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How civil servant bought Sh279m houses in days

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How civil servant bought Sh279m houses in days


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Kileleshwa Estate in Nairobi. FILE PHOTO | NMG

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Summary

  • Muthui bought 11 apartments in Kileleshwa for Sh264 million in cash between July and September 24, 2019.
  • She acquired another 12 units in a Ruaka flat in June 2019 for Sh15 million.

A deputy director at the Kenya Rural Roads Authority (KeRRA) bought the bulk of 35 apartments in the four months to September 2019 when Kenya withdrew the old Sh1,000 banknote to tackle illicit financial flows.

The Assets Recovery Agency (ARA) has raised the red flag that the apartments worth Sh374.5 million and Sh94 million in bank accounts linked to Margaret Wanja Muthui were the products of illicit deals, including kickbacks from road contractors.

The ARA successfully applied to court for freeze of the assets with the aim of forfeiting them to the State, arguing that her salary cannot support the purchase of the multimillion-shilling properties within weeks.

In a petition certified as urgent, the State agency says Ms Muthui bought 11 apartments in Kileleshwa for Sh264 million in cash between July and September 24, 2019.

She acquired another 12 units in a Ruaka flat in June 2019 for Sh15 million, days after the Central Bank of Kenya (CBK) set September 30, 2019 deadline for converting the old Sh1,000 note into new ones after it became the banknote of choice for criminals in the country.

Those exchanging large amounts were required to explain how they acquired the cash.The move was designed to stop the flow of proceeds of crime such as corruption and counterfeiting of banknotes through the financial sector.

Ms Muthui is said to have bought 23 apartments worth Sh279 million during the four months when the old bank notes were being retired and she paid cash for the properties, court filings show.

The cash deals were meant to conceal the money from the CBK, which said notes worth Sh7.4 billion were not exchanged, rendering the cash invalid and hitting the suspected corrupt owners hard.

The agency says Ms Muthui allegedly purchased the apartments herself or through proxies and a company whose directors were mostly her relatives or proxies. Documents filed in court showed that she had earlier in March 2019 acquired a flat with 12 units in Ruaka for Sh15 million.

Ms Muthui later acquired a house in Nairobi and land in Riruta, Dagoretti and registered them in the names of other persons to conceal the source of the funds.

On Tuesday, Justice James Wakiaga also allowed the freezing of Sh94 million held in several accounts at Co-operative Bank #ticker:COOP and registered under different persons, pending the determination of the petition.

Justice Wakiaga also ordered the chief lands registrar to register caveats against each of the Sh374.5 million apartments and home in a move aimed at stopping their transfer or sale.

The judge also ordered a preservation of rental income from all the apartments and the houses.

The rental income will be deposited at a KCB #ticker:KCB account belonging to the ARA, pending the determination of the case.

Ms Muthui, who is a deputy director in charge of supply chain management at KeRRA was transferred to the department of Infrastructure early this year.

She resisted the move and petitioned the High Court, which reversed the transfer, leaving her at the cash-rich KeRRA.

The ARA has named Ms Esther Wagio Njunge, Ms Muthui, Ms Grace Nyambura Ndiritu, Ms Mercy Wambui Nyambura and Cynthia Wanjiku Nyambura as well as Light House Trading Company Ltd as respondents in the case. The directors of the company are Ms Wagio and Ms Wacuka.

The funds frozen include Sh74.7 million held in fixed account at Co-op Bank in the name of Ms Wagio, Sh13.9 million in the name of Ms Muthui and Sh4.8 million at Co-op Bank in the name of Light House Trading Company.

Also frozen is a residential house in Nairobi, known as Collingham Gardens, which was purchased for Sh55 million on August 1, 2016.

Documents filed in court showed that the land in Dagoretti was purchased by Ms Wagio on December 18, 2020 for Sh25 million from Ms Rosemary Wanjiku Gathuku.

The agency said it was tipped that the respondents have acquired funds and assets through money laundering, and which is believed to be proceeds of crime.

The ARA then moved to court and was allowed to investigate the accounts. The 11 apartments in Kileleshwa were purchased in cash from Ceytun East Africa Ltd and registered in the names of the company, Ms Wagio, Ms Ndiritu and Ms Wanjiku.

The seller is a limited company incorporated in Turkey, known as Ceytun Insaat Sanayi Ve Ticaret and the developer of the property was Ceytun East Africa Ltd.

