17 YEARS ON

Man seeks release of millions frozen over fraud charges

John Mwangi says the Sh14 million has earned interest and amounted to Sh85 million as of last year.

In Summary

• The money was frozen following an application by the Central Bank of Kenya in 2003.

• Judge George Odunga ruled that the sum in question was not part of the stolen money. 

Milimani law courts
Milimani law courts
Image: FILE

Seventeen years after he was charged with stealing treasury bonds worth Sh205 million, John Mwangi is seeking the release of his cash that was frozen.

He says part of his money (Sh14 million) was frozen following an application by the Central Bank of Kenya in 2003. The amount, he says, has earned interest and amounted to Sh85 million as of last year.

Mwangi has based his application on High Court Judge George Odunga’s ruling that the sum in question was not part of the stolen money. And as a result, he wants it given to him. He has sought a court verdict on the same. 

In December, Justice Odunga directed Jignesh Desai and Alex Ribero Ngugi to refund the CBK the Sh205 million they fraudulently acquired in 2003 through the purchase of treasury bonds.

The Central Bank had sued Giro Commercial Bank Ltd, Desai and Ngugi, who traded as Mpesha Enterprises. Mwangi’s company was acquitted of the fraud charges.

The CBK took the view that Desai, being a bank manager, assisted Mwangi in opening a CDS account in a casual way without compliance with rules. According to evidence presented during the trial, the account was opened on the same date the business was registered and without the financial statement of the business for the previous 12 months.

There was also no verification as to whether the proprietor was a registered taxpayer and there were no details of the permanent address of the business or evidence of reference from the introducing party. And after opening the account, Ngugi fraudulently procured T Bonds in the names of CBA Capital and Mumbu Holdings Limited.