Asset Recovery Agency v Maina; Mesel (Interested Party) [2023] KEHC 24704 (KLR) | Asset Forfeiture | Esheria

Asset Recovery Agency v Maina; Mesel (Interested Party) [2023] KEHC 24704 (KLR)

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Asset Recovery Agency v Maina; Mesel (Interested Party) (Civil Application E019 of 2022) [2023] KEHC 24704 (KLR) (Anti-Corruption and Economic Crimes) (2 November 2023) (Judgment)

Neutral citation: [2023] KEHC 24704 (KLR)

Republic of Kenya

In the High Court at Nairobi (Milimani Law Courts)

Anti-Corruption and Economic Crimes

Civil Application E019 of 2022

EN Maina, J

November 2, 2023

Between

Asset Recovery Agency

Applicant

and

Timothy Waigwa Maina

Respondent

and

Marc Freddy De Mesel

Interested Party

The Asset Recovery Agency is not required to prove the commission of a specific offence in regard to the funds before conducting civil forfeiture under the Proceeds of Crime and Anti-Money Laundering Act.

In the absence of evidence of a legitimate source of income, the Asset Recovery Agency was entitled to seize such funds and the court was entitled to conclude that seized funds are proceeds of crime, hence liable for forfeiture.

Reported by John Ribia

Anti-Corruption and Economic Crimes– asset recovery – asset recovery proceedings – forfeiture proceedings – civil vis-à-vis criminal forfeiture proceedings - whether forfeiture proceedings under the Proceeds of Corruption and Anti Money Laundering Act were civil or quasi criminal in nature -– whether the Asset Recovery Agency was required to prove the commission of a specific offence in regard to the funds for the purposes of civil forfeiture under the Proceeds of Crime and Anti-Money Laundering Act - whether the Asset Recovery Agency had the jurisdiction to seize large cash deposits in a Kenyan Bank Account on grounds that the source of the funds was of a suspicious nature - Proceeds of Crime And Anti-Money Laundering Act (cap 59A) section 2, 3, 4, 16, 53A(5), 81, 83, 90, 92, and 94. Law of Evidence– burden of proof – burden of proof in asset recovery and forfeiture proceedings under Proceeds of Corruption and Anti Money Laundering Act - who bore the burden of proof to prove the legality/legitimacy of seized goods in forfeiture proceedings under the Proceeds of Corruption and Anti Money Laundering Act - under what circumstances did the burden of proof of in forfeiture proceedings under the Proceeds of Corruption and Anti Money Laundering Act shift to a person who had their funds seized by the Asset Recovery Agency - whether in the absence of evidence of a legitimate source of income, the court was entitled to conclude that seized funds were proceeds of crime, hence liable for forfeiture - whether the standard of proof in forfeiture proceedings was on a balance of probabilities or beyond reasonable doubt - Evidence Act (Cap 80) section 35, 112, and 180.

Brief facts The applicant obtained search warrants to investigate the respondents bank account number xxxx held at Stanbic Bank. The applicant, the respondent was suspected to be part of a syndicate involved in a complex money laundering scheme involving a Belgian National Marc Freddy H De Mesel (interested party) in which the respondent received 370,990 Euros in one transaction in his bank account number xxxx held at Standard Chartered Bank; drawn from various jurisdictions including Belgium, on the pretence that the fund was a gift made in favour of the respondent.The crux of the applicant’s case was that the interested party had recruited the respondent (Timothy Waigwa Maina), and four others who it names as: Jane Wangui Kago, Serah Wambui Kamanda, Tebby Wambuku Kago and Timothy Waigwa Kiwanja. The named persons were all related to the respondent. They were recruited into a complex scheme of money laundering; that the deposit of large amounts of money into the respondent’s accounts was a money laundering scheme; thus, the funds were proceeds of crime.The explanation offered by the respondent, who together with the plaintiff were the principal parties in the instant case, was that the large deposits are gifts and loans, from the interested party to him. He did not however, proffer any sufficient explanation on the source of the funds preferring instead to leave that to the interested party.The interested party’s explanation was that the money came from a legitimate source; that he acquired the same from trading in stocks and bitcoins through a firm, in his home country Belgium, known as Interactive Brokers LLC, from the sale of his shares of LPG in 2021. Also, that the money was gotten from an inherited estate, that was sold and from other investments was used to purchase TSLA shares. That he had no criminal record; that he was an astute bitcoin trader of good repute as evidenced by the documents which he has annexed; and that the respondent was his personal assistant to whom he had advanced a loan to enable him get a golden visa in Portugal and invest, while at the same time the monies were a gift to him.

Issues

Whether the Asset Recovery Agency was required to prove the commission of a specific offence in regard to the funds before conducting civil forfeiture under the Proceeds of Crime and Anti-Money Laundering Act.

Whether the Asset Recovery Agency had the jurisdiction to seize large cash deposits in a Kenyan Bank Account on grounds that the source of the funds was of a suspicious nature.

Whether forfeiture proceedings under the Proceeds of Corruption and Anti Money Laundering Act were civil or quasi criminal in nature.

Whether the standard of proof in forfeiture proceedings was on a balance of probabilities or beyond reasonable doubt.

Who bore the burden of proof to prove the legality/legitimacy of seized goods in forfeiture proceedings under the Proceeds of Corruption and Anti Money Laundering Act?

Under what circumstances did the burden of proof of in forfeiture proceedings under the Proceeds of Corruption and Anti Money Laundering Act shift to a person who had their funds seized by the Asset Recovery Agency?

Whether in the absence of evidence of a legitimate source of income, the court was entitled to conclude that seized funds were proceeds of crime, hence liable for forfeiture.

Relevant provisions of the Law Proceeds of Crime and Anti-Money Laundering Act (Cap 59A)Sections 90 and 92. 90.  Application for forfeiture order(1)        If a preservation order is in force, the Agency Director may apply to the High Court for an order forfeiting to the Government all or any of the property that is subject to the preservation order.(2)        The Agency Director shall give fourteen days’ notice of an application under subsection (1) to every person who served notice in terms of section 83(3).(3)       A notice under subsection (2) shall be served in accordance with the provisions of the Civil Procedure Act (Cap. 21).(4)       A person who served notice under section 83(3) may appear at the hearing of the application under subsection (1) to—(a) oppose the making of the order; or(b) apply for an order—(i)        excluding his interest in that property from the operation of the order; or(ii)        varying the operation of the order in respect of that property, and may adduce evidence at the hearing of the application.92.  Making of forfeiture order(1)       The High Court shall, subject to section 94, make an order applied for under section 90(1) if it finds on a balance of probabilities that the property concerned—(a) has been used or is intended for use in the commission of an offence; or(b) is proceeds of crime.(2)       The Court may, when it makes a forfeiture order or at any time thereafter, make any ancillary orders that it considers appropriate, including orders for and with respect to facilitating the transfer to the Government of property forfeited to it under such an order.(3)       The absence of a person whose interest in property may be affected by a forfeiture order does not prevent the Court from making the order.(4)       The validity of an order under subsection (1) is not affected by the outcome of criminal proceedings, or of an investigation with a view to institute such proceedings, in respect of an offence with which the property concerned is in some way associated.(5)       The Registrar of the High Court making a forfeiture order shall publish a notice thereof in the Gazette as soon as practicable but not more than thirty days after the order is made.(6)  A forfeiture order shall not take effect—(a)       before the period allowed for an application under section 89 or an appeal under section 96 has expired; or(b)       before such an application or appeal has been disposed of.Evidence Act (Cap 80)112.      Proof of special knowledge in civil proceedings.In civil proceedings, when any fact is especially within the knowledge of any party to those proceedings, the burden of proving or disproving that fact is upon him.

