By Samuel Ouma |@journalist_27
Martin Machere Karuri and Reuben Tum are alleged to have committed the electronic banking fraud between June last year and January 20, 2019 at SBM and Family banks. The duo were charged with four counts that is stealing, electronic fraud, handling stolen property and conspiracy to steal.
The court was told that Martin Machere together with others who were not present before Chief Magistrate Francis Andayi between January 1 and January 20, 2019, altered data in the SBM bank’s core banking system by interfering with 22 prepaid balances of customers thereby causing a loss of Ksh.294 million (USD$2,940,000).
He was also accused of stealing Ksh.5 million (USD$50,000) from Family bank on January 19 at unidentified place within the country and withdrew Ksh.807, 684 (USD$8,070) the same night.
On the other hand, Tum was accused of fraudulently altering data in a SBM Kenya, formerly known as Chase Bank, by interfering with 43 clients’ account balances which led to a loss of Ksh.12 million (USD$120,000).
He was also charged of stealing Ksh.156, 000 from the SBM Kenya on July8, 2018 at anonymous place within the country. He also withdrew Ksh.105,000 (USD$1,050) through ATM and M-Pesa (Mobile phone-based money transfer, financing and micro-financing services) the same date.
He was also charged with conspiracy to steal Ksh.12 million (USD$120,000) the lender on diverse dates between June 1, 2018 and July 8, 2018.
This arraignment came one day after the Directorate of Criminal Investigations (DCI) published names and images of 130 suspects wanted in connection with electronic fraud by hacking banking system.
The DCI boss George Kinoti published the photographs of the suspects alongside their names and identity card numbers, calling on the public to report their whereabouts to police.
Financial institutions in Kenya have recently become a soft target for cyber criminals, losing millions of shillings. A recent study by Myriad Connect on Kenya financial transaction fraud linked the increase in financial fraud to rapid adoption of technology in the country’s financial markets.
“While financial service transaction fraud is a global issue, Kenya has been a leader in adoption of mobile and digital payments, which unfortunately brings with it a growing risk of fraud. Such fraud in Kenya is costing banks millions of dollars and customers their life savings,” said Fabien Delanaud, Myriad Connect General Manager.
In January 2018, National Bank of Kenya was hardly hit by hackers in which Ksh.29 million (USD$290,000) was lost.
Machere was released on Ksh.1 million (USD$10,000) cash bail or a bond of a similar amount while Tum was released on Ksh.500,000 (USD$50,000) bond and a cash bail of Ksh.300,000 (USD$3,000).