Thursday , September 20 2018

End practice of converting loans to cash, banks urged

KUWAIT CITY, July 16: Advertisements on converting loans to cash and assisting in banking transactions have been sweeping through social media lately, targeting citizens and expatriates who desire to obtain loans or reschedule debts. A reliable source said some managers of specific bank branches deal secretly with usurers to accomplish new transactions and to boost the sale of credit cards and loans.

Al-Seyassah daily interviewed a number of specialists to figure out the ensuing danger of such acts, and former Head of Kuwait Banks Association Mansour Ashour stated some banks are aware of the activities of employees but have declined to take any action against them until the issue is made public.

He pointed out that some banks overlook the issue so as to allow the employee achieve his target set by the bank. He stressed that an individual employee cannot accomplish the process of converting loans into cash without the help of top officials due to commitment of the banks to the sequence of jobs.

He called on the Ministry of Commerce and Industry to take relevant action to put an end to the widespread negative phenomenon. He added such acts encourage citizens to misuse public funds by inviting them to cash in on funds allotted for the national personnel employed in private sector by facilitating the approval of loans. He added some deceive clients to get their lifted names from black lists, including insolvent debtors facing legal action.

Converting
Economic expert Thamer Al- Naqib also stated the tsunami of converting loans into cash is sweeping through all local banks due to lack of monitoring of the employees having become mediators to receive commissions, regardless of the consequent losses.

He said the issue is too complicated. On one side, the client tries to get his problem solved by converting his loans into cash, and on the other hand, the bank tries to keep the loan system working to keep away from the circle of bad debts resulting from the withdrawals. Banking expert Musa Darweesh is of the view that some processes of converting loans into cash constitute money laundering, which is punishable according to Kuwaiti laws. He added the banks’ policy on providing loans is conventional due to the fear of new crises.

Also, chairman of the Board of Directors of Al-Arabi Shareholding Group Hamed Al- Bassam pointed to the danger of converting loans into cash through advertisements pulled off by some bank employees in cooperation of usurers. He stated the importance of reviewing the appointment of new employees to ensure they have good reputation and relevant qualifications.

 

By Rabab Al-Jawhari Al-Seyassah Staff

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