Held

The term “proceeds of crime” was defined under section 2 of the Proceeds of Crime and Anti Money Laundering Act (POCAMLA) any property or economic advantage derived or realized, directly or indirectly, as a result of or in connection with an offence irrespective of the identity of the offender and included, on a proportional basis, property into which any property derived or realized directly from the offence was later successively converted, transformed or intermingled, as well as income, capital or other economic gains or benefits derived or realized from such property from the time the offence was committed.

The burden of proof lay upon the Applicant to prove on a balance of probabilities that the impugned funds were proceeds of crime. However, once that burden was discharged the evidential burden shifts to the respondent to prove that the funds were lawfully acquired, and were not proceeds of crime. Even though the proceedings were quasi-criminal in nature, there was an evidential burden of proof on the Respondent. It was incumbent upon them to demonstrate evidentially how they lawfully came into possession of the assets seized.

Under section 92(4) of the POCAMLA the applicant needed not to prove the commission of a specific offence in regard to the funds. Forfeiture proceedings were civil in nature and that was why the standard of proof was on a balance of probabilities. In civil proceedings for recovery under part 5 of POCAMLA the Director needed not allege the commission of any specific criminal offence but must set out the matters that are alleged to constitute the particular kind or kinds of unlawful conduct by or in return for which the property was obtained.

The respondent, who at all times material to the proceedings was a student and had indicated to be in the construction and real estate industry with an income range of Kshs. 150,001- 400,000, received large amounts of cash in his bank accounts at Standard Chartered Bank, including the impugned monies. The fact that he did not have an established a source of income from which he could have earned this kind of money, and which facts were not disputed would certainly require an explanation from him as to the source of the huge deposits. That was especially so because financial institutions bore an obligation under section 44 of the POCAMLA to report any cash deposit above Kshs. 1 million to the Financial Reporting Centre established under section 21 of POCAMLA, as part of its efforts to stem money laundering and other offences.

The huge cash deposits were suspicious in the circumstances and the evidential burden therefore properly shifted to the respondent to prove not only the source of the funds, but that the source of funds was a legitimate one.

The legal burden of proof remained with the plaintiff throughout the proceedings, and it was only once that burden was discharged on a balance of probabilities that the evidential burden shifted to the defendant.

The legal burden of proof remains with the plaintiff throughout the proceedings, and it is only once that burden is discharged on a balance of probabilities that the evidential burden shifts to the Defendant.

There was nothing untoward with a man gifting money or advancing a loan. None of the documents by the interested party demonstrated that the monies were from a legitimate source. The documents from Interactive Brokers LLC did not demonstrate how the funds, the subject of the case and which were deposited by the interested party into the respondent’s account were acquired. Whereas Interactive Brokers may be a reputable firm and the document shows that the interested party maintained an account with the Brokerage there was no sufficient and credible evidence of the source of funds by which the interested party traded through the firm. The seed money was what was in issue.

The onus was on the interested party to explain the source of the funds, how he invested it and how it was that it grew so exponentially that he could dole out such huge sums of money to the respondent and his relatives with no consideration at all.

The interested party deposed that the money he used to purchase the TSLA shares accrued from previous investments and more so from an inherited estate that he sold. He adduced evidence of the inheritance in an annexure. The annexure was a statement made in English by one Mr. Freddy De Messel in regard to the estate of Mrs. Martin Olivier, deceased, of who the interested party was named as one of her children. It contained a long inventory of property that belonged to the deceased and which were to devolve to Mr. Freddy De Messel on behalf of the interested party and his siblings. Thereafter there were documents which seemed to suggest that some funds were transferred to De Messel Marco and some other persons however some of the documents did not have a translation and that court could not understand them. It was not very clear that the transfers were from the inheritance and indeed there was no evidence at all that the interested party received any monies from the sale of property acquired from an inheritance. There was no document in the official language of this court to indicate the properties bequeathed to him which he could have sold as alleged. The court was unable to find that the seed capital accrued from an inheritance as alleged. The interested party had therefore not discharged the evidential burden placed upon him by section 112 of the Evidence Act.

Although the interested party deposed that he had many different portfolios, and he attempted to show how he made the money, he did not avail any cogent evidence of the said portfolio/source to satisfactorily demonstrate how he raised the money from the same. The interested party, apart from alluding to the credibility of the brokerage firm through which he allegedly traded, and the claimed inheritance, he had not sufficiently demonstrated the source of the funds, the subject of that trade as would be required of him under

The fact that the interested party had no criminal record from his home country and from Kenya was of no probative value as civil forfeiture was not dependent on criminal culpability. In the absence of evidence of a legitimate source, the court was entitled to conclude that the funds were proceeds of crime, hence liable for forfeiture. It was immaterial that other similar suits had been withdrawn by the plaintiff. It is my finding that purporting that the money was a loan/gift was just but a means of concealing that the deposit was but a way of laundering the funds.

The huge size of the deposits, and the fact that the interested party was also depositing similar accounts of the respondent’s relatives’ accounts, ought reasonably to have aroused the respondent’s suspicion that something was amiss. He nevertheless, went ahead and agreed to his account being used as a conduit to conceal those funds. The circumstances of the case made it clear that the respondent was being used to launder the money. That was a crime under section 3 of the POCAMLA and he was not entitled to benefit from the tainted funds.

Application allowed.

Orders

The funds: USD 390,038. 72 held in Account Number xxxx at Stanbic Bank in the name of Timothy Waigwa Maina, were be forfeited to the State.

The respondent and the interested party shall therefore bear the costs of the proceedings.

Citations Cases Abdulrahman Mahmoud Sheikh & 66 others y Republic & others (Miscellaneous Criminal Application 62 of 2015; [2016] KEHC 2604 (KLR)) — Followed

Asset Recovery Agency v Bala (Anti-Corruption and Economic Crimes Civil Suit E005 of 2021; [2022] KEHC 11829 (KLR)) — Followed

Assets Recovery Agency v Lilian Wanja Muthoni Mbogo t/a Sahara Consultants, Lidi Holdings Limited, Lidi Estates Limited, Stephanie Marigu Mbogo, Sheela Wangari Mbogo & Shalom Malaika Kamweti (Civil Application 58 of 2018; [2020] KEHC 4543 (KLR)) — Followed

Assets Recovery Agency v Njoroge; Mesel (Interested Party) (Civil Application E006 of 2022; [2023] KEHC 17943 (KLR)) — Followed

Assets Recovery Agency v Pamela Aboo;Ethics & Anti Corruption Commission (Interested Party) (Anti-Corruption and Economic Crimes Case 73 of 2017; [2018] KEHC 1845 (KLR)) — Followed

Assets Recovery Agency v Quorandum Limited & another; Duchess Park Development Company Limited (Interested Party) (Miscellaneous Application 4 of 2018; [2018] KEHC 1060 (KLR)) — Followed

Ethic and Anti-Corruption Comission v Jimmy Mutuku Kiamba (Miscellaneous Civil Application 804 of 2014; [2015] KEHC 1496 (KLR)) — Followed

