Post by job on Feb 15, 2007 22:32:02 GMT 3
Folks,
Kenya does not yet have a law against money laundering. The government had promised that the Proceeds of Crime and Money Laundering (Prevention) Bill 2005 would be passed by Parliament, but this has not happened. Finance Minister Amos Kimunya was to introduce the Bill in parliament but has since kept dragging his feet (even beyond parliamentary recess) on this crucial issue.
While drug dealing and corruption thrives unabatted, it seems some cunning government insiders still need loopholes through which to launder their ill gotten money, hence the conspicuous DELAY.Why doesn't the Kibaki government want to urgently control money laundering?
Kimunya may want to hide behind his Treasury doors but people have not forgetten what is expected from him.
Needless to add, Kimunya failed to resolve and report back to Parliament, questions regarding the banks dealings & cross-ownership with Nakumatt and other firms accused of evading tax running into billions. A report on the banks money laundering activities & that led to it's eventual closure is also sitting on his desk gathering dust while questions still linger about the status of CharterHouse Bank & monies owed to depositors.
Sanjay Shah's CharterHouse bank continues to show impunity as expressed by the vigour at which they legally feigned off & blocked duties by the appointed statutory manager Rose Detho.
Even Detho herself ( a CBK/Kimunya appointee) has her own issues. Shadow Finance Minister Billow Kerrow takes issue with the statutory manager saying her record was wanting. He alleges that the manager was once compromised and assisted by two depositors of Prudential Bank to right offer debts amounting to over 600 million shillings. WHY CAN'T WE SOMETIMES HAVE CLEAN, QUALIFIED KENYANS OF HIGH INTEGRITY DOING SOME OF THESE JOBS?
The Kanu MP said it was shocking that Nakumatt which owns 10% of CharterHouse bank, made losses according to its accounts and failed to pay tax and remit VAT worth billions, yet it continued opening branches countrywide. "
It is simply dissapointing to see a bunch of foreigners looting and impoverishing (denying us deserved revenue) our population while buying protection from government leaders.
Kerrow says investigations by a Due Diligence team that consisted of experts from Kar and CBK unearthed a 34 billion shillings tax rip off by Nakumatt through fictitious accounts it held in the Bank in only three years.
WHY IS KIMUNYA STILL SILENT ON THIS? KENYANS NEED THIS MONEY RIGHT INTO THE EXCHEQUER SOONER THAN LATER.
CharterHouse gained notoriety starting 2001 when they came to limelight for ironically reporting a suspected case of money laundering by a company called Crucial properties. I guess this was a case of deal-gone-bad where their kick-back from the loot wasn't guaranteed by the "owners" of the laundered cash. CharterHouse had to give them away.
Revisiting the case,......................
The Crucial Properties Case
In January 2001 Charter House Bank reported to the CBK, as required by law, the receipt of US$25 million (about Sh 2 billion) into the account of a company called Crucial Properties. Following this notification, the fraud investigation unit (hereafter the unit) of CBK applied for a magistrate’s order freezing the account of Crucial Properties and for warrants of search to enable the unit to investigate the account. The unit stated in its application that it believed the money to be proceeds of a theft or drug deal.
After the account was frozen the head of the unit wrote to Charter House Bank asking to be furnished with all the information relating to transactions that had taken place through the account. Charter House Bank, however, declined the request, claiming it had no legal obligation to co-operate with the unit. The bank further asserted that it was bound by the requirement to keep its customers’ affairs confidential.
THIS WAS THE BEGINNING OF CHARTERHOUSE BANK EXPOSITION.
The unit continued with its investigation, notwithstanding this setback. The investigation established that Crucial Properties had been incorporated in Kenya in May 1998 with two directors. In December 2000 the company opened a foreign currency account at Charter House Bank and then passed a resolution to introduce Humphrey Kariuki as an additional director. Kariuki was to be the star player in the court cases that followed the report of money’s receipt by Charter House Bank. Soon after Kariuki became a director, the money was remitted into the account.
Questioned about the source of the money, Kariuki claimed that it was transferred from Jersey “for property development and trading within Africa ”.
The unit, however, asserted that the source of the money was not Jersey, as claimed, but Liechtenstein, in Europe. The unit also asserted that Kariuki had failed to provide a proper explanation as to the source of the money which, the unit now said, was the proceeds of drug trafficking.
Crucial Properties then made an application in the High Court for the lifting of the magistrate’s order freezing its account. That application was never heard as the unit voluntarily caused the magistrate’s order to be discharged and then applied to the High Court for an order to restrain the money under the Narcotics Drugs and Psychotropic Substances Act. The High Court initially granted this order.
