Five banks caught up in suspicious transactions relating to the National Youth Service scandal stand to be penalised, the Central Bank of Kenya (CBK) stated.
The announcement was made on Friday with CBK claiming that the banks presented insufficient responses on why they should not be penalised.
“CBK has reviewed each bank’s response to the penalty assessment and has concluded that the submissions were not sufficient to alter the findings of the investigations and the penalties assessed. Consequently, CBK has levied the penalties as assessed,” a statement to the media from CBK read.
Standard Chartered, Equity Bank, KCB, Co-operative Bank, and Diamond Trust Bank, according to CBK handled the largest flows and violated anti-money laundering regulations in the NYS transactions amounting to Ksh3.5 billion.
“CBK assessed monetary penalties for each of the five banks in accordance with the extent of the violations that were identified and pursuant to CBK’s powers under the Banking Act and the Central Bank of Kenya Act,” part of the statement read.
On September 12, the regulatory body stated that the banks failed to comply with the requirements of Kenya’s Anti-Money Laundering/Combating Financing Terrorism laws and regulations, adding they will be penalised Ksh392.5 million against a transaction value of Ksh3.578 billion.
Co-operative Bank transacted Ksh263 million and will pay Ksh20.0 million while Diamond Trust Bank transacted Ksh162 million and will pay Ksh56.0 million. While Standard Chartered Bank transacted Ksh1.628 billion on its account, it was penalised Ksh77.5 million.
KCB was reported to have transacted Ksh639 million and will pay Ksh149.5 million in penalties. Equity Bank was said to have transacted Ksh886 million and will pay Ksh89.5 million in fines.
Here is the statement by the CBK
