Ex-PS children’s bank cash frozen over NYS

Bank accounts belonging to former Public Service Principal Secretary (PS) Lillian Omollo and her children have been frozen on suspicion they were used as conduits for millions of shillings stolen at the National Youth Service.

Justice Hedwig Ong’udi, on Monday froze the 10 accounts with Sh33.1 million for 90 days under the money laundering law.

Investigators have been looking into how Ms Omollo made cash deposits of millions of shillings in the accounts in months when theft of funds was reported at the NYS.

“Preservation orders prohibiting the respondents or their agents from transferring, withdrawing, transacting, using and any other dealings in respect of the funds held in the following accounts,” said Justice Ong’udi.

Ms Omollo’s seven bank accounts had Sh20.6 million while that of her children — Sheela Mbogo, Stephanie Mbogo and Shalom Kamwetu — had Sh12.5 million.

The Asset Recovery Agency (ARA) had early revealed to the court that millions of shillings including a cash deposit of Sh20 million on April 20 were wired to the accounts registered to Sheela, Stephanie and Shalom.

The deposits were made in a period when more than Sh1 billion was stolen from the National Youth Service (NYS) through fictitious invoices for goods such as firewood and stationery and multiple payments on one supplier invoice.

Businesspeople and dozens of senior government officials including Ms Mbogo were charged in May with various crimes related to the theft marking a new effort to crack down on widespread corruption.

“All the accounts held at Diamond Trust Bank (DTB) are in names of the sons and daughters of Lilian Muthoni Mbogo,” said ARA in court documents where it was pushing for a freeze in the bank accounts.

“That on or about 20th day of April 2018 … the accounts received Sh20 million suspected to be proceeds or crime or money laundering from the NYS.”

Justice Ong’udi ordered that the accounts be frozen until end of January on the day when trails for the first batch of suspects linked to the reported theft of Sh468 million at the NYS started.

The revelation comes days after the Central Bank of Kenya (CBK) fined Standard Chartered Kenya, Equity, DTB, Co-operative Bank and KCB Group Sh392.5 million for failing to report suspicious transactions in connection with the theft of funds at the NYS.

The banks had received a total of more than Sh3 billion from the NYS on behalf of their customers, the CBK said.