ADVOKS GLOBAL · KENYA
The Banking (Penalties) Regulations, 2025
31. Advances issued fraudulently or recklessly
Edition: 2025-07-09 · In force
31. Advances issued fraudulently or recklessly
(1)An institution which, in Kenya—(a)grants an advance or credit facility;(b)gives a financial guarantee; or(c)incurs any other liability,in a fraudulent or reckless manner commits a violation and is liable, upon assessment, to a penalty not exceeding twenty million shillings or three times the gross amount of the monetary gain made or loss avoided, by the institution.(2)An officer of an institution found liable for the violation in paragraph (1), commits a violation and is liable, upon assessment, to a penalty not exceeding one million shillings.(3)In paragraph (1)—"fraudulent" includes intentional deception, false and material representation, concealment or non-disclosure of a material fact or misleading conduct, a device or contrivance, that results in loss and injury to the institution, with an intended gain to the officer of the institution or to a customer of the institution; and"reckless" includes—(a)transacting business beyond the limits set under this Act or the Central Bank Act (Cap. 491);(b)offering facilities contrary to any guidelines or regulations issued by the Central Bank;(c)not observing the institution's policies as approved by the Board of Directors; and(d)misuse of position or facilities of the institution for personal gain.