Three family members have been sentenced to 10 years in prison by a Kisumu court over their involvement in a KSh113.2 million fraud scheme targeting Such Enterprises Limited.
The Director of Public Prosecutions (DPP) secured the convictions of Christopher Joseph Okal, his brother Vincent Anyumba and their mother, Grace Minayo Okal, after the court found them guilty of money laundering, acquiring and possessing proceeds of crime, and other offences.
Senior Principal Magistrate Fatuma Rashid, sitting at the Kisumu Magistrate’s Court, found the three guilty on all six counts brought against them by the prosecution.
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The case was prosecuted by a team led by Deputy Director of Public Prosecutions Daniel Karuri and Principal Prosecution Counsel Douglas Moseti.
The three were convicted of 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 were also sentenced to 10 years in prison for acquiring and possessing proceeds of crime, contrary to Section 4(a), (b) and (c), as read with Section 16(1)(a) of the same Act.
Additionally, each received a five-year prison sentence for conspiracy to commit a felony under Section 393 of the Penal Code.
Christopher Joseph Okal, who worked as an accountant at Such Enterprises Limited, faced additional sentences linked to stealing by servant, fraudulent false accounting and stealing under the Penal Code.
Okal received a further five-year sentence for stealing by servant and fraudulent false accounting, while Okal and Anyumba were each sentenced to three years for stealing.
The court ordered that all the prison terms run concurrently.
How the KSh113.2 million fraud was carried out
The charges arose from the fraudulent diversion of customer payments and wholesale goods worth KSh113.2 million from Such Enterprises Limited in Kisumu.
The offences were committed on various dates between October 2020 and July 2021.
The prosecution told the court that the three knowingly engaged in transactions involving money and property obtained through theft, with the intention of concealing or disguising the proceeds' source or ownership.
Evidence presented during the trial showed that Okal allegedly manipulated the company's accounting system by creating fictitious transactions and diverting customer payments into accounts linked to his co-accused.
Forensic document examination and other evidence presented by the prosecution showed how Okal used his access privileges to alter company records and conceal transactions.
An audit report identified KSh113,227,529 that had not been accounted for.
The court heard that some customers had been instructed to deposit payments for goods into bank and mobile money accounts associated with the accused persons instead of the company's official accounts.
Court rejects defence explanation
The three denied the charges and maintained that the transactions were legitimate business arrangements.
However, the court rejected their explanation, finding that the prosecution had presented evidence demonstrating a coordinated scheme to defraud the company and conceal the proceeds.
Magistrate Rashid found that Okal had organised the scheme and used accounts belonging to himself and Anyumba to receive payments diverted from customers.
The prosecution called witnesses, including company employees, customers, bank officials, forensic examiners and investigating officers, to explain how the scheme was carried out.
In his sentencing submissions, Deputy Director of Public Prosecutions Daniel Karuri urged the court to impose substantial prison terms, citing the theft and money-laundering activities linked to the diverted payments.
After weighing the prosecution's evidence against the defence, the magistrate concluded that the case had been proved against all three accused persons on the charges they faced.
The court subsequently convicted and sentenced them under Section 215 of the Criminal Procedure Code.
The convicts have 14 days to appeal against both the convictions and the sentences.