An online broker sued in December by over 1,400 forex investors for the release of Sh2.9 million was yesterday charged with falsely obtaining Sh3.9 million.
Manases Karanja was charged in a Milimani court with obtaining money by false pretences from seven people.
Karanja denied all the charges and was released on a Sh1 million cash bail by chief magistrate Francis Andayi.
In December last year, the investors moved to court seeking the release of Sh2.9 million from the man accused of illegally running a forex business.
The investors sought the reopening of the bank accounts held in Karanja’s name that had remained closed for over three months.
“We are seeking the release of funds directly to the investors as we do not know the circumstances under which the accounts were frozen,” court papers read.
In early December, a Nairobi court barred Karanja from accessing any funds held in his bank accounts or making transactions.
He had on October 2 been charged with a different count of carrying out business as an online broker without a license.
Court documents say he committed the offence between January 1, 2018 and August 2019 at View Park Towers where he was a director of Inter-Web Global Fortune Limited.
Karanja is alleged to have invited the public to invest by depositing the funds with him for a monthly return of 20 per cent of the amount.
He was also to give a full refund of the initial deposit upon termination of relations.
“The applicants having no doubt on the legality of the business in question invested in the business on diverse dates with funds totalling to Sh2,910,000,” court documents read.
The online broker is said to have paid the 20 per cent to the applicants for a while without fail.
He, however, failed to make the August monthly remittance and on inquiry, applicants learnt that he had been charged with illegally operating the business by the Capital Markets Authority.
His bank accounts were allegedly frozen by the Central Bank of Kenya, a claim the accused denied.
“Between August 9 and August 19, there was a directive from the CBK for closure of all accounts dealing with online foreign exchange,” Karanja said through his lawyer.
More than four months down the line, the authorities are yet to inform the applicants whether or not they will recover their money.
