*ISLAMABAD – Last week a man walked into a Nairobi car yard and paid for aluxury Mercedes with a mountain of 1,000 shillings ($10/9 euros) banknotes,desperate to offload cash that within days would be worthless*.
With a deadline looming before the Central Bank of Kenya bans all oldedition 1,000 shilling notes, big fish with their fortunes stashed in cashare under pressure to find ways to jettison their money.
A new print of the 1,000 shilling banknote, the largest denomination, wasrolled out in June, with Kenyans given to September 30 to exchange theirold bills at the bank or be stuck with bundles of useless cash.
The operation is aimed at flushing out dirty money being hoarded by taxevaders, crooked businessmen and criminal groups.
Large deposits of the old notes, embossed with the image of Kenya’sfounding father Jomo Kenyatta, raise alarm bells at banks and requirepaperwork to prove their origin.
The central bank in June said there were roughly 218 million 1,000 shillingnotes in circulation, but declined to say what proportion was being stashedas black money.
Kenyan economist Aly-Khan Satchu said devaluing these bills works by“taking its owners by surprise”.
“Four months is a short period of time when you want to launder big sums ofmoney,” he said.
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“People who have that money will definitely try to save what they can”.
*Car wash*
So people are getting creative, devising schemes to quickly unload smallamounts of their cash while avoiding detection by the authorities.
John, a car dealer in Nairobi, recalled his customer last week counting outthousands upon thousands of banknotes to purchase a luxury car worth$74,000 (67,000 euros).
“People want to get rid of their old notes, but they know very well thatquestions will be asked if they go put the money themselves in the bank,”said John, who declined to offer his real name due to the nature of hisbusiness. -APP/AFP
