Bankers association backs Sh8bn NYS II transactions probe

February 8, 2019 11:07 am
“As signatories to the Code of Ethics for Business in Kenya we are committed to working with the Government and other players in the fight against corruption,” it stated/FILE

, NAIROBI, Kenya, Feb 8 – The Kenya Bankers Association (KBA) has expressed its commitment to support investigations into the Sh8 billion National Youth Service (NYS) II probe where five banks and various officials have been implicated.

Through a statement, KBA stated that it will continue to collaborate with the Central Bank of Kenya (CBK) and the Directorate of Criminal Investigations (DCI) to facilitate a secure and robust professional financial services industry.

The organisation called on bank customers and all banking professionals to support the commitment as it seeks to serve the banking public in a secure manner.

“As signatories to the Code of Ethics for Business in Kenya we are committed to working with the Government and other players in the fight against corruption,” it stated.

“We have continued to cooperate with regulators and other authorities in an effort to eradicate all forms of corruption or money laundering that may be perpetrated using the banking system.”

The association pointed out that while investigations of transactions undertaken by the NYS are in progress, it was looking forward to a positive outcome.

“As the umbrella body of the banking industry, KBA will continue to collaborate with the CBK, other industry regulators, and the Directorate of Criminal Investigations on efforts aimed at facilitating a secure, robust and professional financial services industry.”

The statement came even as the Director of Public Prosecutions Noordin Haji formed a team to review the files against five local banks over the scandal.

This follows the recommendation by the Directorate of Criminal Investigations that the institutions and various bank officials be charged with undertaking shady transactions.

Through a statement, Haji stated that there is a team of prosecutors to review the findings of the investigation by the DCI.

He indicated that he will be targeting Kenya Commercial Bank, Standard Chartered Bank, Equity Bank, Diamond Trust Bank and the Cooperative Bank of Kenya.

He will also focus on individuals and entities who concealed, facilitated, aided, abetted and benefitted from the loot.

Standard Charted had the highest amount of looted NYS funds moved, at Sh1.628 billion.

Of that, Sh558.58 million was transacted by bank officials who did not alert the Financial Reporting Centre (FRC) of the huge amounts moved as required by law.

Haji stated that Sh886 million was moved through Equity, out of which transactions amounting to Sh271 million were not reported to the FRC.

Another Sh800 million was moved through KCB. The lender’s officials approved transactions of Sh148 million without following anti-money laundering laws, which require reporting of large transactions to the FRC.

Cooperative Bank allegedly aided the movement of Sh250 million and failed to report transactions of Sh25 million to the FRC.

DTB allegedly failed to report the movement of Sh27 million out of the Sh164 million that passed through its systems.

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