The Central Bank of Kenya (CBK) has stopped Absa Bank Kenya PLC from transacting as an authorized foreign exchange dealer in Kenya for seven days.
In a statement released on Thursday CBK said during this time (April 9 to April 15) Absa Kenya will not transact, inter alia,(among other things) in the interbank foreign exchange market.
The CBK has advised the bank to settle transactions committed as of April 8, 2020.
The CBK arrived at the decision after Absa Kenya failed to provide information about some specific foreign exchange trades that it conducted in March 2020.
“In investigating these and other earlier transactions it is evident that Absa Kenya did not have the satisfactory assurance of the underlying commercial transactions supporting these trades, as is required, nor did the bank ensure the standard checks on anti-money laundering and combating the financing of terrorism(AML/CFT) and know-your-customer(KYC) requirements were applied,” CBK said.
The monetary authority has also asked Absa to put in place a framework that ensures all documents related to foreign exchange transactions are available as required.
The bank has also been asked to adhere to the AML/CFT and KYC requirements by Wednesday, April 15, 2020.
“Reverse the market positions that were created as a result of the flagged transactions,” CBK ordered.
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