Switzerland’s Ambassador to Kenya Jacques Pitteloud has admitted to asking controversial businessman Deepak Kamani to pay $55 million (Sh5 billion) over his Anglo Leasing-type cases.
Mr Pitteloud, however, disputes Mr Kamani’s claim in a Nairobi court that this was an attempt to extort money from the the billionaire businessman, who is under investigation by Swiss and Kenyan authorities over suspected money laundering and irregular dealings.
In an exclusive interview, the ambassador told the Business Daily on Thursday that he privately approached Mr Kamani and asked him to pay the sum, about Sh4.8 billion, to Swiss federal authorities.
He said the money was not a bribe, but was a settlement to help Mr Kamani avoid prosecution for offences arising from irregular contracts between the tycoon’s companies and the Kenyan government. Mr Pitteloud alleged that Kenyan and Swiss authorities okayed the offer.
Last month, Mr Kamani accused the Swiss ambassador of trying to extort $55 million from him, a small fraction of the over $600 million (more than Sh50 billion) involved in the Anglo Leasing scandal.
The scam relates to 18 security-related contracts awarded to firms that either did not render services or deliver goods paid for, or supplied substandard equipment at highly inflated prices.
The scandal unearthed in 2004 saw key officials in former President Mwai Kibaki’s government adversely mentioned. They included former Vice-President Moody Awori, former Internal Security minister Chris Murungaru and former Finance minister David Mwiraria. They denied the accusations levelled against them.
Mr Kamani and Sri Lanka-born billionaire Anura Perera were reported to be the key players in many of the contracts.
Mr Kamani, whose Anglo Leasing-type companies allegedly moved proceeds from the contracts through Swiss banks, is under investigation by Swiss authorities for money laundering.
The Kenyan government is also investigating him for other offences related to the irregular deals and has requested mutual legal assistance with Switzerland.
Mr Kamani now claims that Mr Pitteloud tried to extort money from him at his Kyuna residence in May and wants the High Court to stop the government from helping Swiss authorities investigating him for money laundering.
In his suit papers, the tycoon attached copies of text messages between him and Mr Pitteloud, and alleged that the Swiss ambassador threatened to initiate the money laundering investigations against him if he did not pay the billions he was asking for.
Mr Pitteloud maintains that he had been directed by Switzerland’s attorney-general to ask Mr Kamani to return the funds he is alleged to have acquired from the Anglo Leasing contracts in exchange for immunity in the investigations.
He says that it is common practice for Swiss authorities investigating economic crimes to offer plea bargains once they have enough evidence to charge suspects.
The January 1, 2011 Swiss Code of Criminal Prodecure (CCP) law allows the prosecutor to make a deal with the defendant. A confession leads to reduction of between one-third and one-fifth of the penalty.
Under the deals, Mr Pitteloud says, suspects are offered immunity from prosecution on condition that they hand over the irregularly acquired funds to the authorities.
“Of course you would like to punish the culprits, but the ultimate aim is to recover the money,” he said about the $55 million demand. “It is needed here for development. It is not in the best interest of all parties to have a court case drag on forever.”
He added that both Kenyan and Swiss authorities were aware of the offer he made to Mr Kamani.
Mr Pitteloud said he was playing the role of a postman and only conveyed a message to Mr Kamani. Extortion, he adds, could land him in jail for up to 20 years, which he sayid he would never risk.
“That would be my professional death, and if that is what he [Mr Kamani] is implying, it is preposterous,” Mr Pitteloud said. “In the end the procedure is long and will be a pain in the neck for everybody, so you try to get some justice by returning the funds to the victims.”
When contacted, however, Attorney-General Githu Muigai said he was not aware of any plan to offer Mr Kamani a plea bargain, adding that he could not rule out the possibility.
“At no time was the State Law office involved in any discussions between the Swiss Federal authorities and any suspect in the Anglo Leasing case,” said Prof Muigai.
He, however, said there were six other individuals, other than Mr Kamani, who are under investigation for involvement in the scandal.
Reports of a similar secret immunity deal between the government and Mr Kamlesh Pattni, the architect of the Goldenberg financial scandal, led to street protests and a political backlash when Mr Pattni surrendered a hotel property to the Central Bank of Kenya in 2008.
The Swiss envoy faulted Mr Kamani for going to court in an attempt to stop the Kenya-Switzerland co-operation, arguing that everything had been kept confidential until then.
“We were very careful not to mention any names. I told him what my justice system was telling me and they thought it would make sense to settle. I don’t see it as blackmail at all. This is a sideshow,” said Mr Pitteloud.
The ambassador said he saw nothing wrong with meeting Mr Kamani in his home, adding that the message he was sent with was what mattered.
“The ethical problems can only be with the messages you are sending,” the ambassador said. “As long as you deliver the message you have been sent with the full knowledge of the Swiss and Kenyan authorities, it is not a problem.”
Mr Pitteloud said he believes the files Prof Muigai handed over to Swiss authorities have been useful, adding that the investigators “do not seem to be unhappy so far”.
The documents were intended to help the investigators determine whether funds deposited in Swiss bank accounts were acquired by legally questionable means.
The investigations, he added, are likely to net not only Kenyans, but anyone who abetted the culprits, including Swiss nationals. While no arrests have been made so far, he declined to rule out the possibility of Swiss nationals being targeted in the case.
Mr Pitteloud said that Switzerland, which has records of bank transactions related to the Anglo-Leasing scandal, was keen on ending its reputation as a financial secrecy jurisdiction that turns a blind eye to money laundering.