It was revealed that on July 28, 2019, Ms Muthui, accompanied by her lawyer, went to Ceytun East Africa offices at Signature Apartments in Kileleshwa and paid Necmi Karatas, the in-charge of the sales at the company, Sh20.5 million in cash for one apartment. The apartment draws a monthly income of Sh116,000.

She purchased a second apartment on August 21, 2019 for Sh22 million and according to the ARA, the house draws a monthly income of Sh170,000.

Ms Wacuka purchased another apartment for Sh25 million on September 24, 2019 and she gets a monthly rent of Sh250,000.

The petition said Ms Wagio, the company, Ms Ndiritu and Ms Wanjiku were used as conduits of money laundering by Ms Muthui, for purposes of concealing the source of the funds and beneficial ownership of the properties in question.

The ARA said the funds in the three accounts were deposited on diverse dates between 2015 and 2021 and the period of maturity is April 16, 2022.

The first deposit was made on April 13, 2015 when Ms Muthui transferred through RTGS Sh39 million from her account to Ms Wagio’s account.

On June 4, 2015, Ms Wagio transferred through RTGS Sh39 million from her account at Equity Bank to her account at Co-op Bank. The same account was to receive Sh3 million on June 8, the same year.

On July 26, 2017, the funds had accumulated interest and stood at Sh49.8 million and it is alleged that Ms Wagio transferred the money to another account in the same bank in a fixed deposit account.

On April 12, this year, Ms Muthui allegedly deposited Sh13 million in a fixed deposit account. “There are reasonable grounds to believe that the funds and assets in issue were unlawfully acquired, thus constitutes proceeds of crime liable for recovery pursuant to the provisions of Proceeds of Crime and Anti-Money Laundering Act,” the ARA said in the petition.

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KQ resumes Mumbai flights after 4 months

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KQ resumes Mumbai flights after 4 months


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A Kenya Airways aircraft at JKIA. FILE PHOTO | NMG

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Summary

  • Kenya Airways will on Thursday resume flights to Mumbai, ending a four-month hiatus that was occasioned by increased cases of Covid-19 in the Asian state.
  • The airline in a notice to its customers yesterday said it will resume its operations on the route on September 16, 2021 with the first flight departing Jomo Kenyatta International Airport at 7am to arrive in Mumbai at 3:45 pm.

Kenya Airways #ticker:KQ will on Thursday resume flights to Mumbai, ending a four-month hiatus that was occasioned by increased cases of Covid-19 in the Asian state.

The airline in a notice to its customers Monday said it will resume its operations on the route on September 16, 2021 with the first flight departing Jomo Kenyatta International Airport at 7am to arrive in Mumbai at 3:45 pm.

The airline will then resume full operations on the route on September 20, flying three times per week on the Indian route, which is one of the most lucrative destinations on its network.

Passengers on the route will part with Sh46,000 ($419) for one-way air ticket on economy class seats from Nairobi to Mumbai- prices that are relatively the same compared to what it was charging before the Covid-19 pandemic.

“Welcome back onboard! Fly from Nairobi to Mumbai starting Thursday 16th September with normal schedules resuming from Monday 20th September 2021,” said the airline in a notice to its customers yesterday.

KQ Suspended passenger flights to and from Mumbai on April 30 until further notice, following a government directive on travel between India and Kenya due to a Covid-19 crisis in that country.

The airline said on Friday that passengers who had booked tickets after May 1, the date of the last flight from Mumbai to Nairobi, will have to change their plans.

Affected passengers, KQ said, could also take vouchers for the value of their fare for future travel within 12 months.

India has seen soaring infection rates in the recent days, since the discovery of a new virus variant. Last month, India put on lockdown one of the states following a spike in cases of Covid-19.

Other countries that have banned flights to India include France, the UK Bangladesh, Oman and Hong Kong that have banned travel to and from India or asked their nationals coming from the Asian country to isolate themselves in government-approved hotels.

India has so far detected 33,264,175 corona virus cases with the number of deaths hitting 442,874 as at September 13.

A large number of patients from Kenya also travel to India every year for specialised medical treatment, especially cancer care, helping to drive medical tourism in the densely populated country that boasts affordable and easily accessible healthcare.

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Lower import volumes push mitumba prices to new highs

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Lower import volumes push mitumba prices to new highs


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Man pulls a cart loaded with second-hand clothes at Gikomba Market in Nairobi. FILE PHOTO | NMG

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Summary

  • Traders paid Sh100,527 on average per tonne of the used clothes, popularly called mitumba, compared to Sh96,286 the previous year.
  • Kenya Bureau of Standards (Kebs) banned importation of the clothes from late March through mid-August in a bid to contain the spread of the life-threatening coronavirus infections.
  • Findings of the Economic Survey 2021 suggests dealers shipped in 121,778 tonnes of mitumba in 2020, a 34.02 percent fall compared with 2019 and the lowest volumes since 2015.