The Narcotics Act provides that the High Court may make such an order to freeze money if it is suspected to be the proceeds of a specified offence. A specified offence is defined to include all the serious offences in relation to drugs trafficking under the Act, with a provision that the Attorney-General may add to the list of specified offences.
Money laundering, although an offence under the Act, was not a specified offence at the time the money was received in Kenya. Since the unit claimed to be investigating the offence of money laundering, it sought a restraint of the money, only to then realise the legal deficiency. This it sought to cure through a belated notice in the Gazette declaring money laundering a specified offence, so that it could avail itself of the power to restrain the money through a court order.
The proceedings that followed degenerated into a farce. The Attorney-General’s belated notice making money laundering a specified offence was declared a nullity by the High Court on the grounds that it amounted to a retrospective application of criminal law. The unit, it turned out, had assumed that Jersey, the claimed source of the money, was the same as New Jersey in the US, and therefore directed its investigation to the US.
The High Court grew impatient over the slow pace by the unit to substantiate its claim that the money had come from Liechtenstein as proceeds of drug trafficking. The judge, rather spectacularly, declared that money laundering was, after all, not an offence in Kenya due to the previous failure to declare it a specified offence. He concluded that, in any case, he had “no reason to believe that these highly reputed international banks can engage in money laundering”, and ordered the money to be released to Crucial Properties.
With the money gone, the unit had no strong incentive to go on with the case and closed its investigation.
CHARTERHOUSE BANK HAD BY NOW OFFICIALLY DEMONSTRATED HOW EASY MONEY LAUNDERING WAS IN VIEW OF THE LACKING LAWS TO CURB IT. IT ALSO PROVED THAT IT CAN IGNORE CBK's BANKING REGULATIONS WITH IMPUNITY.
TODAY, CHARTERHOUSE seems the prefered MONEY LAUNDERING AVENUE for PROCEEDS SOURCED FROM ; CORRUPTION, THEFT, DRUG TRAFFICKING, BANK ROBBERIES, ILLEGAL ARMS TRADE (to war torn regions) ETC,..... WHICH CONTINUES UNABATTED RIGHT UNDER OUR NOSES.
LET US KEEP WAITING FOR KIMUNYA'S WORD ON MONEY LAUNDERING AND THE BILL OWED TO KENYA BY NAKUMATT & OTHERS.
unedited.
Job.
Kenya does not yet have a law against money laundering. The government had promised that the Proceeds of Crime and Money Laundering (Prevention) Bill 2005 would be passed by Parliament, but this has not happened. Finance Minister Amos Kimunya was to introduce the Bill in parliament but has since kept dragging his feet (even beyond parliamentary recess) on this crucial issue.
While drug dealing and corruption thrives unabatted, it seems some cunning government insiders still need loopholes through which to launder their ill gotten money, hence the conspicuous DELAY.Why doesn't the Kibaki government want to urgently control money laundering?
Kimunya may want to hide behind his Treasury doors but people have not forgetten what is expected from him.
Needless to add, Kimunya failed to resolve and report back to Parliament, questions regarding the banks dealings & cross-ownership with Nakumatt and other firms accused of evading tax running into billions. A report on the banks money laundering activities & that led to it's eventual closure is also sitting on his desk gathering dust while questions still linger about the status of CharterHouse Bank & monies owed to depositors.
Sanjay Shah's CharterHouse bank continues to show impunity as expressed by the vigour at which they legally feigned off & blocked duties by the appointed statutory manager Rose Detho.
Even Detho herself ( a CBK/Kimunya appointee) has her own issues. Shadow Finance Minister Billow Kerrow takes issue with the statutory manager saying her record was wanting. He alleges that the manager was once compromised and assisted by two depositors of Prudential Bank to right offer debts amounting to over 600 million shillings. WHY CAN'T WE SOMETIMES HAVE CLEAN, QUALIFIED KENYANS OF HIGH INTEGRITY DOING SOME OF THESE JOBS?
The Kanu MP said it was shocking that Nakumatt which owns 10% of CharterHouse bank, made losses according to its accounts and failed to pay tax and remit VAT worth billions, yet it continued opening branches countrywide. "
It is simply dissapointing to see a bunch of foreigners looting and impoverishing (denying us deserved revenue) our population while buying protection from government leaders.
Kerrow says investigations by a Due Diligence team that consisted of experts from Kar and CBK unearthed a 34 billion shillings tax rip off by Nakumatt through fictitious accounts it held in the Bank in only three years.
WHY IS KIMUNYA STILL SILENT ON THIS? KENYANS NEED THIS MONEY RIGHT INTO THE EXCHEQUER SOONER THAN LATER.
