Police seized over Rwf72 million and arrested five people in crackdown on black market forex operations over the weekend in the western districts of Rubavu and Rusizi.
The seized money in nine different currencies is part of the continuous countrywide operations against black markets, Police spokesperson for the western region Eulade Gakwaya said.
“One of the suspects was arrested in Rubavu with Rwf50,638,000, $3,637, 2,390,000 (DR) Congolese francs and other amounts in Uganda shillings, pounds, Euros, and Burundian francs,” he said.
“Suspects were conducting forex operations under different covers; some were operating within shops, others renting next to financial institutions to make it look like the forex bureau is owned by that institution,” he added.
The operation follows another last month when a woman was arrested in Huye District en route to Rubavu with over Rwf53 million, which, according to investigations, was also being sold on the black market.
It is alleged that the woman, working with two others in the black market, had transported $45,000 from Rubavu and exchanged it in Kigali, and was at the time of her arrest returning to Rubavu.
Under the law, no person or company is authorised to transact in foreign currencies without authorisation by the central bank.
According to central bank records, there are 91 licensed forex bureaus in the country, 59 of them operating in the City of Kigali. Ten are registered in Rubavu and eight in Rusizi.
For a forex bureau to be licensed, according to the law governing forex bureaus in Rwanda, it should have a paid-up capital of at least Rwf50 million or its equivalent in another currency, including the initial investment costs of at least Rwf10 million.
It should also prove that it has required equipment to carry out the foreign exchange business, including counterfeit detector, CCTV cameras, and an adequate operating system application and sound management information system to process data and generate reports that meet regulatory requirements.
Also required is a full identification record of the proposed management with good reputation and integrity as well as an IT system based management for efficient collection, keeping, processing and reporting of data on all transactions of the forex bureau.
The Penal Code punishes illegal money trade with six months to two years in jail and a fine of Rwf3 million.
“If a forex bureau is not registered, it means that it’s not paying taxes, there is unknown money in circulation which can lead to inflation, and it also exacerbates fraud and money laundering,” Gakwaya said.