- The funds are proceeds of crime and are therefore liable to be handed to the state.
- Motor vehicles were modified to create a secret compartment where the illicit goods were hidden.
Businessman Josphat Kamau who is accused of smuggling 40 cartons of cigarettes valued at Sh9.7 million has been ordered to forfeit Sh44 million to the state.
High Court Judge James Wakiaga on Tuesday said the Assets Recovery Agency proved that the funds held in Kamau’s bank account are proceeds of crime and are therefore liable to be handed to the state.
The funds once forfeited will be deposited in the Assets Recovery Agency’s Account held at Kenya Commercial Bank Ltd KICC Branch.
ARA filed the case in court early last year seeking to have Kamau’s accounts frozen and the monies forfeited to the state. The accounts had a total of Sh43 million.
The freezing order was granted.
ARA told the court that preliminary investigations established that there were reasonable grounds to believe that the funds in Kamau’s accounts were obtained through the illegitimate trade of smuggled goods.
“We believe that the accounts are holding proceeds of crime and are used as conduits for money laundering," ARA said.
Kamau had been charged jointly with another person for smuggling and importation of restricted goods in the Eldoret chief magistrate's court.
In his defence, he said the vehicles which were impounded are of more value than the money in his accounts. He said he uses them for his cereal business.
"I have been engaged in cereals business since 2014 without interference. It was only until October 26 last year when I was arrested on the basis that the vehicles had been detained for transporting restricted goods," Kamau said.
Justice Wakiaga said any business must have records to support its operations.
He said it is not enough for Kamau to state that he has been in business since October 29, 2014 and that he owns heavy commercial vehicles which are financed by financial institutions.
Kamau contended that he had been receiving large sums of money from his business since 2014 but the judge said he had failed to sufficiently account for the sources of the said sums of money.
“It was upon Kamau to show that he was engaged in legitimate business with records of the transactions, if any, for the period under inquiry.
"Kamau however did not account for the sums of money received and also the large cash withdrawals from his bank accounts,” Wakiaga said.
The court also said Kamau failed to disapprove claims that his motor vehicles were modified for the purposes of concealing unaccustomed goods.
“There is evidence placed before court that Kamau’s motor vehicles were modified to create a secret compartment where the illicit goods were hidden,” Wakiaga said.
(Edited by Bilha Makokha)