Asset recovery in graft war: Explain it or lose it!

 

Over the last couple of years, several people, including entire families have been left destitute after all their assets were ordered forfeited by the High Court for being proceeds of crime (especially corruption-related).

Several more cases are at advanced stages of forfeiture and asset recovery proceedings with very high likelihood of success.

This has brought us into a new era of dealing with corruption where even as criminal cases drag on in the courts, stolen public resources are confiscated and forfeited to the state.

Some of these instances include the High Court ruling for the Ngiritas to forfeit a Toyota Landcruiser and five parcels of land in various areas to the Asset Recovery Agency, being proceeds of crime in NYS II.

In another case, the High Court issued forfeiture orders on April 22 this year against James Thuita Nderitu and others of over Sh32 million held in various bank accounts, being proceeds of crime from NYS.

In yet another such case, in its judgment dated April 15 this year, the High Court found Lillian Mbogo and others held funds in various accounts that were proceeds of crime. It therefore issued orders of forfeiture against Mbogo and others for  $05,293.7 and Sh22,445,487.74 held in various bank accounts.

In a judgment delivered on November 23, 2017, the High Court held that  former finance manager of the National Water Conservation Authority Stanley Mombo Amuti was in possession of unexplained assets valued at Sh41,208,000 and orders of forfeiture were made.

In 2003, Parliament passed the Anti-Corruption and Economic Crimes Act ) that provided for, among others, forfeiture of unexplained assets by persons holding public office or those related to them in any way, including those holding such assets in trust for such individuals.

And in 2009, it also passed the Proceeds of Crime and Anti-Money Laundering Act, which went into effect in June 2010. The purpose of the Act was to “provide for the offence of money laundering and to introduce measures for combating the offence, to provide for the identification, tracing, freezing, seizure and confiscation of the proceeds of crime, and for connected purposes".

These two Acts of Parliament have substantially domesticated Chapter 5 of the UN Convention on Anti-Corruption and have been critical in the work of various agencies of government to trace and recover billions of shillings in stolen and/or unexplained assets.

In his renewed vigour in the war on graft, President Uhuru Kenyatta has empowered the Financial Reporting Centre and the Assets Recovery Agency to pursue individuals and companies that have pilfered public funds through corrupt practices and ensure such funds are recovered.

The anti-corruption court has also set a standard in the Walukhe/Wakhungu case where convicts of economic crimes are required to refund ALL the money lost and pay a fine of equal value.

In addition, the courts have also weighed in and given the EACC and ARA the much-needed 'clearance' to institute proceedings to recover unexplained assets reasonably suspected to be proceeds of corruption. This was seen in appeal before the Supreme Court refusing to interfere with asset recovery proceedings in lower courts.

With the Supreme Court declining to entertain an appeal in Stanley Mombo Amuti vs Kenya Anti-Corruption Commission (the predecessor of the EACC) (SC Petition No 21 of 2019), the Court of Appeal ruled that under “Section 55(2) of ACECA, an individual has the evidentiary burden to offer satisfactory explanation for legitimate acquisition of the asset or forfeit such asset.

"The cornerstone for forfeiture proceedings of unexplained assets is having assets disproportionate to known legitimate source of income. Tied to this is the inability of an individual to satisfactorily explain the disproportionate assets.

"A forfeiture order under ACECA is brought against unexplained assets which is tainted property; if legitimate acquisition of such property is not satisfactorily explained, such tainted property risk categorisation as property that has been unlawfully acquired.

The requirement to explain assets is not a requirement for one to explain his innocence. The presumption of innocence is a fundamental right that cannot be displaced through a Notice to explain how assets have been acquired."

For as long as Kenya has been independent, political leaders have poured billions of shillings into contributions either at fundraisers or just randomly to organised groups (including religious organisations) and their individual supporters.

This has gone on despite the fact that most of these individuals cannot explain their sources of wealth. In most instances, the source of funds in covered by vague statements like  'Me and My Friends” – with the shadowy friends often corrupt entities seeking or having obtained favours from such politicians.

It is no longer business as usual. Government agencies are asking questions and as has been demonstrated above, culprits are losing entire family fortunes.

Even as government agencies continue with this work, there is a critical role for the so-called hustlers to ask leaders to explain the source of funds they are giving them, which are more often than not stolen public property. Before you receive that Church donation or Wheelbarrow, it is important to ask where the money comes from.

It is likely you are just receiving breadcrumbs from stolen billions of shillings meant to ensure your local hospital has doctors and medicine, your children have a good education and that your medical emergencies do not lead to death because the road from your home to the nearest heath facility is impassable when it rains because money meant for its construction was pilfered.

Ask your benefactors, whether public officers or otherwise, to explain their sources of wealth, failure to which they should forfeit them to the state to help fund critical functions of state for which we pay taxes.

We are firmly in an era where you will lose wealth you cannot explain, as it should be!