26th May 2024
Make a Donation

UK probes S.Sudan dealings with banknotes manufacturer

Author: Daniel Danis | Published: Wednesday, July 24, 2019

De La Rue company

The United Kingdom’s Serious Fraud Office is investigating an international company for its alleged corrupt dealings with South Sudan.

De La Rue Company which designed and manufactured the South Sudanese Pounds is suspected of conducting fraud-related businesses with South Sudan.

It is the world’s biggest printer of banknotes and is also the biggest commercial printer of passports.

South Sudan awarded the company a contract to produce 2.8 billion banknotes in 2011, helping put De La Rue back on the path to growth as it unveiled a 13pc rise in operating profits.

This was shortly after the company was hit by staff allegedly falsifying banknote quality certificates and the subsequent suspension of supply to an Indian Reserve Bank.

According to De La Rue, the London-based Serious Fraud Office, SFO, informed it of an impending probe on Tuesday.

The SFO said it was examining how De La Rue, which also produces notes for the Bank of England conducted business in the world’s newest country.

In a statement, the company said all persons associated with the group are being suspected of corruption in the conduct of business in South Sudan

It, however, did not specify the exact allegations labelled against it to warrant such investigations.

“Given the early stage of these matters, it is not possible to predict reliably what effect their outcome may have on De La Rue,” the company said.

But De La Rue has been at the centre of several probes by the Serious Fraud Office, including a 2010 investigation into the falsification of banknote quality certificates by its employees.

In March 2018, the UK government chose not to renew its contract with De La Rue to print British passports.

Shares in the company fell as low as 16 per cent after investigations on its dealings with South Sudan were announced on Tuesday.

South Sudan this year printed new currency notes ranging from 500 pounds, and are already in circulation.

The British security printer also recently won a three-year contract to design and manufacture 11.1 billion Kenya’s new generation currency.

De La Rue said it will cooperate with the SFO in its investigation, and asked employees to come forward with information that may help the probe.

Money Laundering

Last year, international graft monitors said international companies and South Sudan’s neighbours were helping in receiving or processing billions of dollars in stolen funds from South Sudan, fuelling inflation at home and financing civil war.

They said looted money often by top officials leaves South Sudan in dollars, making currency trading one of the most lucrative businesses in the country.

Experts speculate that companies such as De La Rue help print stacks of money that is not eventually injected into the local economy, but diverted directly into the accounts of government officials.

“Some of the money made from manipulation of foreign currency controls is ultimately reinvested in Kenya and Uganda,” a report by Kenya’s Institute of Economic Affairs said in April.

South Sudan is estimated to have lost $6.8 billion in illicit financial flows in the past seven years largely because of regulatory failure, weak state institutions and impunity by high ranking military officers, and constitutional postholders.

The US Department of State money laundering assessment (International Narcotics Control Strategy Report) has put South Sudan on the watch list of dangerous jurisdictions concerning huge illicit financial flows.

De La Rue has a regional office in Kenya and plans to invest more in its factory in Ruaraka, Nairobi as part of a long-term plan to become a Pan-African security printer.

Support Eye Radio, the first independent radio broadcaster of news, information & entertainment in South Sudan.

Make a monthly or a one off contribution.

error: Alert: Content is protected !!