Kenya: State to Force Mobile Money Systems Audits

Mergers, Acquisitions and Financial Results

Financial institutions and mobile money providers are set to come under closer scrutiny to make sure they audit their technology systems.

This comes as cases of Cyber crime targeting the financial sector increase putting at risk consumers deposits.

Information PS , Bitange Ndemo, yesterday said the ministry is working with the Central Bank of Kenya to ensure banks and mobile money systems undergo continuous systems audit.

"Most financial systems in Kenya have never been audited, these include mobile money services," Ndemo said during the East Africa Cyber Security Convention in Nairobi.

The systems would have to be audited every year to confirm their integrity.

Cyber fraud is growing fast in Kenya due to access to broadband internet, poor knowledge among consumers and lack of proper mechanisms to fight the vice. The economy is estimated to lose about Sh3 billion to Cyber crime annually. A report released earlier this year by Deloitte, revealed that banks lost about Sh6 Billion to fraudsters between 2011 and 2012.

As Kenyans rely more on technology and new banking platforms are invested, the risk goes higher.

In the first 9 months of this year, Sh1.117 trillion changed hands through mobile phone money transfers which sometimes interface with commercial banks.

"With no clear defined auditing rules for mobile money, and consumers not monitoring their accounts, these criminals could even go on for years before it is discovered," he said.

The sector regulator, Communication Commission of Kenya has created the National Cyber Security Framework, a multi-sectoral body that is working to come up with a defense strategy against cyber crime. It has also set up a National Computer Incident Response Team to handle cyber security issues.

Internal Security PS Mutea Iringo said the Data Protection Act, when implemented, would secure information and data in banks, mobile phones and organizational registries.