Circular on establishing specialized fraud management departments in banks

Cairo on: 2 April 2026
Mr. Professor / Chairman of the Board
Bank
Greetings,
In the framework of the Central Bank's keenness to maintain the stability and safety of banks under its supervision, and due to the threat that fraud risks pose to the stability of the banking sector, especially in light of rapid technological developments and increased reliance on electronic transactions and digital financial services. And in an endeavor to strengthen the Central Bank's supervisory role and support banks' ability to confront various types of fraud and limit related risks, the Central Bank's Board of Directors, at its meeting held on March 31, 2026, approved the following:
All banks operating in the Arab Republic of Egypt are required to establish a specialized department for fraud management and combat, directly reporting to the Head of the Risk Sector, and submitting its work through the Risk Sector to the Risk Committee of the Board of Directors periodically, provided that the responsibility of the fraud combat department generally includes setting fraud combat policies and controls, technical examination work for internal and external fraud, monitoring all fraudulent practices on all banking or digital products, ensuring the integrity of retail banking documents, large, medium, small, and micro-enterprises, in addition to examining counterfeit compulsory currencies. The general framework for the work of this department is as follows, at a minimum:

1. Preparing a fraud combat strategy and policy for the bank and obtaining its approval from the Board of Directors.
2. Conducting an objective and independent assessment of fraud risks related to various bank operating procedures, and ensuring the effectiveness of controls by studying the policies and procedures applied for fraud risk assessment.
3. Establishing a mechanism for continuous monitoring and follow-up from a fraud combat perspective on banking operations of all types and products at all stages that include these banking operations, in line with laws and instructions.
4. Combating various fraudulent practices on digital payment systems by monitoring the movements of customers and contracted merchants on these systems, which include, for example: continuous monitoring of transactions (bank cards of all types - various payment acceptance systems such as point-of-sale and electronic wallets and e-commerce - digital services .... etc.).
5. Receiving reports of internal and external fraud cases and conducting technical examinations, whether for cases reported to that department or discovered during various operations, in cooperation with the relevant sectors.
6. Performing technical examination work for internal fraud cases, provided that the remaining relevant sectors handle their affairs afterward in light of the results of the technical examination.
7. Examining counterfeit compulsory currencies (banknotes).
8. Preparing separate reports for each fraud case and establishing a database of detected fraud cases within the bank, along with corrective plans to ensure that fraud operations are not repeated.
9. Ensuring the existence of procedures indicating the continuous commitment of external parties contracted with the bank to the bank's fraud combat policies and procedures, including them in the contracts concluded with those parties.
10. Establishing internal warning lists that include those involved in fraudulent acts, whether customers, companies, suppliers, employees, and others, according to a sufficient oversight mechanism that ensures the adequacy, integrity, and neutrality of listing operations on that list, and establishing a mechanism for checking warning lists before conducting banking transactions or operational or administrative work.
11. Creating a general framework that ensures coordination between the fraud combat department and other bank departments such as Internal Audit, Internal Control, Compliance, Customer Rights Protection, Information Security, Legal, Human Resources... etc.
12. Working on holding awareness programs about various fraudulent practices for all bank employees (whether appointed or outsourced service providers), in addition to special programs for customers.
13. The bank shall fulfill all necessary procedures to obtain prior approval from the Central Bank before appointing a new fraud combat official, in accordance with the merit and technical competence conditions for key officials in banks, and for current managers responsible for fraud combat, their data shall be provided to the Central Bank in preparation for their registration in the Central Bank's records.
14. Commitment to report fraud cases to the Central Bank of Egypt through the reporting system of the Central Department for Combating Fraud and Financial Crimes or any newly developed means.
    Banks are granted a six-month period to reconcile their status in compliance with these instructions.
    Please accept our highest regards,
    Tarek El-Khouly