Banking Circular No 6 of 2009 - Improvement of Currency operations

BANKI
KUU YA
KENYA
CENTRAL
BANK OF
KENYA
Haile Selassie Avenue P. O. Box 60000 - 00200 Nairobi Kenya Telephone: 2860000 Telex: 22324 BANKING CIRCULAR NO. 6 2009

To: All Chief Executives Of Commercial Banks Improvement Of Currency Operations

In light of our continuous efforts to improve currency operations, we wish to notify all banks of the following :- l . Improvement in Handling of Counterfeit Notes In order to curb any circulation of counterfeit currency, all commercial banks are required to confiscate counterfeit currency and immediately stamp the back of the notes as below indicating the given details.

COUNTERFEIT NOTE
Date confiscated .........................
Bank & Branch..........................
Depositor's name.........................
Teller's Name………………………

All confiscated counterfeits should be surrendered to Central Bank of Kenya, promptly.

2. Penalties for Non-compliance with Sorting Guidelines and set timelines.

The following penalties will be levied with effect from 18 October, 2009 for non

No.	NATURE OF SUBVENTION	PENALTY
1.	Late submission of letter of intent to	Kshs 20,000
withdraw/deposit (i.e. after 2pm)
2.	Showing up late to withdraw/deposit cash (	Kshs 20,000
i.e. after 2 p.m.)
3.	Failure to cancel in time intention to	· Where cancellation is received before
deposit/withdraw after submission of letter	4.00p.m .- No penalty.
of intent.	- Cancellation	after	4.00p.m.
	Kshs.20,000	l

compliance with set standards:-

4.	Shortages in coins (maximum tolerance level ten pieces per deposit)
· Coins of all denominations: 5cts to shs.40	.	Ten pieces and below per each deposit -
	make good the shortage only.
	· More than ten pieces per each deposit -
	two times the face value of the total
	number of pieces short in addition to
	making good the shortage.
Shortage in notes (maximum tolerance two pieces per deposit)
5.	.
- Notes of all denominations: Shs. 50 to	Two pieces and below per each deposit
Shs. 1000	- make good the shortage only.
	.	More than two pieces per each deposit -
	two times the face value of the total
	number of pieces short besides making
	good the shortage.
6.	Counterfeit notes detected in deposits (maximum tolerance level - NIL)
· Coins all denominations: 5 cts to shs.40	.	5 times face value besides making good
	the shortage.
· Notes of all denominations; shs.50 to	.	5 times of face value besides making
shs. 1000	good the shortage.
7.	· Detection of unfit notes in fit notes or fit	.	1 to 500 improperly sorted bundles -
notes in unfit notes or mutilated notes	per consignment/deposit.
	shs. 10,000
that do not meet criteria for exchange	· 501 and above improperly sorted bundles
	ksh.20,000 per consignment/deposit.
8.	Shs.5,000 per deposit. This may
· Mix up in denomination	labels	and	.	in
packages	addition lead	to rejection	of	the
	consignment/deposit.
9.	.	Torn coin bags and torn translucent	.	Shs. 5,000 per deposit. This may in
polythene packets or unpackaged bundles	addition,	lead	to rejection	of	the
	consignment/deposit.
10.	· Shortage/excess in number of bundles	.	Shs. 50,000 per consignment/deposit.
delivered for deposit
11.	· Three	instances of penalty	for	any	.	Caution will be issued to the affected
commercial	bank	violating	sorting	bank following which a penalty of not
guidelines in a month	less than kshs.100,000 per month will be
	levied.
The above penalties will be charged to the affected commercial bank's clearing account directly.

myel JAMES P. LOPOYETUM
DIRECTOR
CURRENCY OPERATIONS
& BRANCH ADMINISTRATION DEPARTMENT