Banks lose millions to rogue staff

Customers at a banking hall. Out of Sh85 million stolen from different banks in August, police suspect Sh30 million ended up with rogue workers. Photo/FILE 

In Summary

• Electronic fund transfers and blank cheque leaves, among methods used to steal by employees
• The police report further shows that a big number of identities of people who steal from banks is never known.

By FRED MUKINDA
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Bank employees are getting away with the bulk of millions of shillings stolen from the financial institutions every month, according to police investigations.

Out of Sh85 million stolen from different banks in August, police suspect Sh30 million ended up with rogue workers and have zeroed in on 10 employees for investigations.

The suspects are staff of K-Rep and Eco banks.

Unscrupulous employees used electronic fund transfers and outright embezzlement to get away with the money, according to a police report seen by the Nation.

Other bank workers have since been charged in court in cases that involve even bigger amounts of money.

Ms Selina Betty Pamba, Mr Mike Oundo, Mr Collins Omuga and Mr James Mwangi have been charged with embezzling more than Sh328 million from Standard Chartered Bank.

The matter is still in court and is scheduled for hearing on November 7.

Another case involves the loss of Sh2.7 million through electronic funds transfer from Cooperative Bank, in which Mr Evans Matara, Mr Fredrick Matemo and Mr Paul Nyamari are expected to appear in court on December 4.

Mr Harrison Murugu also faces theft of Sh1.3 million from CFC Stanbic bank with the case scheduled for a hearing on October 25.

The police report further shows that a big number of identities of people who steal from banks is never known.

In 36 cases reported in August that are under investigation, suspects in 15 of them are listed as “unknown.”

Since January, police have received 400 reports of theft from banks and other financial institutions.

In cases pending in court and those under investigation since the year began, Sh1.2 billion was reported stolen out of which only Sh337 million was recovered.

Other methods used to steal from banks include, blank cheque leaves, which were stolen, forged and cashed, as well as the use of counterfeit credit cards.

The revelations come in the wake of increased cases of cyber crime, where fraudsters use computer technology to steal colossal amounts of money.

Police believe the amounts reported reflect a small portion of real losses since banks sometimes prefer internal disciplinary measures in cases involving thieving employees.

OTHER FRAUD VICTIMS

The police report also shows that other firms have also fallen prey to the fraudsters, including the Kenya National Examinations Council which lost over Sh350,000 through electronic fund transfers.

NAT Fire Company is also among the firms that have lost money.

The crimes are usually investigated by the Banking Fraud Investigations Unit which reports to the Inspector General of Police David Kimaiyo and the Central Bank of Kenya Governor, Prof Njuguna Ndung’u.