The average price of a tonne of second-hand clothing items imported into the country crossed the Sh100,000 mark for the first time last year on reduced volumes in the wake of safety protocols and guidelines to curb spread of coronavirus.

Traders paid Sh100,527 on average per tonne of the used clothes, popularly called mitumba, compared to Sh96,286 the previous year.

Kenya Bureau of Standards (Kebs) banned importation of the clothes from late March through mid-August in a bid to contain the spread of the life-threatening coronavirus infections.

Findings of the Economic Survey 2021 suggests dealers shipped in 121,778 tonnes of mitumba in 2020, a 34.02 percent fall compared with 2019 and the lowest volumes since 2015.

Last year’s drop was the first dip since 2011 when 76,533 tonnes were shipped in compared with 80,423 tonnes the previous year, the official data collated by the Kenya National Bureau of Statistics (KNBS) shows.

The import bill for the merchandise amounted to Sh12.24 billion, a drop of 31.11 percent, or Sh5.53 billion, year-on-year.

TIn imposing the temporary ban on used clothes, Kebs had applied a standard which prohibits buying second-hand clothes from countries experiencing epidemics to ensure disease-causing microorganisms are not imported into Kenya.

Higher quality and relatively lower prices for mitumba has continued to drive demand for used clothes at expense of locally-made products amid higher margins enjoyed by traders largely operating in informal markets.

The lucrative second-hand clothing market has seen traders from China —a key source market for the merchandise —open shops in Gikomba, Kenya’s largest informal market for mitumba, in recent years to cash in rising demand.

Earnings from exports of articles of apparel and clothing accessories fell 5.32 percent to Sh32.92 billion last year compared with 2019, data indicates.

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Court backs Atwoli union in horticulture membership feud

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Court backs Atwoli union in horticulture membership feud


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Cotu boss Francis Atwoli. FILE PHOTO | NMG

Summary

  • A trade union that is led by the long-serving Central Organisation of Trade Unions (Cotu) boss Francis Atwoli has survived an attempt to stop it from representing over 60,000 workers in the horticulture industry.
  • Newly registered Kenya Export, Floriculture, Horticulture, and Allied Workers Union (Kefhau) had filed as a case in the Employment and Labour seeking to bar the Atwoli-led Kenya Plantation and Agricultural Workers Union (KPAWU) from representing workers in the industry.

A trade union that is led by the long-serving Central Organisation of Trade Unions (Cotu) boss Francis Atwoli has survived an attempt to stop it from representing over 60,000 workers in the horticulture industry.

Newly registered Kenya Export, Floriculture, Horticulture, and Allied Workers Union (Kefhau) had filed as a case in the Employment and Labour seeking to bar the Atwoli-led Kenya Plantation and Agricultural Workers Union (KPAWU) from representing workers in the industry.

Mr Atwoli is the secretary-general of KPAWU. The rival union claimed KPAWU had encroached on its area of workers’ representation.

Justice James Rika, however, dismissed the claim and ruled that the dispute should have been taken through conciliation, and was therefore presented in court prematurely.

He also stated that Kefhau must go beyond its registration and recruit sufficient members from the employers, to be granted recognition and organisational rights.

“Registration on its own, does not afford the claimant (Kefhau) recognition. Until there is proof that Kefhau has satisfied Section 54 of the Labour Relations Act, the status quo must be maintained,” said the judge.

“Kefhau must recruit at least 50 percent plus one, of the unionisable employees in the floriculture and horticulture industry, members of the Agricultural Employers Association to be considered for recognition,” he stated.

He noted that there is a Recognition Agreement and CBA, binding Mr Atwoli’s union and Agricultural Employers Association, affecting 73 Flower Growers Group of employers, and over 60,000 employees.

“It is objectionable for Kefhau to be allowed organisational rights, and the legitimacy to receive trade union dues and agency fees, from over 60,000 employees, just on the strength of registration as a trade union,” said the judge.

Kefhau wanted the court to declare that it is the sole trade union, which is allowed by its constitution to carry out activities in the export floriculture and vegetable industry, and an order restraining Mr Atwoli’s from representing workers in that area.

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