Kenya Revenue Authority (KRA) cleared the Sh102 million sent to a 21-year-old Kenyan student by his Belgian boyfriend in August, money that is now subject to forfeiture by the Assets Recovery Agency (ARA).
Felesta Nyamathira Njoroge says in court filings that the taxman froze the money on August 18, about two weeks after her boyfriend — Marc De Mesel wired the millions to her accounts. The KRA cleared the money two weeks later.
The taxman froze the cash under section 43 of the Tax Procedures Act but upon conclusion of investigations, the student at Nairobi Technical Institute says, the accounts were unfrozen.
“Kenya Revenue Authority (KRA) returned a not guilty verdict and unfroze the account of the applicant on 30th September 2021,” her lawyer said in the submissions filed in court.
Ms Njoroge was, however, unlucky because immediately she thought of withdrawing the money for investment, the bank informed her that she could not operate the accounts until it was cleared by the legal department.
A few days later, the ARA, obtained an order freezing the accounts, pending the conclusion of investigations into the source of the funds.
Last month, Justice Esther Maina froze Sh102 million belonging to Ms Njoroge after the agency argued that the funds are believed to be part of a money-laundering scheme.
And last week, the court also froze a further 108.2 million sent by the Belgian to another student — Tebby Wambui Kago, bringing the total amount frozen to Sh213 million.
Justice Maina ordered the freezing of $631,071 (Sh71.2 million) at Equity Bank #ticker:EQTY and Sh37 million in the same bank in the name of Ms Kago and another Sh5 million at Stanbic bank #ticker:SBIC in Njoroge.
The Belgian had indicated in the declaration documents that Njoroge was “free to use the money to secure financial security for our future children”.
Documents filed in court indicate that Ms Kago is an associate of Ms Njoroge, with both receiving the Sh210 million in eight batches over two weeks.
In her submission, Ms Njoroge says she wanted to invest the funds in several projects and she has no business explaining to ARA how she met De Mesel. She says the bid by the ARA the get more details about their relationship was not only illegal but also immoral.
“It is undisputed fact that the applicant is a full-time student and the subject funds were meant for her upkeep and general investment for her current and future social and economic security,” he said.
The agency argued that investigations established that the suspect funds were received from the same source and distributed in the same manner, to various accounts belonging to the two women.
“The pattern of transaction in the accounts in issue and the activities of one De Mesel Marc and the Respondents depicts money laundering activities and this honourable court ought to issue the orders sought,” the agency said.
Ms Njoroge, however, says the application by ARA is speculative and against her economic rights and courts should not be used to assist agencies the agency to interfere with her rights.
“The respondent obtained sweeping and radical orders against me without making any material disclosure as to whether financial due process was not adhered to in the transfer of the funds to me,” she said.
The court directed the case to be mentioned on February 28.