Govt assures FBME Bank depositors of payment

14May 2019
Polycarp Machira
The Guardian
Govt assures FBME Bank depositors of payment

THE government has assured Tanzanians who deposited their money with the defunct FBME Bank that they will soon get their money, though the exact time is yet to be known.

Deputy minister for Finance and Planning, Ashatu KijajII.

Deputy minister for Finance and Planning, Ashatu Kijaji told the House that the government of Tanzania and Cyprus are involved in  talks on how best to solve the matter

She said there are legal challenges on how to collect money and assets that were invested by FBME in other financial institutions, especially outside the country and to be specific, Cyprus  is where the bank had the biggest branch.

"The delay in paying the depositors with the former FBME is due to legal challenges, thus the exact date for the collection and distribution following insolvency is not yet known due to legal battles," she said.

The deputy minister said the government through the Deposit Insurance Board, Bank of Tanzania (BoT) and the office of the Attorney General are holding talks with the government of Cyprus to solve the issue.

The deputy minister was responding to a question by the Special Seats MP,Asha Abdullah Juma (CCM0 who had wanted to know the steps taken by the government to help Tanzanians who made deposits with the bank.

The central bank took over the management of FBME Bank in July 2014 following a report from the U.S. Treasury's Financial Crimes Enforcement Network (FinCEN) describing the bank as a "primary money laundering concern."

The Tanzanian-registered bank mounted a legal challenge against the allegations, but a U.S. court ruled in favour of FinCEN in April 2017, allowing it to shut the bank out of accessing the U.S. financial system.

The decision also paved way for the central bank to revoke the bank's licence, officials said. It said it had appointed the deposit insurance board as the  liquidator.

FBME, which according to its website specialises in cross-border transactions, commercial trading and foreign exchange services, did not respond immediately to a request for comment.

FBME Bank is registered in the East African country but has been conducting most of its business operations elsewhere, notably in Cyprus.

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