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‘Standard’ exposes banking fraud

BUSIA
By | June 12th 2010

By James Anyanzwa

There has been a sudden rise in crime related to real-time money transfer services, with the latest target being The Standard Group.

The Group detected an attempted fraud on its bank accounts last week.

In a statement yesterday, the Group said an attempt was made to divert funds to third parties but swift action by the management and banking authorities halted the scam.

The matter has been reported to the police and investigations are ongoing. "We wish to reiterate that management is committed to safeguarding the Group’s assets and finances," indicated an internal memo.

According to a report by the consultancy firm PricewaterhouseCoopers (PwC) accounting fraud is the most common economic crime, followed by asset misappropriation fraud and bribery and corruption.

The report dubbed Economic Crimes in Kenya identifies accounting fraud as the most prevalent type of fraud experienced by Kenyan organisations and appears to be more prevalent and rising amongst listed firms.

Recently, the Anti-banking Fraud Department launched investigations in a case in which salaries of 54 teachers amounting to Sh6.7 million were diverted to a personal account.

The fraud allegedly occurred at the Teachers Service Commission (TSC) headquarters in February this year prompting the investigations. A suspect has been interdicted.

Audit report

The PwC showed companies in Kenya experienced the third highest incidence of economic crimes among 54 countries sampled around the world. Russia and South Africa emerged first and second respectively in the survey conducted between July and November last year.

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