Independent Electoral and Boundaries Commission (IEBC) v National Super Alliance(NASA) Kenya, Al Ghurair Printing and Publishing Llc, Attorney General, Jubilee Party, Ekuru Aukot &Thirdwayalliance;, Samuel Waweru & Stephen Owoko Oganga (Civil Appeal 224 of 2017; [2017] KECA 436 (KLR)) — Followed

Kenya Anti-Corruption Commission v Stanely Mombo Amuti (Anti-Corruption and Economic Crimes Case 5 of 2016; [2017] KEHC 1050 (KLR)) — Followed

Schabir Shaik & Others v State (Case CCT 86/06(2008) ZACC7 case) — Applied

Revision of People v Laito ((Appeal No.291/2014) [2015] ZMSC 26 (1 June2015)) — Followed

ARA & Others v Audrene Samantha Rowe & Others (Civil Division claim No 2012 HCV 02120) — Followed

Assets Recovery Agency v Fisher, Rohan and Miller, Delores (Claim No 2007 HCV003259) — Followed

Director of Assets Recovery and Others Republic v Green & Others ([2005] EWHC 3168) — Followed

Miller v Minister of Pensions ((1947) 2 ALL ER 372) — Followed

National Crime Agency v Mrs. A ([2018] EWH 2534) — Followed

Statutes Civil Procedure Rules (cap 21 Sub Leg) — order 51 rule 1 — Interpreted

Constitution of Kenya — article 27; 40(6) — Cited

Criminal Procedure Code Act (cap 75) — section 118, 118A, 119, 121(1) — Interpreted

Evidence Act (cap 80) — section 35; 112; 180 — Interpreted

National Police Service Act (cap 84) — section 24 (1)(e) — Interpreted

Proceeds of Crime And Anti-Money Laundering Act (cap 59A) — section 2; 3; 4; 16; 53A (5); 81; 83; 90; 92; 94 — Interpreted

AdvocatesNone mentioned

Judgment

1. Before this court is an originating motion dated 23rd May, 2022 brought under sections 81, 90 and 92 of the Proceeds of Crime and Anti-Money Laundering Act (herein after referred to as POCAMLA) and order 51 rule 1 of the Civil Procedure Rules. The Applicant is seeking for orders: -1. Thatthis honourable court be pleased to declare funds held in the following bank account as proceeds of crime and therefore liable for forfeiture to the Government of Kenya; USD 390,038. 72 held in Account Numberxxxx at Stanbic Bankin the name of Timothy Waigwa Maina.2. Thatthis honourable court be pleased to issue an order of forfeiture of the following funds to the Government of Kenya. USD 390,038. 72 held in Account Numberxxxx at Stanbic Bankin the name of Timothy Waigwa Maina.3. Thatthe honourable court do make any other ancillary orders it may deem fit and necessary for the proper and effective execution of its orders.

2. The application is accompanied by a supporting affidavit similarly dated, and deponed by Senior Sergeant Fredrick Musyoki, a police officer in-charge of investigations working for the applicant. The application is based on the grounds on the face of it, on the supporting affidavit; and on the supplementary affidavit dated 12th May, 2022.

Applicant’s Case 3. It is the applicant’s case that pursuant to sections 118, 118A, 119 and 121(1) of the Criminal Procedure Code; section 180 of the Evidence Act; section 24 (1)(e) of the National Police Service Act and section 53A (5) of the Proceeds of Crime and Anti-Money Laundering Act: On 3rd January, 2022 the Applicant obtained search warrants to investigate the respondents bank account number xxxx held at Stanbic Bank vide Miscellaneous Criminal Application No. E012 of 2022, Assets Recovery Agency v Stanbic Bank.

4. And pursuant to the same provisions, as herein above stated, on 22nd November, 2021 (the applicant) obtained search warrants to investigate inter-alia the respondent's bank account number xxxx held at Standard Chartered Bank vide Miscellaneous Criminal Application No. E4065 of 2022, Assets Recovery Agency v Stanbic Bank.

5. The applicant states that it (Assets Recovery Agency) is established under section 53 of the Proceeds of Crime and Anti-Money Laundering Act (POCAMLA) as a body corporate with the mandate of identifying, tracing, freezing, and recovering proceeds of crime. That pursuant to Part VIII of POCAMLA, sections 81-92, the it is authorized to institute civil forfeiture proceedings, and seek orders prohibiting any person, subject to such conditions as the court may specify, from dealing in any manner with any property if there are reasonable grounds to believe that such property is a proceed of crime.

6. The applicant avers that section 53A (5) of the POCAMLA grants its’ staff all the powers, privileges, and immunities of a police officer while executing its mandate in the identification, tracing, seizure, and recovery of proceeds of crime.

7. It is the applicant’s case that the respondent is a Kenyan adult citizen, holder of a national identification card no. xxxx the sole signatory, and beneficial owner of bank account number xxxx held at Stanbic Bank.

8. As per the applicant, it [Assets Recovery Agency] received information into a suspected case of money laundering schemes, and proceeds of crime involving multiple money transactions from foreign jurisdiction, whose source could not legitimately be established involving the respondent.

9. To the applicant, the respondent is suspected to be part of a syndicate involved in a complex money laundering scheme involving a Belgian National Marc Freddy H De Mesel (interested party) in which the Respondent received 370,990 Euros in one transaction on 6th April, 2021‑in his bank account number xxxx held at Standard Chartered Bank; drawn from various jurisdictions including Belgium, on the pretence that the fund is a gift made in favour of the respondent. That the bank account has since been closed.

10. Further, the applicant contends that the respondent on receiving 370,990. 00 Euros in his Standard Chartered Bank Account number xxxx; transferred 350,154. 17 Euros on 09-xxxxxx to his bank account number xxxx held at Stanbic Bank.

11. According to the Applicant, their investigations established that the respondent was engaged in, and was part of, a money laundering scheme which was designed and executed to conceal, disguise the nature, source, disposition, and movement of the illicit funds; suspected to constitute proceeds of crime and which are the subject matter of this application.

12. Subsequently, that on 2nd March, 2022 the applicant filed HCACEC Misc. No. E007 of 2022 Assets Recovery Agency v Timothy Waigwa Maina and obtained court orders preserving funds in the said accounts, and orders prohibiting the respondent their employees, agents, servants, or any other person acting on their behalf, from transacting, transferring and/or dealing in any manner with the funds held in the bank accounts. That the preservation order was gazetted by the applicant on 11th March, 2022 vide Gazette Notice No. 2714 of vol. CXXIV-No.44 pursuant to section 83 of the POCAMLA.

13. The Applicant maintains that there are reasonable grounds and evidence demonstrating that the funds, held by the respondent in the specified bank account, are direct or indirect benefits, profits, and/or proceeds of crime obtained from a complex money laundering scheme and are thus liable to be forfeited to the State under the provisions of Proceeds of Crime and Anti-Money Laundering Act, 2009 (POCAMLA).

14. To the applicant, unless this honourable court grants the orders sought, the respondent shall illegitimately enjoy the economic advantage derived from the commission of crimes, acquisition of proceeds of crime, or profits and benefits of crime contrary to the provisions of the Proceeds of Crime and Anti-Money Laundering Act, and the general public interest. Therefore, that it is in the public interest the orders sought be granted [and the suspect funds in the aforementioned account be forfeited to the applicant on behalf of the State].

15. Further, it is deponed that the interested party (Marc De Mesel) is the mastermind executing a complex money laundering scheme, with individuals drawn from foreign jurisdictions including Belgium on the pretence that the funds are gifts.

