Court orders businessman to forfeit high-end car to state

The High Court has ordered businessman Jared Kiasa Otieno to forfeit his high-end car to the state in an application made by the Assets Recovery Authority (ARA).

ARA had sought to have Otieno surrender two vehicles, a Porsche Panamera KCD 966L and a Bentley Continental GT 2019 KCU 966C, to the state for allegedly being proceeds of crime.

“It is therefore my finding that the applicant has proved on a balance of probabilities that the motor vehicle KCU 966C is a proceed of crime,” said Justice Esther Maina.

Justice Maina however noted that she could not deliver a judgement concerning the Porsche Panamera, since a ruling issued by Justice John Onyiego on November 20, 2019, had been appealed at the Court of Appeal by ARA.

In his ruling, Justice Onyiego found that the vehicle was not tied to any criminal activity and was therefore not a proceed of crime.

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The two vehicles were registered under two firms associated with Otieno namely; Cleanen Limited and Yugni Holdings Limited.

ARA told the court that Otieno is allegedly part of an international syndicate which has been in existence since 2013 and had fraudulently obtained money from investors on pretence they had precious metals including gold for sale

The agency in 2019 began investigating the businessman’s activities since 2014 with the view of identifying, tracing, freezing and forfeiture of proceeds of crime.

ARA claimed that Otieno acquired the two vehicles to conceal and disguise the nature, source, location and disposition of funds from unlawful activities through proxies and third parties including a law firm.

He was charged at the Milimani Magistrates Court with conspiracy to defraud, obtaining money by false pretence and counterfeiting.

The High Court heard that he had no source of legitimate income owing to filing nil tax returns with the Kenya Revenue Authority (KRA) during the period that he acquired the cars.

ARA submitted that the Bentley cost USD 453,907.83 (Sh20 million at the time) while the Porsche which cost Sh16 million was initially registered in Otieno’s name before it was transferred to Cleanen Limited.

The price of the vehicle has appreciated owing to the depreciation of the Kenyan shilling against the dollar.

ARA accused Otieno of trying to transfer the ownership of the Bentley to Yugni Holdings to disrupt and evade investigations to conceal, hide and disguise its ownership.

Justice Maina heard that the businessman was allegedly involved in a scheme to defraud Simoung Company Limited and then held a meeting with the company’s director Sounthorn Chantavong.

Corporal Jeremiah Sautet on behalf of ARA said that after obtaining orders to probe the law firm, he established that after the meeting, Simoung transferred USD 3,052,281 in two instalments to Otieno’s accounts.

He told the court that Victoria Achieng’ Ramogi withdrew USD 90,000 from the account in two instalments as business income and she went ahead to make 15 suspicious withdrawals.

According to Sautet, Otieno paid for the vehicles in installments between March 2018 and April 2019 and the law firm acted on his behalf.

He said that the businessman transferred the ownership of the Bentley after he was arraigned and charged in court and this raised suspicion and reasonable ground to believe it had been purchased using proceeds of crime.

Sautet further told court that Otieno’s move to file nil returns with KRA since 2014 showed he had no taxable income yet the two motor vehicles are valued at Sh62.1 million and this formed ground to seek their forfeiture.

Otieno opposed the application saying that he is an honest businessman with lawful dealings locally and internationally.

He said that he was tax-compliant and even produced a compliance certificate as proof, arguing that ARA had not demonstrated a causal link between the criminal case and the vehicles.

“It is my finding that by filing a nil tax return the respondent was saying that he had not generated any income during that period, which period includes that which he acquired the vehicle,” said Justice Maina.

Otieno denied having dealings with the complainant in the criminal case at the Magistrates Court, saying that he was neither a party nor a witness to the transaction and loan agreement that is subject to the case.

He argued that the only nexus between him and Rose Adhiambo Omamo was that they shared a law firm.

The businessman said that he purchased the Porsche in 2015, four years before he was charged in the criminal case and the decision to register the vehicles in the companies was in good faith.

He further argued that the money that was used to pay for the Bentley was a commission that he had earned from a land transaction between Kanaiya Ole Rotiken Sapuru and Euro Ceramics Limited.

ARA through their lawyer said that their application’s burden of proof was on a balance of probabilities.

The lawyer submitted that they had attached an evidential burden of proof for Otieno to demonstrate how he came into possession of the property in question.

Otieno’s lawyers told the court that ARA did not attach new evidence for the forfeiture of the Porsche, whose ruling they challenged at the Court of Appeal.

They said that the agency had not submitted the correlation between the alleged USD 3,000,000 that their client allegedly received and is subject to criminal proceedings to the said vehicles.

While faulting ARA they said the agency started probing their client in 2019 yet the Bentley was purchased using a commission he earned in a land transaction in 2018 totaling to Sh22 million.

According to the lawyers, ARA had failed to link Otieno with any criminal activities and that the application was premised on mere suspicion and postulation.

The judge noted that Otieno’s initial affidavit had not indicated where he got the money to buy the Bentley and he only did so in a supplementary affidavit, and his lawyers did not seek leave before filing.

“There is also nothing on the record to prove that the affidavit was served upon the Applicant,” said the judge.

“Any pleading filed without the leave of the court is fodder for striking out and the Respondent’s Supplementary Replying Affidavit must be and is hereby struck out.”

She noted that striking out the supplementary affidavit left Otieno with no evidence to prove the source of the funds and even if she did not do so he did not give evidence that he acted as an agent let alone that he was licensed to do so.

“He did not also produce an agreement that he was to receive a commission,” said the judge.

Justice Maina found that there was no evidence to prove that Otieno was engaged in lawful business, as evidenced by his nil tax returns and there was no admissible evidence of him earning the commission.