Financial Crime World

Kenya Grapples with Rising Tide of Financial Crimes, Corruption Persists

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Kenya’s economic growth is being stifled by rampant financial crimes and corruption, which have far-reaching consequences for the country’s prosperity. Despite efforts to combat corruption, the prevalence of economic crimes remains a significant challenge.

The Scale of the Problem

According to recent statistics, the number of reported economic crimes in Kenya reached an all-time high of 4,786 in 2019. Furthermore, 58% of respondents indicate that they have experienced some form of economic crime in the last two years.

Corruption Persists

Kenya’s ranking on Transparency International’s Corruption Perception Index (2020) stands at a dismal 124 out of 180 countries, tied with Pakistan and Bolivia. This indicates that corruption remains a significant challenge for the country.

Kenya has a legal framework designed to combat financial crimes and corruption. Some of the key institutions and laws include:

  • Ethics and Anti-Corruption Commission Act
  • Anti-Corruption and Economic Crimes Act (2003)
  • Kenya Anti-Corruption Commission
  • Central Bank of Kenya Act, among others

High-Profile Cases

Several high-profile cases have made headlines in recent years, including the conviction of Kenya’s former head of Port Authority in 2008. The Kenya Anti-Corruption Commission has achieved a 100% success rate in five subsequent cases, recovering an estimated USD 6.4 million in funds.

Some notable cases include:

  • Stanley Mombo Amuti v KACC SC Petition No.21 of 2019 (Appeal No.184 of 2018 at Nairobi), which raised constitutional questions about the forfeiture of unwanted wealth.
  • EACC v Patrick Ochieno Abachi & 6 ors Civil Suit No.15 of 2019, where the Ethics and Anti-Corruption Commission challenged an individual to explain the source of his assets.

The Goldenberg Scandal

The Goldenberg Scandal, a political corruption case involving Kenya’s government under Daniel Arap Moi, has been widely criticized for its impact on the country’s economy. The scandal involved the payment of subsidies to the company Goldenberg International, resulting in losses equivalent to over 10% of the country’s annual GDP.

Recent Developments

The Ethics and Anti-Corruption Commission has linked three governors and a county boss to unexplained wealth worth KES 11 billion (approximately USD 100 million).

Way Forward

Experts are urging for greater speed in resolving cases, improved training for judges and prosecutors, and increased skills in obtaining evidence of civil illicit enrichment. With these efforts, Kenya can hope to make progress in combating corruption and promoting economic growth.

By addressing the issue of financial crimes and corruption, Kenya can create a more favorable business environment, attract foreign investment, and promote sustainable economic growth.