16. It is deponed that the interested party (Marc De Mesel) is a person of interest and is believed to be laundering illicit funds; currently under investigations for money laundering schemes/activity having sent funds to other individuals. That investigations have established between the month of February, 2020 and August, 2021 the interested party (Marc De Mesel) has transferred funds to five (5) individuals in Kenya, including the respondent, in the approximate sum of USD 6,141,463. 43, an equivalent of Kshs. 650,995,123. 25.

17. The other four (4) of the five (5) individuals include: Jane Wangui Kago, Serah Wambui Kamanda, Tebby Wambuku Kago and Timothy Waigwa Kiwanja all of whom received funds directly or indirectly from the interested party (Marc De Mesel); the purpose of the funds transfer was declared as gifts.

18. Accordingly, that Jane Wangui Kago is a person of interest and the applicant has frozen her accounts vide High Court ACEC Miscellaneous Application No. E047 of 2021 in the sum of Euro 355,990. 13 and Kshs. 3,111,800. And, that she (Jane Wangui Kago) recorded a statement at the applicant's offices on 17th August, 2021 in an attempt to explain the source of funds.

19. In similar manner, that also Tebby Wambuku Kago is a person of interest and the applicant has frozen her accounts vide High Court ACEC Miscellaneous Application No. E043 of 2021 in the sum of USD 631,071. 67 and Kshs. 37,000,000. And, that she (Tebby Wambuku Kago) recorded a statement at the Applicant's offices on 17th August, 2021 in an attempt to explain the source of funds.

20. According to the deponent, investigations have established that the interested party (Marc De Mesel) recruits/targets/exploits young persons aged 19-26 years‑such as the respondent, Tebby Wambuku Kago, and Jane Wangui Kago who are jobless‑to execute the money laundering scheme.

21. Hence, that there are reasonable grounds to believe that the respondent's bank account was used as conduits of money laundering contrary to sections 3, 4, and 7 as read together with section 16 of the Proceeds of Crime and Anti-Money Laundering Act (POCAMLA) in an effort to conceal and disguise the nature, source, disposition, or movement of the illicit funds.

22. Notably, that section 90 of the POCAMLA provides that where a preservation order is in force, the Agency may apply to the High Court for an order of forfeiture to the Government all or any of the property that is subject to the preservation order. Further, as per section 92 of the POCAMLA, the High Court shall, subject to section 94, make an order applied for under section 90(1), if it finds on a balance of probabilities that the property concerned is a proceed of crime.

23. Consequently, the applicant presents that unless this honourable court grants the orders sought, the respondent shall continue enjoy the economic advantage derived from the proceeds of commission of crimes, to the disadvantage of the economy and to the public; whilst dealing a big blow to the financial investigations.

Applicant’s Rejoinder to Replying Affidavits 24. In rejoinder to the replying affidavits [by the respondent dated 27th September, 2022; and by the interested party dated 18th April, 2023] the applicant filed a further affidavit dated 12th May, 2023. The applicant avers, as to the respondent, that he (respondent) in his account opening documents had voluntarily declared that he is in the construction and real estate industry with an income range of Ksh. 150,001-400,000. Also, that the respondent has a tax liability of Kshs. 16,560,589 which is due to the Kenya Revenue Authority; having accrued from 2018-2021.

25. As per the applicant, the authenticity of the loan agreement dated 3rd March, 2021 is suspect as they (Respondent and the interested party) have not produced a certificate of translation of the said agreement. That further the suspicion as to the authenticity of the agreement, can be discerned from the part where the respondent's passport number is captured as CK57xxx issued on 17. 03. 2021 and valid until 16. 03. 2021 and as such the Respondent had no valid passport to enable him travel to Portugal.

26. As to the interested party, the applicant avers that the interested party was aware of the investigations in respect to the respondent and opted to flee, rather than visit the applicant's offices to explain the source, purpose, and circumstances under which he (interested party) sent the funds to the respondent and four (4) other individuals.

27. That the interested party was not a party to the alleged proceedings against the other recipient of the funds he transferred to them. The applicant states that each case is unique to its peculiar circumstance, and the Interested Party ought to address the issues raised in the instant Application.

28. The applicant claims that [vide the averments of paragraph 13 of the interested party’s affidavit, and the averment at paragraph 11 of the respondent's replying affidavit] the deponents (respondent, and interested party) claim "it is a loan"; while their advocate’s letter dated 9th April, 2021 claims "it is a gift". Thus they (respondent and interested party) have perjured themselves on oath.

29. As such, that the respondent, interested party and their advocate are uncertain whether the funds was a gift or a loan and this discrepancy by itself on a balance of probabilities constitutes reasonable grounds to believe the funds are proceeds of crime.

30. To the applicant, the interested party has not demonstrated the legitimacy of the investment into Interactive Brokers, as he has only demonstrated the funds received in the Respondent’s bank account was from Interactive Brokers, but not the legitimacy of the funds invested in the brokerage firm.

31. That the interested party only alleges to have invested in inter-alia Bitcoin and Tesla and relies on articles of interviews written by Joel Valenzuela. That the articles relied upon by the Interested party lacks evidentiary probative value; constitutes hearsay evidence, and are thus inadmissible as per the dictates of section 35 of the Evidence Act.

32. It is stated that the Central Bank of Kenya issued a circular No. 14 of 2015 dated 18th December, 2015 in which it cautioned all financial institutions against dealing in virtual currencies or transacting with entities that are engaged in virtual currencies. The circular further advised financial institutions not to open accounts for any person dealing in virtual currencies such as Bitcoin.

33. Also, that the circular highlighted the risks associated with buying, holding, or trading in virtual currencies to include inter-alia; transactions in virtual currencies, such as bitcoin, are largely untraceable and anonymous making them susceptible to abuse by criminals in money laundering and financing of terrorism.

34. The applicant claims that the interested party, in an attempt to circumvent the Central Bank of Kenya circular No. 14 of 2015, identified five (5) proxies to whom he sent an approximate total sum of USD 6,141,463. 43 including to the Respondent.

35. It is further claimed that the interested party, admits to the relationship he has with the beneficiaries of the funds, and that it is this relationship that the Interested Party exploited to exercise control, as the beneficial owner of the funds in Respondent's bank account, to circumvent the Central Bank of Kenya circular No. 14 of 2015.

36. It is maintained by the applicant that they have established, on a balance of probabilities, that the funds held in the name of the respondent, the subject matter of the forfeiture application, are proceeds of crime.

Respondent’s Case 37. Responding to, and opposing the application, the respondent filed a replying affidavit dated 27th September, 2022 wherein he conceded to being the holder of the subject bank account (xxxx at Stanbic Bank). And, that the Applicant had not filed any application for preservation of funds, and also have not been served with the instant application.

38. As per the respondent, the applicant has not carried out sufficient and conclusive investigation to justify the issuance of the orders sought as there is no evidence adduced to support its allegation, no reasonable grounds presented that the money subject matter of this proceedings was acquired through a money laundering scheme or crime and that there are no reports showing the evidence of money laundering and/or economic crime committed by either the respondent or the person who sent the money. That the only true source of information they are likely to use is from Interpol, but none is presented.

