Monday, July 4, 2011

High-tech thieves target banks

By FRED MUKINDA, fmukinda@ke.nationmedia.com
Posted  Sunday, July 3 2011 at 22:04

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Banks are losing millions of shillings to fraudsters through technology-based crime, police records show.
In May alone, banks reported to police for investigation 53 cases involving the loss of Sh62 million, but only Sh1.4 million was recovered.
The cash was lost mainly through computer fraud and electronic funds transfers.
At the same time, police took to court 22 other cases reported earlier in which suspects were either acquitted or fined much less amounts compared to the sums stolen.
For instance, a principal magistrate’s court in Nairobi, on May 19, imposed a Sh560,000 fine on Hamisi Rashid alias George Mbugua, who was convicted of stealing Sh2.6 million from Standard Chartered Bank.
Another city court fined Mr Austin Omondi Sh20,000 after finding him guilty of defrauding Cooperative Bank of Kenya of Sh900,000.
The two would face 12 months and nine months in jail respectively in the event they failed to raise the fines.
Many other cases are pending before court.
Credit Bank lost Sh17.4 million in which Mr Patrick Macharia is scheduled to appear in court on July 25.
Last Thursday, Mr Nathan Kivuva was taken to court over the loss of Sh4.9 million reported by the UBA Bank.
Four days earlier, Mr Enock Makokha was brought before court in a case in which Diamond Trust Bank lost Sh1.7 million.
“The frauds detected involved blank cheque leaves, which were stolen, forged and cashed as well as using counterfeit credit cards,” reads part of the police report seen by the Nation.
Forgeries and embezzlement by bank staff was also cited.
Deputy police spokesman Charles Wahong’o told the Nation that although large sums of money were involved, charges preferred against the culprits were minimal, as they did not involve use of force. “The courts decide, but within the law, the extent of punishment,” he said.
Robbery without violence
Mr Wahong’o cited the case of a chicken thief who would be jailed for life for using force when committing crime and another who could not be jailed beyond three years for defrauding a bank of Sh20 million.
But the Sh62 million reported stolen in May is far much lower than the amount in December last year when a massive Sh500 million disappeared from banks and other financial institutions.
Police believe the amounts reported reflect a small portion of real losses since banks sometimes prefer internal disciplinary measures in cases involving thieving employees.

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