Firms to forfeit Sh18m in money laundering case

The High Court has given the greenlight for recovery of over Sh18 million from two private jet leasing firms, linked to businessman Chris Obure.

The Assets Recovery Agency will recover the monies from Cullinan Private Jets Corp and Glo Jet International Limited, following suspicions of their involvement in a complex international money laundering syndicate.

In a judgment delivered by Justice Patrick Otieno at the Milimani High Court Anti-Corruption Division, it was declared that the sums of money held in various accounts belonging to the two firms, subsidiaries of United States-registered companies, were derived from illegal activities and should be forfeited to the state as proceeds of crime.

The decision follows investigations that uncovered a money laundering syndicate involving the firms, which are subsidiaries of US-based private air charter companies.

These funds, amounting to USD 54,257.85 and Sh696,070.70 in the account of Cullinan Private Jets Corp at I&M Bank, as well as USD 24,712.61 and Sh1,134,691.33 in the account of Glo Jet International Limited at Ecobank, were ordered forfeited to the government.

.

Keep Reading business

•  Surge in high-end hotels spurs visits by foreign tourists
•  Flats dominate property market as leasing now outpaces rentals
•  Health funding falls 7pc amid America's WHO withdrawal
•  Parklands and Upperhill top land price surge
•  No home, no insurance: Double hit from Los Angeles fires

“These sums are proceeds of crime and are hereby forfeited to the state,” Justice Otieno ruled.

The court ordered the two banks to transmit the forfeited amounts to ARA within seven days, once served with the formal court order.

The case stems from a complaint filed by Rondell Fletcher, a California-based businessman, who alleged he was defrauded by the two firms after he made substantial payments of USD 412,000 for cargo and passenger charter services that were never provided.

Fletcher claimed that in August 2023, he paid USD 412,746.55 to the firms, expecting the charter services to transport goods from Nairobi to Dubai.

However, the flight was never booked, and the money was allegedly diverted for other purposes, raising suspicions of money laundering.

“I was led to believe I was engaging in a legitimate business transaction, but after I made the payments, nothing happened,” Fletcher said during the case proceedings.

“The services were never provided, and no aircraft was shown to me.”

Alfred Musalia, the investigator handling the case, testified that the complex ownership structure of the firms and the flow of funds raised significant concerns of money laundering.

“The movement of money and the intricate shareholding between the companies made it clear that the funds were not being used for legitimate business purposes,” Musalia explained in court.

In his defense, businessman Obure, who represents the firms locally, argued that the funds were received in the ordinary course of business and were part of a legitimate transaction.

Through their lawyers, the firms explained that Fletcher had initially inquired about the services and had made the payments for a cargo and passenger flight.

“On August 1, 2023, we received an inquiry from Fletcher for cargo and passenger charter services. He paid the agreed amount, and we sent the necessary funds to cater for the flight preparations,”

“The funds were received as part of a legitimate business agreement.” the private jet firms lawyer told the court.

“We were prepared to carry out the agreed service, but unforeseen circumstances prevented the flight from taking place.”

However, the court was not satisfied with this defense.

Justice Otieno pointed out that the firms failed to produce any tangible evidence that they had the required facilities, including a licensed jet, to carry out the services they had promised as claimed.

“There was no evidence of an aircraft being available for Fletcher’s use, nor any documentation showing that the firms were authorized to offer such services in Kenya.

“It was crucial for the respondents to demonstrate that they had the necessary facilities and licenses to carry out the agreed business,” Justice Otieno said.

“They failed to provide convincing proof that they were operating legally, and the funds were diverted to unrelated purposes.”

The court emphasized that the onus was on the firms to prove that the funds were obtained legally.

“As such, the funds must be forfeited to the state to deter criminal activities and protect the interests of the public.