania, Switzerland Sign MOU To Recover Millions Lost in Offshore Accounts

Tanzania has signed a memorandum of understanding (MOU) with the government  of Switzerland to recover illegal money stashed in the European country by Tanzanian citizens. According to the AP, Tanzania’s Foreign Minister, Augustine Mahiga, said the agreement will require cooperation between both countries, including sharing “intelligence on economic crimes.”

According to a 2015 report titled the “Swiss Leaks” project by the Washington-based International Consortium of Investigative Journalists (ICIJ), Tanzanian clients have approximately $114 million hidden in the Swiss banking arm of HSBC.

“The East African country is ranked 100 out of 188 countries with the largest dollar amounts in the leaked Swiss files,” reads the report.

Between 1982 and 2006, there were 91 client accounts opened by Tanzanian nationals, with one client depositing $20.8 million.

According to the governor of the Bank of Tanzania (BoT), Professor Benno Ndulu, added that the agreement will help recover some of the money lost through corruption. BoT also serves as the central bank of Tanzania.

It is not illegal to hold a Swiss bank account, however, such accounts have often been used for illegal activity, such as tax evasion, due to the privacy offered by the Switzerland banking system.

For instance, ICIJ last year observed that global banking giant, HSBC used its Swiss branch to profit from doing business with international criminals.

“These disclosures shine a light on the intersection of international crime and legitimate business, and they dramatically expand what’s known about potentially illegal or unethical behavior in recent years at HSBC, one of the world’s largest banks,” the report reads.

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