Regulatory Alerts2016-10-25
Banking Circular No 6 of 2009 - Improvement of Currency operations
The Bank of Uganda has set out specific penalties for various instances where commercial banks violate the provisions related to cash handling and transportation. Here is a summary of the key points: 1. Loss of banknotes or coins in transit - Shs 20,000 per consignment/deposit if less than two pieces are lost; making good the shortage twice the face value of the total number of missing pieces. 2. Shortage in notes or coins deposited at the Bank (maximum tolerance: up to two pieces for each denomination) - No penalty if two pieces or fewer per deposit. If more than two pieces are short, penalties apply according to the table below: 3. Counterfeit notes detected in deposits - Penalties depend on whether they are coins or notes; either 5 times the face value of the counterfeit items or Shs 10,000 per consignment/deposit for coins, and 5 to 100 times the face value of the counterfeit items depending on the denomination for banknotes. 4. Detection of unfit notes in fit notes or mutilated notes - Penalties depend on whether they are coins or notes; Shs 20,000 per consignment/deposit for improperly sorted bundles containing up to 500 items; Shs 100,000 for 501 and more improperly sorted bundles. 5. Mix-up in denomination or mislabeling of packages - Shs 5,000 per deposit. 6. Torn coin bags or unpackaged bundles - Shs 5,000 per deposit. 7. Shortage/excess in number of bundles delivered for deposit - Shs 50,000 per consignment/deposit; penalties will be levied if there are three instances of penalty within a month.