Kisumu court jails family trio 10 years for Sh113 million money laundering, business fraud

Kisumu court jails family trio 10 years for Sh113 million money laundering, business fraud

A Kisumu Magistrate's Court found that the trio worked together to divert customer payments, conceal the money and disguise its ownership through accounts associated with the family.

Three members of the same family have been sentenced to a combined 10-year prison term for money laundering and business fraud involving Sh113.2 million stolen from a Kisumu-based company.

A Kisumu Magistrate's Court found that the trio worked together to divert customer payments, conceal the money and disguise its ownership through accounts associated with the family.

The convicts are Christopher Joseph Okal, his brother Vincent Anyumba and their mother Grace Minayo Okal, who were found guilty of all six counts brought against them by the prosecution.

The three were sentenced to 10 years in prison for money laundering contrary to Section 3(a), (b), (i), (ii) and (iii), as read with Section 16(1)(a) of the Proceeds of Crime and Anti-Money Laundering Act.

They also received 10-year jail terms for acquiring and possessing proceeds of crime contrary to Section 4(a), (b) and (c), read with Section 16(1)(a) of the same law.

In addition, each received a five-year sentence for conspiracy to commit a felony under Section 393 of the Penal Code.

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Okal, who worked as an accountant at Such Enterprises Limited, was handed another five-year sentence for stealing by servant under Section 281, fraudulent false accounting under Section 330(b), and stealing under Section 275 as read with Section 268 of the Penal Code.

His mother and brother were each sentenced to three years in prison for stealing under Section 275 as read with Section 268 of the Penal Code.

The case arose from the fraudulent diversion of customer payments and wholesale goods worth Sh113.2 million from the company on different dates between October 2020 and July 2021.

The prosecution, led by Deputy Director of Public Prosecutions Daniel Karuri and Principal Prosecution Counsel Douglas Moseti, told the court that the three knowingly handled money and property obtained through theft, with the intention of concealing its source and ownership.

After the accused denied the charges, the prosecution presented witnesses, including company employees, customers, bank officials, forensic examiners and investigating officers, to explain how the fraud was carried out.

The court heard that Okal manipulated the company's accounting system by creating false transactions and directing customer payments into accounts linked to his mother and brother instead of the company's official accounts.

Forensic document examination presented by the prosecution showed that he used his access privileges to alter records and hide the transactions.

"An audit report also established that Sh113,227,529 could not be accounted for," the prosecution said.

Further evidence showed that customers had been instructed to deposit money for goods into bank and mobile money accounts associated with the three family members rather than the company's authorised accounts.

The court rejected the convicts' argument that the transactions were legitimate business arrangements, finding that the evidence demonstrated a coordinated plan to defraud the company and conceal the stolen money.

In her ruling, Senior Principal Magistrate Fatuma Rashid said she was persuaded by the prosecution that Okal was the mastermind behind the fraud and had provided his mother's and brother's accounts to hide the trail of money received from customers.

During the sentencing proceedings, Karuri asked the court to impose at least 10 years in prison on the convicts for stealing and participating in money-laundering activities involving the diverted payments.

After weighing the evidence presented by both sides, Magistrate Fatuma found that the prosecution had proved its case against the three on all the counts.

She subsequently convicted and sentenced them under Section 215 of the Criminal Procedure Code.

The court directed that all the prison terms run concurrently, meaning the convicts will serve the sentences at the same time.

The three have 14 days to appeal against both their convictions and sentences.