The Central Bank of Kenya on Wednesday penalised 5 commercial banks in the East African nation for facilitating the transfer of money looted from the National Youth Service (NYS).
The banks have been fined between 200,000 and 1.5 million for their role in the scandal, Apex Bank Governor, Patrick Njoroge, stated in a press release on Wednesday.
The 5 banks are Kenya Commercial Bank (KCB), Standard Chartered Bank (SCB), Cooperative Bank, Diamond Trust Bank (DTB) and Equity Bank.
“The investigations prioritised the banks that handled largest volumes of cash following serious concerns that came to light in May related to the channelling of the NYS funds,” said Njoroge.
He noted others that handled smaller volumes were still under probe.
According to the apex bank, the 5 institutions committed several violations namely failure to report large cash transactions and failure to undertake adequate customer due diligence.
Others are lack of supporting documentation for big transactions and lapse in reporting suspicious transactions to the financial reporting centre.
Kenya reportedly lost 90 million via the NYS scandal, one of the biggest frauds in a government establishment, and several suspects have been charged in court for the crime.
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