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Maputo — Following an on-site inspection, the Bank of Mozambique on Monday fined one of the country’s largest commercial banks, Standard Bank, 290.1 million meticais (about 4.6 million US dollars at current exchange rates) for engaging in fraudulent practices.
The central bank also fined Standard Bank’s Chief Executive Officer, Adimohanma Chukwuma Nwokocha, 6.4 million meticais, and the director of the Corporate and Investment wing of the bank, Carlos Madeira, 14 million meticais.
The Bank of Mozambique suspended Standard Bank, which is based in South Africa, from dealing in foreign currency for a year, Nwokocha and Madeira are banned for holding office in any bank or other financial institution for six years.
A statement from the central bank said that its inspection of Standard Bank had found that it committed “serious breaches of a prudential and exchange rate nature.”
The bank had allegedly “manipulated fraudulently the exchange rate”. It had, among other violations, also set up an illicit payments network, headquartered outside the country, and had undertaken “irregular operations in financial derivatives for covering the risks of exchange rate fluctuations”, which involved Madeira as a client.
According to the statement, the shareholders of Standard Bank are cooperating with the Bank of Mozambique in order to clear up the irregularities, and “safeguard the interests of Standard Bank clients and other interested parties”.
The shareholders must present a credible plan to remedy the irregularities, and the Bank of Mozambique will impose “a resident inspector” on Standard Bank, to ensure that the plan of action is implemented. On this will depend the lifting of the suspension of Standard Bank’s participation in the exchange market.
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