39. The respondent avers that section 92(1) of the Proceeds of Crime and Money Laundering Act of 2009 places the applicant with the onus of establishing, on a balance of probability, that the property to be forfeited has been used, or is intended to be used in the commission of an offence and/or is proceeds of crime; which the applicant has failed to establish. That mere suspicions are not enough to warrant preservation or forfeiture orders; and relied on the case of EACC v Jimmy Mutuku Kiamba Misc/Civil Application No. 804 of 2014, as was similarly observed.

40. The respondent maintains that the amount remitted by the interested party (Marc De Mesel) who is his friend, and whom he (respondent) works for as a personal assistance, was a loan to help him secure a golden Visa from Portugal and invest. Also, the respondent stated that he is a crypto-trader, and has honed his skill in this area. Thus, he transferred funds out of his account so that he can increase his crypto-trading, which trading is not an outlawed activity.

41. The respondent states that the applicant cannot produce a document they have not made, and hence prays that the same be expunged from the court record; And that the applicant refused to give the respondent a copy of his own statement.

42. That the applicant has not produced any document from Belgium, interested party’s (Marc De Mesel)'s home country, or any other foreign jurisdiction, or from Kenya showing that the interested party is the head of any global syndicate as alluded to.

43. It is contended by the respondent that this matter being of civil proceedings the one who alleges must prove, but that the applicant has not demonstrated how the respondent and interested party’s conduct has the effect of concealing, disguising the nature, source, location, disposition, or movement of the said funds or the ownership thereof or any interest which anyone may have in respect thereof. That there is no complexity demonstrated from a mere transfer of funds from interested party’s to the respondent’s account; thus there being no demonstration of the so-called complex scheme.

44. To the respondent, the money received from the interested party was both a loan and a gift; and that interested party is a well-known investor, cryptocurrency expert, and philanthropist; who also has a running account with Interactive Brokerage firm that trade on his behalf. The respondent avers that, as per the applicant, since the amounts that have been sent are huge, then they must be from proceeds of crime and/or money laundering.

45. The respondent contends that the applicant has alleged a complex money laundering, yet there has never been any transfer of money between the respondent and those alleged to be in the said conspiracy.

46. As such, that should this court grant the prayer of forfeiture, it will give credence and legitimacy to the applicant to be merely making allegations and falsely accusing Kenyans with a view of forfeiting their funds even where the same has been legally acquired.

47. It is alleged that the applicant has failed to show the court that respondent has used the funds received in any nefarious ways or furtherance of any criminal or illegal activities. No evidence has been tabled by the applicant and thus this application should fail.

Interested Party’s Case 48. In further opposition to the application, the interested party in his replying affidavit dated 18th April, 2023 deponed that the applicant have not conducted any proper investigations to establish the legitimacy, or otherwise as to the source of the wealth/money.

49. To the interested party, the applicant is merely pushing to have the funds forfeited without establishing whether indeed the said funds are proceeds of crime or are subject to any money laundering activities. That the onus of proving any illegality is on the applicant, which they have failed to do so.

50. The interested party conceded to being the person who sent the monies to the respondent and others. it is claimed that the proceedings/cases against some of the others were withdrawn by the applicant from court unconditionally; but for this instant matter.

51. Thus, that the applicant is estopped by its conduct from further prosecuting this matter or getting the orders prayed for. as such, that in pursuing this matter, the applicant is acting in a discriminatory manner, contrary to the spirit and intent of the law as captured in article 27 of the Kenya Constitution 2010.

52. The interested party claims that monies sent to the respondent was a loan to assist him (respondent) invest in Portugal and procure citizenship there; and that the monies were acquired legally in trading stocks and shares a running account with Interactive Brokerage firm, besides being a philanthropist.

53. As to his source of wealth, the Interested party contends that there have not been [past or present] complaints nor criminal investigations against him, his businesses or financial dealings in any other jurisdiction, except of this instant matter in Kenya‑where the suspicious illegal activities are without possible justifiable reason.

54. Further, that the Applicant has neglected and/or refused entirely to conduct any form of investigations in respect to the funds, subject matter herein; despite having the capacity, co-operation, and resources to do the investigations in Belgium, Kenya, or any other jurisdiction.

55. To wit, that this honourable court should rescind the order of preservation and grant the respondent full access to his funds and dismiss this application for forfeiture with cost.

56. Additionally, the interested party filed his supplementary affidavit dated 20th July, 2023 further opposing the application. It is averred that at the time of filing his case, he did not have in his possession some material evidence that he has now managed to access, which will assist the court in determining this matter.

57. It is claimed that the money sent by the interested party to the respondent as a personal loan for citizenship and investment in Portugal, was derived from sale of his (interested party’s) shares of LPG in 2021, which shares were acquired and sold before sending the money to the respondent. Also, that the money was gotten from an inherited estate, that was sold and from other investments was used to purchase TSLA shares. Therefore, that the interested party has sufficiently demonstrated the source of his money, sent to the respondent.

Applicant’s Submissions 58. To buttress their cases, parties were granted an opportunity to file their written submissions. From the record before this court, it is only the Applicant who filed its written submissions dated 6th July, 2023.

59. The Applicant submits that as per article 40(6) of the Constitution of Kenya, 2010 the framework on asset recovery does not extend to the rights to property envisaged under article 40, to any property that has been found to have been unlawfully acquired.

60. Further, that section 92(1) of the POCAMLA provides that the High Court shall make an order for forfeiture, if it finds on a balance of probabilities that the property concerned has been used or is intended for use in the commission of an offence; or is proceeds of crime.

61. That forfeiture proceedings are civil in nature, and the standard of proof is on a balance of probabilities; and is anchored in section 92(4) of the POCAMLA. That under the POCAMLA: Proceeds of Crime is defined by section 2; Money Laundering is provided by section 3; while, the offence is provided by section 4 of the Act.

62. It is posited that such positions, as captured herein above, have been affirmed by court relying in the case of Director of Assets Recovery and others Republic v Green & others [2005] EWHC 3168; in the case of Assets Recover Agency v Pamela Aboo: Ethics & Anti-Corruption Commission (interested Party) [2018] eKLR which cited ARA & others v Audrene Samantha Rowe & Others Civil Division claim No 2012 HCV 02120 the Court of Appeal of Jamaica; on the case of Abdulrahman Mahmoud Sheikh & 66 others y Republic & others [2016] eKLR; and in Assets Recovery Agency v Quorandum Limited supra & 2 Others [2018] eKLR which cited Schabir Shaik & others v State Case CCT 86/06(2008) ZACC7 case.

63. In the submissions, the applicant maintains that the funds held in the respondents identified bank account are proceeds of crime, as the funds therein constitute property and/or economic advantage, derived or realized as a result of, or in connection of an offence. In particular, that the offence constitutes money laundering as defined in section 3 as read together with section 16 of the POCAMLA.

64. According to the applicant, the money laundering scheme was executed by the interested party who entered and engaged in an arrangement with the respondent and four (4) other persons to launder funds in an effort to conceal and disguise the disposition and movement of the funds. That the interested party transferred approximately USD 6,141,463. 43 an equivalent of Kshs. 650,995,123. 25 to the respondent and four (4) other persons cumulatively between February 2020 and August 2021, a period of under 19 months.

65. The applicant avers that, in respect to the respondents bank account no. xxxx held at Stanbic Bank, he/it received a total of USD 349,915. 00 on November 2021. The funds were sent from the respondent's Standard Chartered Bank account number xxxx which originated from the interested party having sent 370. 990 Euros on 6th April, 2021. That the received funds were either declared as gifts and/or donations, and recipients of the funds were related.

