Illegal Forex Crackdown: Ethiopia Freezes Bank Accounts of 123 Suspects











Addis Ababa — September 9, 2018 (FMC) — Ethiopian authorities have intensified their fight against black-market currency trading, announcing the immediate freezing of bank accounts belonging to 123 individuals suspected of engaging in illegal foreign exchange activities.

Financial Security Service Action

The Financial Security Service (FSS) stated that it has suspended the financial operations of these suspects and launched legal proceedings to hold them accountable. According to the agency, while the majority of citizens and businesses are using foreign exchange services lawfully within the framework of the country’s macroeconomic reforms, ongoing surveillance has revealed a parallel network of operators exploiting the system for illicit profit.

Evidence of Black-Market Dealings

Preliminary investigations uncovered that certain individuals and groups have been running black-market forex schemes, undermining Ethiopia’s efforts to stabilize its currency. Surveillance data further suggests that some banking professionals may also be complicit, raising serious concerns about internal controls within financial institutions. Authorities indicated that these allegations are under active investigation.

Broader Economic Context

Ethiopia has been undertaking wide-ranging macroeconomic reforms to modernize its financial sector and attract foreign investment. A key element of these reforms is to bring currency markets under transparent regulation. However, the existence of a thriving black market has continued to put pressure on the Ethiopian birr and complicated the government’s efforts to maintain a stable exchange rate.

Next Steps and Legal Measures

The FSS confirmed that it is working in close coordination with key stakeholders—including commercial banks and law-enforcement agencies—to pursue legal action against those involved in currency crimes. The agency reaffirmed its commitment to enforcing Ethiopia’s financial laws and warned that similar operations will continue until illegal foreign exchange activities are eliminated.

Significance for the Financial Sector

This sweeping crackdown highlights the government’s determination to protect the integrity of the banking system and discourage speculative currency trading. Analysts note that such actions send a strong signal to both domestic and international investors that Ethiopia is serious about strengthening financial governance and ensuring that economic reforms are not undermined by illegal practices.

The Financial Security Service concluded its statement by urging the public and banking sector employees to remain vigilant and report any suspicious foreign exchange transactions, underscoring that safeguarding the nation’s financial stability is a collective responsibility.