Fight Against Financial Crimes in Kenya: Key Cases and Challenges

Financial crimes, including tax fraud, procurement fraud, money laundering, bribery, corruption, asset misappropriation, and accounting statement fraud, pose a significant threat to Kenya’s economy. According to data from Xpress Money, the number of reported economic crimes to the Kenya Police hit a record high of 4,786 in 2019. Despite this, the prevalence of these crimes seems to be declining. Here are some highlights of the fight against financial crimes in Kenya, including key cases and challenges.

Prevalence of Financial Crimes in Kenya

The prevalence of financial crimes in Kenya is a cause for concern, with Kenya ranking 124th out of 180 countries for corruption, according to the Corruption Perception Index 2020 by Transparency International. Kenya’s position in this index is alongside countries like Pakistan, Bolivia, and others.

Government Efforts to Combat Financial Crimes

Despite the challenges, the Kenyan government has made significant strides in combating financial crimes. Since 2003, the legal and institutional frameworks have been fortified to address economic crimes. The Ethics and Anti-Corruption Commission Act (EACCA) has had a 100% success rate in recovering funds following successful prosecutions of financial crimes, amounting to approximately USD 6.4 million.

Notable Cases

Some notable cases include the Stanley Mombo Amuti vs. KACC SC Petition No. 21 of 2019, where the constitutionality of S. 55 of the EACCA, which provides for the forfeiture of unwanted wealth, was contested. Another significant case was EACC vs. Patrick Ochieno Abachi & 6 ors Civil Suit No. 15 of 2019, where the Commission successfully challenged the Respondent to explain the source of their wealth and assets.

Challenges to Unexplained Wealth Recovery Proceedings

Despite the successes, unexplained wealth recovery proceedings in Kenya are often met with challenges in the courts. Violations of the right to a fair trial and presumption of innocence are common issues.

Goldenberg Scandal - A Major Setback

One striking case of economic mismanagement that dealt a significant blow to Kenya’s anti-corruption efforts was the Goldenberg Scandal. The Central Bank of Kenya lost an estimated 10% of its annual Gross Domestic Product following a political scandal involving the government under Daniel Arap Moi. Despite officials being prosecuted, key players in the scandal were ruled immune from prosecution by the Constitutional Court, undermining the effectiveness of the law.

Recent Developments

More recent developments include the EACC investigating 3 governors and a county boss for Sh 11Billion in unexplained wealth, nearly half of the Sh 25 Billion illicitly acquired by public servants over the past 5 years. Jomo Kenyatta’s fight against unexplained wealth and Nairobi’s County Chief Officer Finance, Jimmy Kiamba, being awarded KES 31Million by the High Court for failing to adequately explain the source of their wealth are other notable cases.

Conclusion

The fight against financial crimes in Kenya remains ongoing, with several high-profile cases currently under investigation or making their way through the courts. The resolution of these cases and continued acquaintance with the law on the part of judges, prosecutors, and investigators is essential to strengthening Kenya’s efforts in the war on financial corruption. The public’s role in reporting suspicious activities and demanding transparency is also essential for creating a corruption-free society.