Shock of bank ATMs giving out fake notes

Fake currency has found its way in
banks, raising concern from Kenyans
who now want the matter investigated
and the culprits prosecuted.
A cross-section of people interviewed
by the Nation say some of their money
withdrawn from automated teller
machines had turned out to be fake.
Mr Patrick Gichobe, who runs an M-
Pesa stall on Moi Avenue, Nairobi,
says in September, a customer walked
into his stall to make an M-Pesa
transaction of Sh2,000 only for the
money to turn out to be fake.
“He tabled a bank ATM receipt. I was
hearing this for the first time because
often those with fake money say they
had been sent by other people or they
had been paid after selling an item.
Unfortunately there was nothing I
could do because the money was still
unacceptable,” Mr Gichobe told the
Nation on Friday.
Mr Norbert Wandera has declined
transactions at his electronics shop on
Kimathi Lane three times.
“They (potential clients) claimed they
had either been sent or just
withdrawn from a bank. I suspect it
could be a syndicate which sends
people with fake monies to try and
see if it could be accepted. But my
long experience in handling money
has saved me,” he said.
“The idea that one could withdraw
money from an ATM only to turn out
fake looked surprising. But last week,
a colleague pulled a one-thousand
note from an ATM on Kenyatta
Avenue and when he walked into a
supermarket to buy a drink minutes
later, cashiers rejected the money
arguing it wasn’t genuine. When he
produced a receipt, they argued,
while punching holes in the note, the
excuse was now overused, and told
him to go show it to the bank which
later disowned the note.”
When contacted, head of Banking
Fraud Investigations Unit Joseph
Mugwanja said he was in a place
where he could not comment. He
asked us to contact him on Monday.
Mr Habil Olaka, the chief executive of
the Kenya Bankers Association could
neither respond to our calls nor text
messages.
According to figures in a report
released last Wednesday by audit
firm Deloitte, most of the money
banks lose is a result of collusion
between bank staff and outsiders.
The report, Financial Crimes Survey
Report 2013: Where is the exposure?
shows that cash theft is most
prevalent in Kenya at 72 per cent
compared to cheque, money
laundering or credit card fraud.
“In Kenya where banks lost Sh655.6
million, researchers found that non-
management personnel were more
likely to steal the money or collude
and banks were reluctant to publicise
the incidents.
Most banks in the country hire
security agents to reload ATMs for
them. This is where the collusion
starts as they replace genuine notes
with false ones.
How false money gets to your ATM
(According to the report)
-Abundant liquidity in the banking
industry lures criminals to insert fake
notes in the system
-There is weak financial crimes
control and those whose hands are
found in the cookie jar are given
lenient punishments
-Bank managers and their staff are
casual towards financial crimes and
give little attention to these incidents.
-Internal staff circumvent IT controls
and Banks are pervasive about use of
technology to secure money
-There is lack of platform to share
these incidents of financial crimes
Nation

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