Why Kenyans should be wary of fake currency -Bankers Association

The Kenya Bankers Association (KBA) has cautioned the public to be vigilant during the transition of the currencies from the old generation to the old generation.

In a statement asking the public not wait until the 1st of October 2019 deadline, the banking sector umbrella body says Banks have anticipated this exercise and are ready to start the issuance of the new currency.

Patrick Njoroge displays some of the new designs for the Kenyan currency notes

“We also encourage banks, bank agents and retailers, as well as citizens in general, to be especially vigilant during this period as there may be attempts to launder illicit funds through the banking system during the exercise of replacing the old generation notes with the newly released ones, ” reads part of the statement.

Kenyans must return their 1,000 shillings ($10; £8) notes to banks by 1 October, in a bid to fight money laundering, counterfeits, and corruption.

New banknotes are to be brought in over the coming months with other denominations being phased out gradually.

Some Kenyans have expressed anger over the new banknote design, which features an image of a statue of Kenya’s first President, Jomo Kenyatta – the current president’s father.

The decision on the design, as well as the clampdown on the 1,000 shilling notes, has been challenged in court.

According to the association, banks also began the process of modifying their ATM machines and currency counters while coordinating with the Central Bank to ensure minimal disruption of regular services. A huge amount of cash is expected to be deposited in banks and multiple inter-bank transactions could ensue during the period.

Fake foreign cash

Data from the lobby group shows that there are approximately 1,700 ATM machines; 780 branches; and 66 thousand bank agents across Kenya.

The large sums of fake foreign currency seized by the police in recent months have raised concerns on whether Nairobi could be turning into a base for transnational fake cash cartels.

The February 27 discovery of a cache of largely fake foreign cash amounting to Sh32 billion in a residential house in Ruiru town, 26km north-east of Nairobi, followed a series of similar cases in the past few years.

In June 2018, the High Court in Nairobi condemned a Niger and Cameroonian nationals to 10 years in jail for possession of an estimated Sh110 billion in counterfeit currency.

Counterfeit banknotes remain a top form of fraud for the increasingly growing mobile money and bank agents in Kenya.

A survey by the CBK in June 2017 suggested 97 percent of the fraud faced by mobile cash agents involved fake notes, especially the Sh1,000 and Sh500 notes.

The survey, based on 2015 data, showed that mobile agents, largely dealing in Safaricom’s M-Pesa, have become a key target for fake cash printing syndicates with 24,562 cases reported in that year.

 

 

 

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