The bank accounts of 391 individuals, who are engaged in illegal foreign currency transfer activities has been frozen, the National Bank of Ethiopia, NBE reports.
While briefing pressmen, Governor of NBE, Yinager Desie said although Ethiopia has been making headway in economic reforms, there are still limitations in terms of checking inflation and boosting productivity.
Desie linked illegal transactions and exchange of foreign currencies as contributory to existing inflation and the trading system. He said administrative actions are being taken against individuals and engaged involved in illegal foreign currency transactions.
To this end, legal actions have commenced against 391 individuals with their accounts being frozen.
“There are people doing illegal work. It is necessary to take administrative and legal measures against these people. People involved in illegal foreign exchange, especially illegal money transfer, are part of it.”
The governor indicated that foreign currency exchange rate gap is widening due to those who have been engaged in illegal money transfer in Ethiopia.
In recent times, the gap between Ethiopian currency’s official and parallel exchange rates have shown a wider difference, with the dollar being highly traded in the black market.
Ethiopia earns billions of foreign currency every year through legal money transmitters operating in the country, the Governor added.
“However, when they are expected to work with financial institutions by obtaining permission; they are working outside of the banks, where there are illegal money transfer (Hawala) businesses. As a result, recently, the exchange rate of the dollar in black market has been increasing,” according to the Governor.
Desie also stressed that strict action will be taken against those who are engaged in the black market.
Moreover, the bank officials and employees in various banks mentioned that there are parties involved in this illegal activity, the governor hinted. Administrative and legal actions will be taken against these parties too, he emphasised.