Business tycoon Humphrey Kariuki Ndegwa, the owner of Africa Spirits Limited who is facing a tax evasion investigation, has moved to court to challenge a law on the declaration of dual citizenship.
Detectives who questioned Mr Kariuki on the alleged evasion of taxes amounting to Sh3 billion were surprised by the realisation that he is a citizen of Cyprus.
The Nation exclusively learnt that he was questioned on the dual citizenship and on why he had not disclosed it as required by law.
The businessman took court action on Tuesday, his goal being the suspension of the section of the law that specifies a punishment for failure to disclose dual citizenship.
Mr Kariuki is challenging provisions of Section 8(4) of the Immigration Act which prescribes a fine of Sh5 million, three years' imprisonment, or both, if one fails to disclose this status within three months of acquiring it.
Mr Kariuki wants the law suspended and eventually declared unconstitutional, arguing it limits freedom of movement as guaranteed by the Constitution.
The billionaire also says this law provides no defence or exception if the stipulated time frame of three months elapses.
He further terms the punishment as stiff, arbitrary, oppressive and unjustifiable.
Mr Kariuki also argues that the law can affect a number of Kenyans who live, work, study or do business abroad and have acquired such citizenship by virtue of their long residency outside Kenya.
"It is disproportionate and excessive to punish Kenyans working abroad through conviction and stiff sentencing on account of an administrative issue of disclosure that can be achieved through less restrictive means," said his lawyer Benjamin Musyoki.
He adds that this law is discriminatory as it only targets Kenyans, not other foreign nationals.
The businessman defends himself saying he did not know he was supposed to disclose his dual citizenship within just three months.
He claims that as soon as he learnt about the disputed law, he filled a document known as Form 3 as required by the law. He says, however, that when he attempted to present it to the director of immigration services, he was threatened with imminent prosecution.
While noting that he did not endeavour to keep his dual citizenship a secret, he argues that he has travelled several times with his Cypriot passport, to and from Kenya, and that it has been stamped 19 times with no questions raised by immigration officials.
In case documents filed at the High Court on Tuesday, he insists that if there had been anything wrong, the relevant authorities should have notified him a long time ago.
While a Cypriot passport enables one to do business throughout the European Union, since Cyrus is a member, its investor citizenship has been criticised for creating a leeway for corrupt individuals, tax evasion and money laundering.
Bulgaria, Cyprus and Malta are the only countries within the EU that grant investors citizenship without the obligation of physical residence.
Cyprus has indicated that it intends to tighten its citizenship for the investment scheme, which will see tycoons pump in Sh282 million in exchange for passports.
Previously, investors parted with only Sh226 million to become Cypriots. If the changes are implemented, those interested will also be required to make two mandatory donations of €75,000 (KSh8,542,605) each.
Africa Spirits, which is based in Thika, was shutdown on February 8 after illegal ethanol and fake Kenya Revenue Authority stamps were found during an inspection.
During the raid, police seized an estimated 21 million counterfeit excise stamps and 312,000 litres of illicit products valued at Sh1.2 billion.
Later, the Kenya Revenue Authority obtained orders freezing 11 accounts associated with the businessman over the alleged evasion of taxes amounting to Sh3 billion.
The accounts are scattered in seven banks, including Equity, National Bank of Kenya and Kenya Commercial Bank (KCB), and are linked to three companies associated with Mr Kariuki.
While commenting on the investigation, Director of Criminal Investigations George Kinoti said they were not only concerned about Mr Kariuki's Cypriot passport — number K0627485, which was issued on May 19, 2016 and which he has not handed in - but also about four the Kenyan passports he has held.