In a move meant to curb corruption and illegal transfers of money, the Kenya Bankers Association has put out a circular requiring all bank customers to give a three-day notice in order to make over-the-counter transactions of more than KSh10 million.
The new guidelines are also meant to support Central Bank of Kenya’s circulars on money laundering to help step up efforts to curb graft through the financial sector.
The new rules and guidelines will also require customers to submit supporting documents and information such as source of funds, purpose for withdrawal, ID /Passports of people involved and the reason why a real-time gross settlement cannot be used.
“It was noted that while there are clear guidelines and regulations as defined in the Proceeds of Crime and Anti-Money Laundering Act, 2009 (POCAMLA), the Prudential Guidelines issued by the Central Bank on Kenya on Proceeds of Crime and Money Laundering (Prevention) and Countering the Financing of Terrorism(CBK/PG/08) and the Central Bank of Kenya guidelines on handling of cash above KES 1 million, there was a need to further strengthen controls across all member banks over and above the minimum as stipulated in the above laws,” KBA chief executive Dr Habil Olaka wrote in a circular letter to all member banks and the CBK.
The new KBA guidelines also stipulate that transactions between Kshs. 1 – 10 million will require branch manager approval, Kshs. 10 – 20 million will require regional or senior bank manager approval, while anything above Kshs. 20 million will require the approval of head of brank banking or the director.
The new guidelines will work together with the existing POCAMLA regulations with banks given autonomy in laying even stricter transactions requirements if necessary.