Bankers go for intelligent boxes to curb robberies

Money movers are looking for ways to speed up the introduction of intelligent boxes which render money grabbed in a heist valueless.

They also plan to introduce more cash centres to curb the theft of money on transit, often with some inside help.

The Central Bank of Kenya says it will fast-track the use of intelligent boxes which deface the currency when it leaves its intended route, suffers invasive attack or is subjected to a security violation.

The box releases either a smoke, or ink dye, spoiling the cash and rendering it useless to the criminal.

Any attempt to change stained bank notes will notify the cashier that the money is from the proceeds of a crime.

Two more cash centres in Nakuru and Nyeri would also be set up by the end of the year to supplement those already running in Nairobi, Kisumu, Mombasa and Eldoret.

The Nakuru one will be run by Standard Chattered Bank and the Nyeri centre by the Kenya Commercial Bank on behalf of CBK.

The cash centres reduce long haul cash movement.

The measures have been in the pipeline for a while but fresh urgency has now been caused by two recent robberies targeting G4S CIT vehicles.

The thefts, allegedly by the courier company employees and Administration Police (APs) guarding the vehicles cost the company Sh45 million, money that will now be paid by insurance companies.

While the efficacy of the measures is not in question, the industry is anxious about the costs of effecting the measures, including replacement of money that will be defaced by the dye and stain boxes.

The cost of the intelligent box is estimated at Sh268,000 per unit according to Security Options, a local private security company that plans to supply the boxes locally.

The industry estimates that at present, the chase car and additional driver and at least four AP’s are costing the CIT companies approximately Sh120,000 a month.

The boxes have a shelf life of five years.

Currently, the cost of CIT add-ons like chase cars is transferred directly to the client as administration charges.

Mr Caxton Munyoki, the chairman of the Kenya Security Industry Association, said it was not clear yet if the cost of CIT services would come down with the implementation of the new measures.

“We welcome it together with other technologies that can help reduce theft. But we do not really expect the cost of CIT services to go down, said Mr Munyoki.

Another technology that could be used is known as SmartWater Technology, a product developed in Britain to protect cash in transit couriers and guards.

SmartWater marks are invisible to the naked eye and can forensically link criminals with individual crime scenes.

Insurance costs for cash in transit are expected to be revised downwards because the defacing will render the money useless to the user and there will be no need to compensate the amount lost.

But CBK clarified that all cash in transit will be insured in full for its value.

“As to replacement of defaced banknotes it will  not be done on one to one. Rather CBK will replace through normal demand,” said the banks without explaining.

The association has over the last week held meetings with Internal Security Minister George Saitoti and the currency department of the Central Bank of Kenya.

The meetings resolved to fast-track the implementation of intelligent box, also known as dye and smoke box by reviewing the cash handling regulations that were gazetted in January.

The attorney general’s office is expected to gazette the new rules.

“We have finalised the draft of the new regulations which will shortly be forwarded to the State law office  for review and thereafter be gazetted,” said CBK in a note through its communications office.

The National Environmental Authority (NEMA), the Government chemist and the Kenya Bureau of Standards would be given the mandate to test the dye and smoke chemicals and equipment.

All security companies offering CIT services would use the similar colour of dye and those interested were requested to start applying for licences immediately.

But some security companies which have invested heavily in armoured vehicles in the recent past were said to have opposed the use of the dye and smoke box as it could hit the sales of armoured vehicles.

In Europe for instance, studies done by various vendors of intelligent boxes between 2005 to 2007 show that use of armoured vehicles reduced from 61 per cent to 50 per cent.

Armed police

During the same period soft skinned vehicles (those that are not bullet proof) increased from 38 per cent to 50 per cent in 2007.

“When it comes, there will be no need for banks to use armed police for guarding services,” said John Wanyela, chief executive of the Kenya Bankers Association.

He, however, said a reduction in costs from the use of the device will depend on how much it is retailing in the local market.

Kenya’s financial institutions generally outsource money transport business to security companies, with Security Group, Wells Fargo, G4S and Bob Morgan being the most visible in the segment.

But other analysts warned that these measures will not mean the end of CIT theft because the most recent cases involving G4S vehicles were made possible because the vehicles lacked tracking devices, purportedly pointing to insider-managed robberies.

Trends elsewhere show of robberies could however increase at the point where the intelligent boxes will be emptied.

In London, robbers ambush the intelligent box transported cash at the point where it is to be emptied especially in banks and ATMs and command the guards to open it at gun point taking the money without it being defaced.

Because of this reality, security companies said they will be considering maintaining armed guard at these points.