Kenya’s Central Bank on Wednesday fined five of its top commercial banks a total of 392.5 million shillings ($3.89 million) for handling more than $35 million, stolen from the country’s National Youth Service (NYS) agency.
The banking regulator in a statement said its investigations led to Standard Chartered Bank Kenya, Equity Bank Kenya, Diamond Trust Bank Kenya, Co-operative Bank of Kenya and KCB Bank Kenya, as the five liable banks.
The banks were found to have violated the anti-money laundering and combating the financing of terrorism laws and regulations by failing to report large cash transactions, failure to undertake adequate customer due diligence, lack of supporting documentation for large transactions, and lapses in reporting of suspicious transaction report to the Financial Reporting Centre (FRC).
The banks were thus penalised based on the extent of violations with the KCB Group levied with the largest fine of Ksh149.5 million ($1.5 million).
Equity was fined Ksh89.5 million ($895,000), StanChart Ksh77.5 million ($775,000), DTB Ksh56 million ($560,000) and Co-op Bank Ksh20 million ($200,000).
The Central Bank of Kenya further said a second phase of the investigations will involve the use of its findings by other investigative agencies with the directorate of criminal investigations and the office of the director of public prosecution assessing criminal culpability.