alexa Tycoon sought over Sh2 billion saga - Daily Nation

Tycoon sought over Sh2 billion saga

Monday February 26 2001

By STEPHEN MUIRURI

and WAWERU MUGO

Tycoon Humphrey Kariuki has been summoned to CID Headquarters in Nairobi today to explain the source of the mysterious Sh2 billion in his account.

Anti-narcotics police chief Michael Jackobam yesterday said his detectives had in the past two days staked out Mr Kariuki's Kileleshwa residence and the Green Corner restaurant in the city centre. But have been unable to trace him.

Said Mr Jackobam: "We left a message that he must present himself at the offices of the anti-narcotics unit on Monday. We want him to explain the source of the Sh2 billion and to account for his wealth."

The tycoon is expected to record a statement declaring all his assets and liabilities. "We strongly believe that the Sh2 billion was proceeds of drug trafficking," Mr Jackobam added. "It is up to Mr Kariuki to prove us wrong by truthfully explaining how he acquired the money."

Mr Kariuki's statement will determine the direction the investigation will take, the officer said.

Last Thursday, anti-narcotics police froze Mr Kariuki's account at Charterhouse Bank in Nairobi and another of Sh300 million belonging to the tycoon's lawyer, Mr Kariuki Muigua.

Mr Jackobam said that these actions were within the law.

He said the Narcotic Drugs and Psychotropic Substances (Control) Act of 1994 gives his unit powers to interrogate and investigate any person they believe to have earned his wealth through drug trafficking or money laundering.

The Act gives the attorney-general sweeping powers to seize property or money until a case related to drugs is determined.

On Friday, Mr Kariuki broke his silence and vowed not to give up a cent of the controversial money. He views the State's attempt to control the Sh2 billion deposited at Charterhouse Bank as an extortion campaign. "I will not part with a single cent of the Sh2 billion!" Mr Kariuki told the Nation in his first Press interview since the case became public. "I'll fight to the end."

The Sh2 billion saga started on January 30 when the Central Bank froze Mr Kariuki's account at Charterhouse Bank, Nairobi, through a court order. The sudden huge deposit into Mr Kariuki's account had aroused the suspicion of bank fraud experts.

The court later allowed him to withdraw Sh300 million from the account.

Mr Kariuki maintained that the Central Bank of Kenya and the police had not told the public the full details of the case and promised to "drop the bombshell" in two weeks.

In an affidavit presented the day before to a Nairobi court, Supt Amos Tebeny of the Anti-Narcotics Unit said they were investigating a drugs offence.

The narcotics police are understood to be drafting an affidavit which the AG's office will use to oppose Mr Kariuki's bid to have the freeze lifted.

Officer Tebeny's affidavit said: "There are reasonable grounds to suspect that the money directly or indirectly represents the proceeds of drug trafficking."

"Kariuki has failed to provide proper explanation in the origin of the funds (Sh2 billion) and I have reasonable grounds to believe that the said money is proceeds of drug trafficking and is subject to an offence under the Act," he said.

If the AG is granted an order blocking Mr Kariuki's bid to have the freeze lifted, then the businessman, his lawyer and his two other other directors – Mr Gilbert Thinji Nguru and Ms Helen Njambi Nguru – will not operate the accounts until investigations into the alleged drug trafficking are over.

Should the narcotics police convince the court that the money was obtained through drug trafficking and have those involved found guilty by the court, the Sh2 billion will be forfeited to the State.

The Kenyan police have engaged Interpol and the Federal Bureau of Investigations to help establish the source of the money.

The narcotics police took over the case from the CBK's fraud detectives after detecting some anomalies by Mr Kariuki that the money was transferred to the account by Temuco Foundation, allegedly based in the United Sates.

An affidavit sworn by Supt Tebeny says investigations they had carried out with the help of the FBI showed the foundation did not exist in the US and the money originated from Europe.

Documents from Charterhouse indicate the foundation, whose address is given as 9490 Vaduz, sent the money through UBS Stamford CT of New York.