Investigators have named several Kenyans as suspects in a scheme where Covid-19 mitigation measures were subverted to defraud the United States government of a whopping Sh30 billion between mid-2020 and February this year.
According to details of an investigation seen by the Nation, members of the syndicate, using the illegally obtained funds, then went on a spending binge around the world.
The more than 47 suspects acquired prime beach-front homes in Kenya, US and Turkey, as well as pricey jewellery and high-end apartments in Nairobi and Dubai.
A large part of the loot was also splurged on top-of-the-range vehicles including Porsches, Teslas, Hyundai and the latest brands of Ford.
At the time they were busted, the suspects still had more than Sh14 billion stashed in their bank accounts, held through their own companies, shell outfits, relatives and other proxies.
Prime properties purchased
The spellbinding US investigation has pieced together how part of the Sh30 billion, which is believed to be proceeds of money laundering, fraudulent business operations and bribery, found its way into Kenya, where it was used to purchase prime properties in Nairobi’s South C and South B estates, as well as a beach holiday home in Diani, Kwale County.
According to US prosecutors, the arrests are part of a widened net cast to rid the US Federal Children Nutrition Programs (FCNP) of cons.
Court documents show that the suspects, taking advantage of official Covid-19 mitigation measures, created fake companies and food distribution sites that purportedly served meals to tens of thousands of underprivileged children in the state of Minnesota.
This was after the US government waived some standard requirements for participation in the FCNP, a move that allowed even profit-oriented restaurants to participate in the food distribution to children outside of educational programmes.
The waiver saw hundreds of shell companies spring up under the pretext of supplying and serving meals to children across Minnesota, for which these dubious firms received hundreds of millions of US dollars.
Shell companies
These shell companies were used to register food distribution sites, which would then receive payments from state-approved sponsors.
The investigations reveal how two sponsors, listed as Sponsor A and Feed Our Future, made tens of millions of US dollars by slashing their cuts from the funds wired from the federal government to their accounts.
They then went ahead to distribute the rest of the funds to the companies that owned the food-distribution sites.
Through a cavalcade of fake claims, bribery, kickbacks, falsified invoices and other forms of trickery, the syndicate is said to have made millions of dollars for supplying nothing.
Key suspects in the multibillion-shilling fraud include Abdiaziz Shafii Farah, Mohamed Jama Ismail, Mohamed Ibrahim, Abdimajid Mohamed Nur, Said Shaffi Farah, Abdiwahab Maalim Aftin, Mukhtar Mohammed Shariff, Hayat Mohamed Nur, Liban Yasin Alishire, Ahmed Yasi and Khadar Jigre Adan, who were based in Minnesota.
The suspects are believed to have opened at least 30 FCNP sites using shell companies that included ThinkTech Act or Mind Foundry (Mohamed Ibrahim), The Free Minded Institute, Empire Enterprises LLC (Abdiaziz Farah), MIB Holdings (Mohamed Ibrahim), Nur Consulting (Abdimajib Nur), Buhra Wholesalers (Abdiwahab Aftin), MZ Market LLC (Mohmed Ismail) and Afrique Hospitality Group (Mukhtar Shariff) as well as Empire Cuisine and Market (Abdiaziz Farah).
To cover their tracks, the suspects followed to the letter the protocols required to register food-serving and distribution sites in Minnesota.
After the successful registration of their shell companies, they colluded with the approved sponsors to falsify documents for services that were never rendered.
For their part, the sponsors reportedly okayed fake invoices, thus facilitating payments for the supply of “air” to the less privileged in the US.
Records show that on diverse dates between May 2021 and February this year, properties worth almost $169.9 million were acquired in Nairobi and Diani, by some of the listed suspects.
For instance, on May 4, 2021, Abdiaziz Farah and Abdimajid Nur made a wire transfer of approximately Sh24.28 million from Empire Entreprises to Capital View Properties Ltd, based in Nairobi.
A week later, on May 11, the same individuals wired another Sh36.42 million from Empire Enterprises to the same firm – Capital View Ltd.
Six days later, on May 17, 2021, Abdiwahab Aftin wired Sh24.28 million from Bushra Wholesalers to Capital View Properties in Nairobi to acquire real estate property.
This was barely a day after Sh12 million from Empire Cusine and Market was deposited by Said Farah to Bushra Wholesalers.
Millions wired
On June 1, 2021, Sh24.28 million from Empire Enterprises was wired to Capital View.
On September 22, 2021, Liban Alishire sent Sh6.9 million to Individual B.F at Banque Cantonale de Geneve towards Sh26.22 million from Hoodo Properties to Jaafar Jelle and Company for the purchase of a unit at the Karibu Palms Resort in Diani Beach, on the Kenyan coast.
On January 19, 2022, Sh10.3 million was wired by Liban Alishire from Hoodo Properties to Abdulrahman Saad for the purchase of a five-bedroom apartment in Nairobi.
Abdiaziz Shafii also told a co-conspirator that he had invested more than Sh728.4 million in Kenya over a three-year period.
Another defendant, Mohamed Ismail Jama, informed FBI agents that he owned three properties in Nairobi, where his wife and five children live.
He revealed that in 2018, his wife and children relocated to Nairobi, Kenya. It is at this time that he bought a residence in Nairobi, as well as a stake in an African textile company.
Ismail further stated that he purchased another house in Nairobi around a year ago, using Sh18 million from his textile company and that he also owns a rental property in Nairobi.
Ismail informed FBI officers that his wife divided her time between Kenya and the US, but the agents insisted it was all a lie, as the US Customs and Border Protection records revealed Ismail’s wife had not returned to the US since moving to Kenya.
US authorities arrested Ismail on April 20, 2022, at Minneapolis-St Paul International Airport as he boarded an Amsterdam-bound flight with plans to travel to Nairobi.
According to the charge sheet, Ismail obtained a new passport illegally in March after his previous one was seized by federal investigators in January.
He was charged with one count of passport fraud; for allegedly making false claims in order to obtain a new passport by stating that his original one had been “lost”.
These transactions only show the links to Kenya but do not explain how millions of dollars were spent on other high-end properties across the world.
The trail shows Abdulaziz Farah spent millions of dollars to buy properties in different parts of Minnesota, as well as high-end vehicles. For instance, on April 15, he wired Sh69 million to purchase a single-family home in Savage, Minnesota.
On July 7, 2021, he paid approximately Sh126.2 million for two lake-front lots in Minnesota. He also purchased a 2021 Porshe Macan worth Sh3.5 million on July 31.
On August 21, he bought another GMC Sierra pick-up truck worth Sh9.8 million, paid Sh18.2 million for the construction of a new lake-front house in Prior Lake, Minnesota, and paid another Sh40.6 million on October 12, 2021, for a townhouse in Burnsville, Minnesota.
On June 9, 2021, Mukhtar Shariff purchased a Sh30.3 million cheque from Afrique Hospitality Group to Individual I.M.
On May 27, 2021, Mohamed Ismail paid Sh16.9 million to purchase a townhouse at Edgewood Avenue, Savage, Minnesota.
And on September 1, 2021, Abimajid Nur bought jewellery worth Sh3.6 million from Farhia Jewelry in Dubai.
Records show by the time the law caught up with the members of the syndicate, at least Sh30 billion had been illegally obtained, most of which was spent on luxurious items.
Should the suspects be found guilty of the charges of money laundering, conspiracy to defraud, bribery, corruption and wire fraud conspiracy, they will forfeit all the illegally obtained properties and still serve prison time as provided for by the US constitution. BY DAILY NATION