CBK fires warning shot to unlicensed Forex traders

The Central Bank of Kenya (CBK) Friday warned Kenyans against online foreign exchange trading through unlicensed entities and unregulated online foreign exchange (forex) dealers and platforms.

The banking regulator said the platforms some of which are downloadable on Google Play and Apple App Store, and aggressively market themselves through social media and mass emails, posed huge financial risks to users.

“They purport to offer the best forex deals in the market, they also collect and or receive funds from customers in exchange for foreign or local currencies. These platforms, do not have the requisite licences issued by CBK or the Capital Markets Authority (CMA),” CBK noted in a statement this morning, further adding that such entities have inadequate anti-money laundering and consumer protection safeguards.

The purpose of this notice, CBK said, is aimed at warning members of the public against dealing with unlicensed and unregulated online forex dealers.

“They should only deal with genuine and licenced financial institutions and entities. Members of the public are therefore advised to confirm the licencing status of forex dealers from the CBK website (www.centralbank.go.ke) and/or CMA website (www.cma.or.ke) before engaging with the dealers, as they risk being defrauded and losing their money to unlicenced and unregulated forex dealers,” the statement read.