Banks are facing an acute shortage of Sh200 and Sh100 notes after politicians and their allies withdrew them for use in voter bribery across the country, a minister has said.
Speaking during the launch of the inaugural Money Laundering and Terrorism Financing National Risk Assessment Report (2021) on Wednesday, Interior Cabinet Secretary Dr Fred Matiang’i claimed that the notes are being hoarded by politicians as they seek to influence voters’ decisions ahead of the August 9 election.
The CS called on Kenyans to elect a team of leaders who are keen on fighting these crimes to cushion the country from deaths and loss of property as experienced during past terror attacks in the country.
“If you put these people into elective positions do you think they will actually firm up the regulatory environment? It is a question we have to ask ourselves,” Dr Matiang’i said.
The CS revealed that during the transition from the old currency to the new one, the government witnessed a phenomenon where car dealers were suddenly exchanging the old notes for the new notes.
“Car dealers changed billions of shillings. How many cars do you need to sell to be able to have billions and all these dealers are friends of senior politicians? They are now the ones financing all these Sh200 and Sh500 notes in the villages and so on,” he said.
He reiterated that this year’s election will be critical in the decisions taken to address the challenge of terror financing and money laundering in the country.
“Either we elect a government that will not fight money laundering because that is its way of life and we will not achieve anything or elect a government that is against money laundering, with integrity and will join all of us in fighting these challenges,” he said.
Previously, Dr Matiang’i had warned that 40 percent of candidates for the next parliament and government are suspects of money laundering commonly referred to as “wash wash”, which has been identified as a major contributor to terror financing.
Money launderers are reportedly capitalising on existing gaps in sloppy banking regulations to influence the electoral process.
Additionally, those arrested are hardly prosecuted in time with their cases taking long in court.
“We have the challenge of multiple bonds issued by our courts. Some of the people who have been arrested are enjoying their eighth, ninth or 10th bond,” said the CS during the National Conference on Criminal Justice Reforms in Naivasha in May.