Senator wants banks probed over fraud

Nominated Senator Tabitha Mutinda has asked the Senate to investigate allegations of fraudulent withdrawal of funds from accounts belonging to customers at some banks.

In her statement to the House, Mutinda (pictured) wants the Senate Finance and Budget committee, of which she is the vice-chair, to invite Central Bank of Kenya and the Chief Executives of various banks to explain how the victims were swindled.

“The committee should explain the measures that have been put in place by the Chief Executive Officers of various banks adversely mentioned in frauds involving customer accounts, the Governor of the Central Bank of Kenya (CBK) and the Head of the Banking Fraud Investigations Department, to stem such activities that cast aspersions on the bank’s security systems,” said Mutinda.

The UDA lawmaker gave the example of Marion Nyambura Karanja who, she said, lost Sh700,000 in her Equity Bank account in Gikomba branch.

Mutinda further sought the committee’s assistance to find out how Matthew Mathia’s pension funds were used to pay for a loan fraudulently taken against his account in the Limuru Branch and many similar cases in the bank’s branches in Uganda.

She went on: “The investigations should also include the telcos. They should be able to share their experience.”

Phone fraud

In a report released last year, Kenyans who reported to have lost money through fraud accounted for 6.1 per cent for mobile bank uses, 25.9 per cent for mobile money users and 6.8 per cent for bank account users.

The Kenya Financial Sector Stability Report also shows that 34.5 per cent and 25.9 per cent of bank account holders attributed the loss of their money to inside job in financial institutions and phone-related fraud respectively.