Economy

Gethi’s mother loses bid for hotel seized in NYS scam

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Eden Times Restaurant on Tom Mboya Street in Nairobi. PHOTO | SALATON NJAU

Charity Wangui Gethi, the mother of one of the key suspects in the theft of Sh791 million from the National Youth Service (NYS), has lost the fight to reclaim a downtown hotel in Nairobi.

Ms Wangui, through her lawyer, reckons that the hotel is being run down and that bad publicity from the NYS scam has seen many customers desert the eatery. She wants the freeze order lifted.

High Court judge Hedwig Ong’udi of the Anti-Corruption and Economic Crimes Division ruled that the Asset Recovery Agency should continue holding on to the hotel while forensic investigations are ongoing.

Mr Justice Ong’udi said Ms Wangui had not proved that the seizure of the hotel had denied her reasonable living standards and caused hardship.

The restaurant — Eden Times Restaurant — located in Mercury Building on Tom Mboya Street was also identified for seizure on suspicion that it was funded by funds stolen from the NYS.

More than Sh1.8 billion was lost through fictitious contracts.

Adverse publicity

“That the appointment of a manager over her property had led to hardship and loss of her business in Eden Times Restaurant,” said Ms Wangui’s lawyer.

“It is her claim that she has lost and continues to lose business in the Eden Times Restaurant by reason of adverse publicity.” On November 25, 2015, the Asset Recovery Agency secured freezing property suspected to have been bought using proceeds from the NYS scandal.

The court in November 2015 issued the orders prohibiting transfer or disposal of the hotel. “That the hardship the applicant has suffered and will continue to suffer as result of the preservation order outweighs the risk that the property concerned may be destroyed, concealed or transferred,” said Ms Wangui’s lawyer. Other assets linked to the NYS scam and have been frozen by the State include three plots registered under Ms Wangui’s name in Muthaiga North in Nairobi and Thika.

Other properties seized under Ms Wangui’s name were a house in Rosslyn Estate valued at Sh63.5 million and a jeep valued at Sh6.3 million.

“After analysing the material before me, I find that the threshold set out in Section 89 of POCAMLA has not been met by the applicant to warrant the variation or rescinding of the orders issued by this court on November 25, 2015,” ruled Mr Justice Ong’undi.

“In the circumstances, I find no merit in the Application dated February 24, 2016 and dismiss it with costs.”