Money dealer robbed Sh15 million in demonetisation rush

A man has claimed he was robbed of Sh15 million as he tried to help a politician who wanted to change old Sh1,000 banknotes to US dollars.

The money dealer reported to Capitol Hill Police Station, Nairobi, that a man known to him informed him a politician had Sh15 million in the old currency and wanted it changed to US dollars at “a good rate”.

The victim runs a forex exchange bureau in Eastleigh. He told police he then packed 150,000 US dollars and took a car that the said broker had arrived in.

On reaching Upperhill area, the broker threatened the money dealer and took away the cash.

Nairobi Police boss Philip Ndolo said his team is investigating the Saturday night claims.

This comes as the Director of Public Prosecutions Noordin Haji directed the Ethics and Anti-Corruption Commission and police to take measures to preserve the monetary value of old Sh1,000 notes held as exhibits in court.

He directed that the agencies have all pending cases where the old Sh1,000 bank notes are being held as exhibits be mentioned in their respective courts to enable the courts to make appropriate orders to facilitate demonetisation.

 “This move aims to preserve the monetary and evidential value of the exhibits in court. You should file a report on the said cases before September 30, 2019,” said Haji in a memo to the agencies dated September 12.

He also told the police EACC to bring information to all officers under their command.

The two agencies have about Sh50 million held as exhibits.

Those handling the old banknotes are supposed to photocopy the leaves before they hand over to banks for demonetization.

Officers handling the money had been asked to state how much they hold as exhibits to enable Central Bank of Kenya to exchange them with new currencies.

This was after it emerged they are holding the affected old currency in millions of shillings at various stations and courts as exhibits.

Officers holding the cash had raised concern saying the directive to replace the old notes would affect the money they hold.

The Government introduced new currency with plans for withdrawing all old currency from circulation by October 1, 2019.

Uganda and Tanzania stopped the use of the Kenyan currency to shield its banks from being used to launder stolen money back into Kenya.

CBK is conducting the demonetisation. The deadline for the exercise is September 30 and the bank regulator says there will be no extension.

So far, banks have collected more than 100 million pieces of old Sh1,000 notes out of 217 million pieces that were in circulation when the demonetisation was announced.

CBK announced on Madaraka Day it was withdrawing the old notes in a bid to counter counterfeits, corruption and money laundering.

During the demonetisation period, individuals exchanging less than Sh1 million of the old notes and non-account holders were instructed to exchange them through the currency centres, CBK branches and commercial banks.

Bank customers and non-account holders having an excess of Sh5 million are required to get CBK’s approval.

The old generation banknotes will be worthless from October 1, 2019. There have been cases where fraudsters have been making fake notes to gain during the demonetisation period.

To beat the threat, banks and other handlers were asked to be cautious when handling the new notes.