MPs threaten to remove CBK Governor Patrick Njoroge for tough rules

MPs threaten to remove CBK Governor Patrick Njoroge for tough rules

The Members of the 12th Parliament have resolved to go after the Central Bank of Kenya (CBK) boss, Patrick Njoroge, petitioning the governor have been making and enforcing regulations without the consent of the National Assembly as expected.

The legislators were particularly miffed by the rigorous rules that Njoroge introduced to cap the amount of money one can deposit or withdraw in any given day without pulling any special attention from the bank and the regulator.

While debating on the Finance Act they passed in 2018 and which needed CBK to publish regulations governing the banking division within 30 days before any implementation could commence, the MPs alleged Njoroge had been coming up with rules and enforcing them without their nod.

According to the MPs, Njoroge is yet to present or publish a single regulation before the House almost half a year since the Finance Act, 2018, came into force.

They inquired why the rules on daily cash transactions were not brought to Parliament for debate and consent before implementation, arguing the said regulations are hurting the economy by reducing liquidity.

“Rules are not supposed to make it difficult for people to do genuine business. However, he (Patrick Njoroge) has made it more difficult for people to do business by turning banks into documentation bureaus,” Majority Leader Aden Duale protested.
Minority Whip Junet Mahamed added the controversial regulations capping daily withdrawals and deposits were illegal.

The Suna East MP called on the members to block restoration of Njoroge’s term which is set to expire in March 2019.

The Central Bank in January 2016 introduced new rules on how banks should deal with transactions involving more than KS 1 million.

According to the regulations, lenders are expected to know the source and recipient if customer deposits or withdraws over KS 1 million.

Exposeke.com understands the directive was directed at increasing traceability of bank transactions and deterring money laundering and terrorist financing.

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