National Bank of Ethiopia Freezes 391 Bank Accounts over Illegal Money Transfer Activities

Addis Ababa October 7/2022 /ENA/The National Bank of Ethiopia announced that it has frozen the bank accounts of 391 individuals, who are engaged in illegal foreign currency transfer activities.

In his press briefing today, Governor of NBE, Yinager Desie said that though Ethiopia has been registering encouraging achievements following the ongoing economic reforms, there are still limitations in terms of curbing inflation and boosting productivity.

In this regard, the illegal transaction and exchange of foreign currencies has been contributing to the existing inflation and the trading system, he said noting that administrative actions are being taken against entities engaged in illegal foreign currency transfer activities.

As part of these measures, the accounts of 391 individuals have been frozen and legal processes are commenced to file charges against the individuals, he added.

“There are people doing illegal work. It is necessary to take administrative and legal measures against these people. People involved in illegal foreign exchange, especially illegal money transfer, are part of it.”

The governor indicated that foreign currency exchange rate gap is widening due to those who have been engaged in illegal money transfer in Ethiopia.

In recent times, the gap between Ethiopian currency’s official and parallel exchange rates have shown a wider difference, with the  dollar being  highly traded in the black market.

Noting that there are people who are engaged in money transfer business using foreign currencies with legal permission, Yinager said these licensed money transmitters are still encouraged by the government.

Ethiopia earns billions of foreign currency every year through these legal money transmitters operating in the country, the Governor added.

“However, when they are expected to work with financial institutions by obtaining permission; they are working outside of the banks, where there are illegal money transfer (Hawala) businesses. As a result, recently, the exchange rate of the dollar in black market has been increasing,” according to the Governor.

Yinager also stressed strict action will be taken against those who are engaged in the black market.

Moreover, the bank officials and employees in various banks mentioned that there are parties involved in this illegal activity, the governor hinted. Administrative and legal actions will be taken against these parties too, he underscored.

On the other hand, an attractive reward system has been set up for citizens who report and give information about  this illegal act as well as actors involved, he noted.

In particular, the governor underlined there will be money rewards to citizens who inform about the printing and distributing of fake currency notes, as well as transferring of illegal foreign currency and involvement in black market activities.