CharterHouse gained notoriety starting 2001 when they came to limelight for ironically reporting a suspected case of money laundering by a company called Crucial properties. I guess this was a case of deal-gone-bad where their kick-back from the loot wasn't guaranteed by the "owners" of the laundered cash. CharterHouse had to give them away.
Revisiting the case,......................
The Crucial Properties Case
In January 2001 Charter House Bank reported to the CBK, as required by law, the receipt of US$25 million (about Sh 2 billion) into the account of a company called Crucial Properties. Following this notification, the fraud investigation unit (hereafter the unit) of CBK applied for a magistrate’s order freezing the account of Crucial Properties and for warrants of search to enable the unit to investigate the account. The unit stated in its application that it believed the money to be proceeds of a theft or drug deal.
After the account was frozen the head of the unit wrote to Charter House Bank asking to be furnished with all the information relating to transactions that had taken place through the account. Charter House Bank, however, declined the request, claiming it had no legal obligation to co-operate with the unit. The bank further asserted that it was bound by the requirement to keep its customers’ affairs confidential.
THIS WAS THE BEGINNING OF CHARTERHOUSE BANK EXPOSITION.
The unit continued with its investigation, notwithstanding this setback. The investigation established that Crucial Properties had been incorporated in Kenya in May 1998 with two directors. In December 2000 the company opened a foreign currency account at Charter House Bank and then passed a resolution to introduce Humphrey Kariuki as an additional director. Kariuki was to be the star player in the court cases that followed the report of money’s receipt by Charter House Bank. Soon after Kariuki became a director, the money was remitted into the account.
Questioned about the source of the money, Kariuki claimed that it was transferred from Jersey “for property development and trading within Africa ”.
The unit, however, asserted that the source of the money was not Jersey, as claimed, but Liechtenstein, in Europe. The unit also asserted that Kariuki had failed to provide a proper explanation as to the source of the money which, the unit now said, was the proceeds of drug trafficking.
Crucial Properties then made an application in the High Court for the lifting of the magistrate’s order freezing its account. That application was never heard as the unit voluntarily caused the magistrate’s order to be discharged and then applied to the High Court for an order to restrain the money under the Narcotics Drugs and Psychotropic Substances Act. The High Court initially granted this order.
The Narcotics Act provides that the High Court may make such an order to freeze money if it is suspected to be the proceeds of a specified offence. A specified offence is defined to include all the serious offences in relation to drugs trafficking under the Act, with a provision that the Attorney-General may add to the list of specified offences.
Money laundering, although an offence under the Act, was not a specified offence at the time the money was received in Kenya. Since the unit claimed to be investigating the offence of money laundering, it sought a restraint of the money, only to then realise the legal deficiency. This it sought to cure through a belated notice in the Gazette declaring money laundering a specified offence, so that it could avail itself of the power to restrain the money through a court order.
The proceedings that followed degenerated into a farce. The Attorney-General’s belated notice making money laundering a specified offence was declared a nullity by the High Court on the grounds that it amounted to a retrospective application of criminal law. The unit, it turned out, had assumed that Jersey, the claimed source of the money, was the same as New Jersey in the US, and therefore directed its investigation to the US.
The High Court grew impatient over the slow pace by the unit to substantiate its claim that the money had come from Liechtenstein as proceeds of drug trafficking. The judge, rather spectacularly, declared that money laundering was, after all, not an offence in Kenya due to the previous failure to declare it a specified offence. He concluded that, in any case, he had “no reason to believe that these highly reputed international banks can engage in money laundering”, and ordered the money to be released to Crucial Properties.
With the money gone, the unit had no strong incentive to go on with the case and closed its investigation.
CHARTERHOUSE BANK HAD BY NOW OFFICIALLY DEMONSTRATED HOW EASY MONEY LAUNDERING WAS IN VIEW OF THE LACKING LAWS TO CURB IT. IT ALSO PROVED THAT IT CAN IGNORE CBK's BANKING REGULATIONS WITH IMPUNITY.
TODAY, CHARTERHOUSE seems the prefered MONEY LAUNDERING AVENUE for PROCEEDS SOURCED FROM ; CORRUPTION, THEFT, DRUG TRAFFICKING, BANK ROBBERIES, ILLEGAL ARMS TRADE (to war torn regions) ETC,..... WHICH CONTINUES UNABATTED RIGHT UNDER OUR NOSES.
LET US KEEP WAITING FOR KIMUNYA'S WORD ON MONEY LAUNDERING AND THE BILL OWED TO KENYA BY NAKUMATT & OTHERS.
unedited.
Job.
