CBK sets new rules for cash withdrawal of Sh1m or more
Central Bank of Kenya Governor Patrick Njoroge during a press conference at the CBK on the Monetary Policy Committee decisions as at January 21, 2016. The CBK has issued new rules to govern cash withdrawal of Sh1 million or more in response to the massive fraud at the NYS. PHOTO | DIANA NGILA | NATION MEDIA GROUP
What you need to know:
- Anyone wishing to withdraw Sh1m or more will have show source of funds, reason for withdrawal and identity of beneficiaries.
The customer will also be required to reveal what the money will be used for, the direct and indirect beneficiaries and their identities.
Ms Josephine Kabura revealed that huge sums of money were withdrawn in her accounts while she carried out business from NYS.
Tough new rules have been introduced for withdrawing Sh1 million or more in the face of the massive amounts of cash involved in the National Youth Service scandal.
This came as it was revealed that the Central Bank of Kenya (CBK) had fined Family Bank Sh1 million for allowing the withdrawal of huge sums of money over the counter by a business person linked to the fraud.
NEW RULES
In a statement Wednesday, the CBK said anyone wishing to withdraw Sh1 million ($10,000) and above from a bank will be required to fill in a form showing the source of funds, reason for withdrawal and identity of the beneficiaries.
“In compliance with this requirement, all customers making transactions that meet the stipulated amounts will be required to complete a form that captures the source of funds, reason for the transaction rather than electronic means and where the money will be taken after it leaves the bank,” it said in a statement.
The customer will also be required to reveal what the money will be used for, the direct and indirect beneficiaries and their identities.
“This new guideline aims to reduce the risk inherent with cash transactions, such as losses due to fraud and theft. We encourage you to consider use of electronic payments, which are an alternative and secure channel,” it said.
The move comes after Ms Josephine Kabura Irungu revealed in a bare-all affidavit involving former Cabinet Secretary Anne Waiguru that large amounts of cash were withdrawn from her firms’ accounts at Family Bank, KTDA Plaza branch in Nairobi while she carried out business with the NYS.
