A Mandera county official has lost Sh62 million to the State after the High Court ruled that the money held in two accounts at Equity Bank is proceeds of crime and theft at the devolved unit.
Justice Mumbi Ngugi found that Abdi Mohamed Ali, the director of Livestock since February 2013, failed to explain how he made the money deposited between June 2014 and January 2020 when he received Sh9.9 million as salary from the county government.
The deposits were made days apart in tranches ranging from Sh50,000 to Sh5 million in the joint accounts with his wife Saadia Sheikh Osman.
He made withdrawals of Sh10.4 million during that period.
The funds in one of the accounts holding Sh21.4 million were not withdrawn at all, until the Assets Recovery Agency (ARA) obtained orders freezing the accounts last year.
The judge said there was no evidence to show that Mr Ali and his wife were engaged in any business that would generate the kind of funds deposited in the accounts.
Mr Ali had said he was a livestock trader and that he also engaged in beekeeping, but the court found there was nothing to support his claims.
“Having considered the respondents’ pleadings and documents in support of their case, I am constrained to find that they have been unable to place before the court any evidence that shows a legitimate source of the funds in the accounts,” said the judge.
“The only conclusion that can be arrived at is that the funds are proceeds of crime as defined in Pocamla [the Proceeds of Crime and Anti-Money Laundering Act] and are therefore liable to forfeiture to the State.”
The judge added that the forfeiture does not violate any of their constitutional rights because the funds are not protected.
“The respondents have not been able to demonstrate that they have a legitimate source of these funds. Such funds are therefore not protected under the constitutional guarantee in Article 40. The forfeiture does not violate the constitutionally guaranteed protection of property,” the judge said.
The money was frozen last year in two accounts, one holding Sh40 million and another Sh21.4 million.
The ARA went to court saying that the couple had been making suspicious deposits in tranches of below Sh1 million to evade the reporting threshold.
According to the agency, investigations established that there were massive suspicious cash deposits made from different locations, including Garissa, Mandera and Moyale as well as Eastleigh and Westlands in Nairobi. The two accounts are Equity Bank, Mandera branch.
Between July 27, 2018 and February 8, 2020, one of the accounts had received Sh21.4 million and there were no withdrawals.
Mr Ali defended himself saying he was a beekeeper with 200 beehives and had made Sh6.4 million from sale of honey.
But the ARA said there was no evidence of sales or taxes paid to the government from the bee farming, invoices, delivery notes and quantity of honey delivered.
The court also found that there was nothing to support his wife’s claims that she was in the business of selling clothes from Dubai.
An analysis of the accounts showed that there were a total of 77 cash deposits into one of them. Mr Ali also received Sh6 million in three tranches and statements from the bank showed that he made the deposits himself.
The couple argued that the agency had failed to link the funds to any criminal activity or prove that they were proceeds of crime. BY DAILY NATION