UK jails tycoon Ketan Somaia for 8 years

A co-architect of the Goldenberg scandal, Ketan Somaia, was on Wednesday jailed for eight years in the UK.

A British court found the 52-year-old tycoon guilty of swindling investors of £13.5 million (Sh2 billion), the Daily Mail reported.

Somaia was convicted of swindling two businessmen in 1999 and 2000 in what was described as the largest private prosecution in Britain.

The court heard that Somaia never invested the money or repaid it, but used it for his own purposes or to save his ailing business empire.

It further heard that Somaia exhibited similar dishonest behaviour towards a third investor and tried to evade justice until he was brought to account in a British court.

Last month, a jury found Somaia guilty of nine counts of obtaining money transfers through deceit. He was cleared of another two counts.

The tabloid quoted Judge Richard Hone describing Somaia as “fundamentally dishonest” in his dealings with the two investors, Mr Murli Mirchandani and Mr Dilip Shah.

(READ: Somaia guilty over Sh1.6bn fraud)

“It is apparent your Dolphin group of companies was in serious trouble in the economic downturn of 1999,” the judge said. “Loans you took were never invested as you said they would be, they were used for your own purposes or to prop up your business.

“Not one of the loans was repaid in part. Not one single deal came to fruition.”

'KING CON'

According to the report, Somaia wooed his victims with champagne parties, extravagant dinners and trips on private Lear jets to Dubai, Kenya and South Africa.

Dubbed “King Con”, he boasted about ties to the billionaire Hinduja brothers while showing off a plush office in Mayfair and a palatial home in the exclusive north London suburb of Hadley Wood.

“In reality Somaia was shamelessly exploiting his unwitting victims to get his hands on their money to sustain his luxurious lifestyle and prop up his failing businesses,” the paper reported.

Somaia is best remembered for his role in the Goldenberg scandal where he presided over the collapse of Delphis Bank, one of the financial institutions linked to the multi-billion-shilling scam.

The scandal centred around a company called Goldenberg International, which claimed to be selling Kenyan gold and diamonds abroad.

To encourage exports, the government paid Goldenberg bonuses for the sales even though Kenya has no diamond deposits and produces only a tiny amount of gold. Large payments associated with the scam were said to have passed through Delphis Bank.

Somaia was jailed in 2004 but the conviction was quashed the following year.