66. According to the applicant, the scheme/syndicate exploited by the interested party targeted young individuals between the age of 19 - 26 years of age who were not financially independent and had family ties to at least one other person in the scheme and to himself for purposes of exploitation and exercising control of the funds.

67. The applicant submits that the explanation of the source of funds, by the interested party, is not adequate as the legitimacy of the funds are unknown. The explanation that the Interested Party deals in crypto currency and source of funds being from his crypto-account held in Interactive Brokers has not been explained by the Interested Party. And, thus, on a balance of probabilities, the funds are proceeds of crime. Also the court is called to take notice of the untraceable and unregulated nature of the virtual currencies, as issued by the Central Bank of Kenya in a notice to the public issued in December, 2015.

68. It is submitted that to prove reasonable suspicion, the prosecution need not show the link between the source of the money or the accused’s possible criminal conduct. It is sufficient that possession and reasonable suspicion are proved. That this position was held by the Supreme of Court of Zambia in Revision of People v Laito (Appeal No.291/2014) [2015] ZMSC 26 (1 June2015).

69. The applicant maintains that in the instant matter, they have established both possession and reasonable suspicion that the funds held in the respondents bank account are proceeds of crime: that it is established the respondent is a student, not engaged nor generating income in the construction industry as alleged in the account opening documents; that he has tax arrears of Kshs. 16,560,589 with the Kenya Revenue Authority and that he declared the funds received in his bank account from the Interested Party as a personal loan in the SWIFT, and later as a gift in the letter by Ndindi & Nadida Advocates.

70. It is admitted that the burden of proof in civil cases is on a balance of probabilities; as discussed by Denning J. in Miller v Minister of Pensions (1947) 2 All ER 372. Similarly, that in forfeiture proceedings being civil in nature, as the instant one, the burden of prove is on a balance of probabilities: and that position was affirmed in Kenya Anti-Corruption Commission v Stanley Mombo Amuti [2017] eKLR, and in Assets Recovery Agency v Fisher, Rohan and Miller, Delores, Supreme Court of Jamaica, Claim No 2007 HCV003259.

71. It is also submitted that reliance of the documents submitted by the respondent and the interested party, in respect to the newspaper articles are inadmissible as they constitute hearsay evidence, as espoused by the Court of Appeal in the case of Independent Electoral and Boundaries Commission (IEBC) v National Super Alliance(NASA) Kenya & 6 others [2017] eKLR

72. In the end, the applicant submits that it has on a balance of probabilities discharged its burden in support of its case that the funds held in the respondent’s bank account constitute proceeds of crime, thus ought to be forfeited to the State. Therefore, that the originating motion dated 23rd May, 2022 is merited and should be allowed as prayed.

The Respondents and Interested Party’s Submissions 73. Learned counsel for the respondent and the interested party filed consolidated written submissions which are dated 26th July 2023. Although they were filed out of time this court has in the interest of justice put them into consideration.

74. Learned counsel framed five issues for determination upon which they then proceeded to submit. The issues are:-a.Whether the respondent and interested party have provided sufficient proof of the legitimacy of source of funds thus discharging the burden of proof.b.To what extent must a party who is a foreigner prove they have legally acquired their wealth?c.Whether the Asset Recovery Agency have a responsibility to investigate a foreigner’s source of funds before commencing proceedings under the PROCAMLA for forfeiture of funds.d.Whether this suit can stand after withdrawal of other related suits where the interested party send monies to other parties from the same source.e.Whether the applicant has provided proof that the funds are proceeds of crime or from money laundering activities to warrant forfeiture.

75. Counsel submitted that Kenyan concept of “unexplained assets” is akin to “Unexplained Wealth Order” (UWO) under the United Kingdom Proceeds of Crime Act 2002 ("POCA"). Section 362A of the UK POCA defines an unexplained wealth order is an order requiring the respondent to provide a statement: -a.setting out the nature and extent of the respondent's interest in the property in respect of which the order is made;b.explaining how the respondent obtained the property (including, in particular, how any costs incurred in obtaining it were met);c.where the property is held by the trustees of a settlement, setting out such details of the settlement as may be specified in the order, andd.setting out such other information in connection with the property as may be so specified.Counsel supported their submissions by citing the case of National Crime Agency v Mrs. A [2018] EWH 2534 where it was held:-“It was held that, for an unexplained wealth order to issue, there must be reasonable grounds for suspecting that the known sources of an individual’s lawfully obtained income would have been insufficient for the purpose of enabling the individual to obtain the property. The court observed that one of the critical factors to be taken in account is the “income requirement” and an individual required to explain source of wealth should lead sufficient evidence to defeat any "reasonable grounds for suspicion" under the income requirement.”

76. Counsel contended that the crux of this case is whether the respondent has answered the question of where the money originates.

77. Referring this court to the replying and supplementary affidavits of the interested party counsel submitted that the interested party explained that he made his wealth through hard work making him a dollar millionaire recognized in both Europe and North America; that he was also an heir of his mother’s estate and it is from there that he upon attaining the age of majority that he received the amounts which he invested hence embarking on a journey of wealth creation through stocks in Tesla and LPG companies and also cryptocurrency; that the interested party has therefore demonstrated that the initial source of his wealth came from inheritance.

78. Counsel further stated that the money deposited in the respondent’s account was a personal loan which was to be repaid with interest on or before 21st May 2029. Counsel stated that the money was to assist the respondent enrol in the Gold visa program in Portugal so that he could obtain citizenship by way of investment. Counsel described the submission by the applicant that he funds could not be simplistic. Counsel contended that the Interested party has no criminal record either in Belgium or in any other country and that he in fact has a certificate of good conduct issued to him by the DCI in Kenya on 5th February 2021. Counsel wondered whether any foreigner who comes to Kenya with their money will be accused of being a criminal without proof or whether they will be barred from sending money to those they desire out of fear of illegal confiscation. Counsel contended that the Applicant has not adduced evidence to demonstrate that the money was proceeds of crime or money laundering; that whereas no criminal offence need be proved there must be evidence of unlawful conduct and this was not proved at all. Counsel stated that the Applicant has no justifiable reason to believe that the funds were proceeds of crime; that they have demonstrated that the Interested Party is a well-known, famous and notorious man known for his prowess in trading stocks, bonds and forex having received assets from his mother’s estate and multiplied the wealth over the years.

79. Counsel asserted that none of the ingredients of money laundering set out in section 3(b)(i) of the Proceeds of Crime and Anti-Money laundering Act were proved; that the transaction was done with no secrecy; that section 3(b) (ii) is even more stringent and as it was also not proved the applicant has not discharged its burden of proof as was settled in the case of Miller v Minister of Pensions [1947] 2 ALL ER 372.

80. Counsel urged that this court cannot refute the origin of the funds once it has been discovered or revealed; that this should have informed the applicant in finding out if the source of funds was legitimate. Counsel wondered why the applicant’s conclusion that the interested party was in control of the respondent came from; that it cannot be assumed that since the interested party has sent money to various people then he was controlling them and manipulating them; that the interested party and Felista Nyamathira Njoroge demonstrated that they indeed have a relationship.

81. Counsel further submitted that for the applicant to raise queries regarding a foreigner’s wealth there must be evidence of an accusation from the country of origin otherwise what would be the foundation of the suspicion by the applicant. Counsel reiterated that the respondent and the interested party have demonstrated the funds are legitimate; that the applicant has not even discharged the evidential burden yet a letter to the Embassy through Interpol Kenya would have sufficed to inform their suspicion.

