MPs have threatened to issue sanctions against Central Bank of Kenya (CBK) governor Patrick Njoroge for imposing regulations on the banking sector that have not been ratified by Parliament.
The legislators have also threatened to block his re-appointment over regulations which caps banking transactions at Sh1 million per day.
Njoroge was appointed in June 2015 for a four-year term which can be renewed once.
The regulation that took effect in 2016 requires anyone withdrawing or depositing more than a Sh1 million to fill in a form stating the source of the money or its destination, who they are paying or receiving the money from and for what purpose.
Leader of Majority Aden Duale and Minority Whip Junet Mohammed asked Njoroge to withdraw the regulations or table them in Parliament for approval.
“When I received my mortgage, Barclays Bank told me to explain where the money was coming from. When you sell your three camels you are asked where the money is coming from,” said Duale.
Duale dismissed the argument that the regulations are meant to prevent money laundering as baseless, saying the money laundering law and the Financial Reporting Centre serve that purpose.
In a heated debate in the House, the lawmakers termed the rules as illegal and accused Njoroge of operating with “impunity.
Finance Committee chairperson Joseph Limo said that they had summoned Njoroge to appear before the committee tomorrow.
“We gave CBK a second chance to bring the regulations but he (Njoroge) has failed. They engaged us in a cat-and-mouse game,” said Limo.
But Tongaren MP Eseli Simiyu defended the regulations, saying people must provide details of their source of income.
“In any case, if the money is yours, just say where it is from or where you are taking it. They will not prevent you from taking it,” he said.