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The Central Bank of Kenya (CBK) has asked all commercial banks in Kenya in a circular to file weekly reports on persons exchanging old notes in part of strict measures seeking to curb circulation of illicit money.
The circular dated June 10, the CBK said the move is meant to protect lenders from being used as a channel to launder illicit funds.
“Commercial banks shall submit to the CBK periodic weekly reports in the returns attached to the banking circular. These returns should reach the CBK by 9am of first working days of the following week,” reads in part the circular.
“The CBK shall take appropriate enforcement action against any commercial bank which fails, neglects or omits to comply with anti-money laundering laws including submission of returns on time.”
The regulator also wants financial institutions to obtain identifications documents of every person involved in the transaction and establish the source and the purpose of the funds. The CBK had last week suspended currency conversion and repatriation of Kenyan currency. The CBK regulations further state that anyone holding amounts between Sh1m and Sh5m of the withdrawn currency note will need to go to their own banks to complete the transaction.
Those who do not have bank accounts will need to contact the CBK to endorse the exchange.