82. Counsel also submitted that given the withdrawal of HCACEC Suits No. E007 and E016 of 2022 these proceedings cannot stand; that it is a witch-hunt against the respondent for personal gain and further that this case ought to be dismissed with costs as it has not been proved. Counsel urged this court to uphold its own decision in the case of Asset Recovery Agency v Muazu Bala ACEC Suit No. E005 of 2021 where it stated:-“It is clear from the above cases that the onus lies upon the applicant to prove that there is reasonable suspicion that the funds found in the respondent’s possession are proceeds of crime. Once that burden is discharged the evidential burden shifts to the respondent to explain the source of the funds. However, the Agency need not prove the commission of a specific criminal offence. It is sufficient if it proves a particular kind(s) of unlawful conduct by which the funds were acquired”

Issue for Determination 83. I have considered the application, the responses thereto, annexures, and the submissions. I have also considered the authorities presented by parties. The following issue for determination crystalizes: Whether the funds USD 390,038. 72 held in Account Number xxxx at Stanbic Bank in the name of Timothy Waigwa Maina are proceeds of crime and liable to be forfeited to the State.

Analysis and Determination 84. The applicant has invoked the jurisdiction of this court under sections 90 and 92(1) of the POCAMLA which provides that: -“90(1)If a preservation order is in force, the Agency Director may apply to the High Court for an order forfeiting to the government all or any of the property that is subject to the preservation order.....92. Making of forfeiture order(1)The High Court shall, subject to section 94, make an order applied for under section 90(1) if it finds on a balance of probabilities that the property concerned—(a)has been used or is intended for use in the commission of an offence; or(b)is proceeds of crime.”

85. The term “proceeds of crime” is defined under section 2 of the Act as:-“any property or economic advantage derived or realized, directly or indirectly, as a result of or in connection with an offence irrespective of the identity of the offender and includes, on a proportional basis, property into which any property derived or realized directly from the offence was later successively converted, transformed or intermingled, as well as income, capital or other economic gains or benefits derived or realized from such property from the time the offence was committed.”

86. In the case of Schabir Shaik & others v State Case CCT 86/06[2008] ZACC 7 the court expressed itself as follows in regard to this wide ambit of the definition:-“.... One of the reasons for the wide ambit of the definition of “proceeds of crime” is, as the Supreme Court of Appeal noted, that sophisticated criminals will seek to avoid proceeds being confiscated by creating complex systems of “Camouflage”. The Supreme Court of Appeal held that a person who has benefited through the enrichment of a company as a result of a crime in which that person has an interest will have indirectly benefited from that crime.”

87. The crux of the applicant’s case is that the interested party has recruited the respondent (Timothy Waigwa Maina), and four others who it names as: Jane Wangui Kago, Serah Wambui Kamanda, Tebby Wambuku Kago and Timothy Waigwa Kiwanja. The named persons are all related to the respondent. They were recruited into a complex scheme of money laundering; that the deposit of large amounts of money into the Respondent’s accounts is a money laundering scheme; thus, the funds are proceeds of crime.

88. It is trite that the burden of proof lies upon the applicant to prove on a balance of probabilities that the impugned funds are proceeds of crime. However, once this burden is discharged the evidential burden shifts to the respondent to prove that the funds were lawfully acquired, and are not proceeds of crime. See the case of Assets Recovery Agency v Muazu Bala [2022] KEHC 11829 KLR where this court cited with approval the case of Assets Recovery Agency v Fischer Rohan & Miller Delores Supreme Court of Jamaica Claim No. 2007 HCV 003259 where it was held: -“…Even though these proceedings are quasi criminal in nature, there is an evidential burden of proof on the defendant. It is incumbent upon them to demonstrate evidentially how they lawfully came into possession of the assets seized.”

89. It is however instructive that as provided in section 92(4) of the POCAMLA the applicant need not prove the commission of a specific offence in regard to the funds. In the case of Assets Recovery Agency v Pamela Aboo; Ethics & Anti-Corruption Commission (Interested Party) [2018] eKLR where it was held that: -“63. Forfeiture proceedings are Civil in nature and that is why the standard of proof is on a balance of probabilities. See section 92(1) of POCAMLA. In the case of Director of Assets Recovery and Others, Republic v Green & others [2005] EWHC 3168 the court stated as follows: -In civil proceedings for recovery under part 5 of the Act the Director need not allege the commission of any specific criminal offence but must set out the matters that are alleged to constitute the particular kind or kinds of unlawful conduct by or in return for which the property was obtained.”

90. It is not disputed that the respondent, who at all times material to these proceedings was a student and had indicated to be in the construction and real estate industry with an income range of Ksh. 150,001-400,000, received large amounts of cash in his bank accounts at Standard Chartered Bank, including the impugned monies. The fact that he did not have an established a source of income from which he could have earned this kind of money, and which facts are not disputed would certainly require an explanation from him as to the source of the huge deposits. This is especially so because financial institutions bore an obligation under section 44 of the POCAMLA to report any cash deposit above 1 million to the Financial Reporting Centre established under section 21 of the Act, as part of its efforts to stem money laundering and other offences.

91. It is my finding therefore, that the huge cash deposits were suspicious in the circumstances and the evidential burden therefore properly shifted to the respondent to prove not only the source of the funds, but that the source of funds is a legitimate one. My so saying finds support in the case of Assets Recovery Agency v Pamela Aboo; Ethics & Anti-Corruption Commission (Interested Party) (supra) where the court stated: -“61. Where the person against whom allegations have been made does not give a satisfactory explanation to rebut the allegations, it means what has been presented is not challenged. In this case there is no explanation of the source of the huge deposits into the respondent’s accounts. Even a glance at the cash deposits made at Donholm branch of Equity Bank would call for an explanation by the respondent as to who was making the deposits and for what purpose.62. The moment the applicant established through the bank statements that there were huge cash deposits, the burden shifted to the respondent to explain the source. A lot has been said about the respondent’s husband by both parties but this court is not using that information against the respondent. The respondent had a clear duty to explain the source or sources of these huge deposits into her account which she has failed to do.”

92. This finding also finds support in the case of Assets Recovery Agency v Fisher Rohan & Miller Delores Supreme Court of Jamaica Claim no. 2007 HCV 003259 (supra) where the court stated: -“… Even though these proceedings are quasi criminal in nature there is an evidential burden of proof on the defendant. It is incumbent on them to demonstrate evidentially how they lawfully came into possession of the assets seized. Miller for example merely says she worked/works as an haggler but has amassed thousands of United States dollars without more.”There is no indication of any work place or higgle ring or any enterprise on her part. The only reasonable and inescapable inference based on all the evidence is that the properties seized are properties obtained through unlawful conduct and are therefore recoverable properties.This court finds applicants case proved and will make a recovery order in respect of the properties seized as per the freezing order dated the 14th August, 2007. This court found that none of the monies from the freezer was the property of Delores Miller nor earned by her. The money was part of the proceeds of the criminal activities of her two sons, Rohan Anthony Fisher and Ricardo Fisher and as such are part of the recoverable assets…”

93. This is no way a contradiction of my finding in the case of Assets Recovery Agency v Muazu Bala [2022] KEHC 11829 KLR given that the legal burden of proof remains with the plaintiff throughout the proceedings, and it is only once that burden is discharged on a balance of probabilities that the evidential burden shifts to the defendant.

94. The explanation offered by the respondent, who together with the plaintiff are the principal parties in this case, is that the large deposits are gifts and loans, from the interested party to him. He did not however, proffer any sufficient explanation on the source of the funds preferring instead to leave that to the interested party.

95. On his part, the interested party’s explanation was that the money came from a legitimate source; that he acquired the same from trading in stocks and bitcoins through a firm, in his home country Belgium, known as Interactive Brokers LLC, from the sale of his shares of LPG in 2021. Also, that the money was gotten from an inherited estate, that was sold and from other investments was used to purchase TSLA shares. That he had no criminal record; that he was an astute bitcoin trader of good repute as evidenced by the documents which he has annexed; and that the respondent was his personal assistant to whom he had advanced a loan to enable him get a golden visa in Portugal and invest, while at the same time the monies were a gift to him.

96. He (interested party) contended that the claim by the applicant that he was using the respondent to launder dirty money was malicious as the applicant had refused to accept his documents explaining the source of the funds. Further, that the allegation that the respondent was involved in a money laundering scheme was not proven and this application ought therefore to be dismissed and the monies returned.

97. I entirely agree with the interested party that there is nothing untoward with a man gifting money or advancing a loan. An explanation that the source of these large sums of money is a legitimate one, and that the funds are not tainted, is therefore the crux of the matter in these proceedings.

98. I have carefully and painstakingly perused the documents placed before this court by the interested party, and my finding is that none of them clearly demonstrate that the monies were from a legitimate source. The documents from Interactive Brokers LLC do not demonstrate how the funds, the subject of this case and which were deposited by the interested party into the respondent’s account were acquired. Whereas Interactive Brokers may be a reputable firm and the document shows that the interested party maintained an account with the Brokerage there is no sufficient and credible evidence of the source of funds by which the interested party traded through the firm. What I will refer to loosely as the seed money is what is in issue. The onus was on the interested party to explain the source of the funds, how he invested it and how it is that it grew so exponentially that he could dole out such huge sums of money to the respondent and his relatives with no consideration at all.

99. In paragraph 10 of the supplementary affidavit sworn on 20th July 2023, the interested party deposes that the money he used to purchase the TSLA shares accrued from previous investments and more so from an inherited estate that he sold. He adduced evidence of the inheritance in annexture marked “DMD3C.”

100. I have carefully perused the above annexture. The same is a statement made in English by one Mr. Freddy De Messel in regard to the estate of Mrs. Martin Olivier, deceased, of who the Interested Party is named as one of her children. It contains a long inventory of property that belonged to the deceased and which were to devolve to Mr. Freddy De Messel on behalf of the interested party and his siblings. Thereafter there are documents which seem to suggest that some funds were transferred to De Messel Marco and some other persons however some of the documents do not have a translation and this court could not understand them. It is therefore not very clear that the transfers were from the inheritance and indeed there is no evidence at all that the interested party received any monies from the sale of property acquired from an inheritance. It is also instructive that there is no document in the official language of this court to indicate the properties bequeathed to him which he could have sold as alleged. In the premises I am unable to find that the seed capital accrued from an inheritance as alleged in paragraph 10 of the further affidavit. The interested party has therefore not discharged the evidential burden placed upon him by section 112 of the Evidence Act.

101. It is also intriguing that although the interested party deposes that he has many different portfolios, and he attempts to show how he made the money, he did not avail any cogent evidence of the said portfolio/source to satisfactorily demonstrate how he raised the money from the same.

102. In the case of Assets Recovery Agency v Pamela Aboo: Ethics & Anti-Corruption Commission (Interested Party) [2018] eKLR the court observed and I agree that: -“I have done an analysis of the deposits above and shown how much was being deposited in a day or so for the Respondent. Even with all this, the Respondent has not attempted to explain the source of this money either through the replying or supplementary affidavit. It could be true that she does business with Samson Waweru, Jonathan Kimindu and her own business but where is the evidence......One is at liberty to deposit even a billion shillings but the person must be ready to share the source of such huge deposits with the relevant authorities. When no satisfactory explanation is forthcoming the court will take it that the same was not lawfully acquired”.

103. Similarly, in this case the interested party, apart from alluding to the credibility of the brokerage firm through which he allegedly traded, and the claimed inheritance, he has not sufficiently demonstrated the source of the funds, the subject of that trade as would be required of him under section 112 of the Evidence Act which states:“112. Proof of special knowledge in civil proceedingsIn civil proceedings, when any fact is especially within the knowledge of any party to those proceedings, the burden of proving or disproving that fact is upon him.” 104. The fact that the interested party has no criminal record from his home country and from Kenya is of no probative value as civil forfeiture is not dependent on criminal culpability. Again, I agree with the finding of Mumbi Ngugi J, as she then was, in the case of Assets Recovery Agency v Lilian Wanja Muthoni t/a Sahara Consultants & 5 Others [2020] eKLR where she observed: -

“134. The respondents have contended that the funds in the ten accounts were from various sources including savings from the 1st respondent’s employment salary and allowances part of which were deposited into the accounts; diverse activities in real estate, landholding and construction ventures, as well as mortgages and loans for investment in profit making ventures, the legitimate proceeds from which were directed into the subject bank accounts. As I have found above, there is no evidence that supports these contentions.135. What I discern from the respondents’ submissions is that since the applicant has not shown a direct link between the funds in the said accounts and the funds alleged to have been stolen from the NYS, the said funds are not proceeds of crime, and should therefore not be forfeited to the State. I take the view, however, that POCAMLA and the entire legal regime related to recovery of proceeds of crime and unexplained assets has the underlying premise that crime and corruption are undertaken in a labyrinthine, secretive manner; that funds and assets may not be directly traced to crime; that while investigations may be carried out, some alleged perpetrators charged and subjected to trial, a conviction may not result. Yet, the respondent may have in his or her possession substantial funds and assets, but is not able to show a legitimate source of the funds and assets.136. The question is what, in such circumstances, should be the option? Is it to say, as the respondents ask the court to do, that there is no trail leading the funds to the suspected source, in this case the NYS funds? That the funds do not belong to the State just because the respondents cannot show a legitimate source? What would such a conclusion mean in relation to the tracing and recovery of, say, funds and assets derived from the narcotics trade, cyber-crime or piracy, or from trafficking in wildlife, or in persons? 137. I believe I would not be remiss if I asserted as an incontrovertible truth that money and assets are not plucked from the air or, like fruits, from trees. They can be traced to specific sources- salaries, businesses in which one sells specific items or goods, or provides professional services. There must be books of accounts, stock registers, local purchases orders and delivery notes showing to whom goods are sold, deliveries made and payment receipts showing from whom payment has been received.”

105. In the absence of evidence of a legitimate source, this court is entitled to conclude that these funds were proceeds of crime, hence liable for forfeiture. It is immaterial that other similar suits have been withdrawn by the Plaintiff. It is my finding that purporting that the money was a loan/gift was just but a means of concealing that the deposit was but a way of laundering the funds.

106. It is my finding that the huge size of the deposits, and the fact that the interested party was also depositing similar accounts of the respondent’s relatives’ accounts, ought reasonably to have aroused the respondent’s suspicion that something was amiss. He nevertheless, went ahead and agreed to his account being used as a conduit to conceal those funds. The circumstances of this case make it clear that the respondent was being used to launder the money. That is a crime under section 3 of the POCAMLA and he is not entitled to benefit from the tainted funds. I have made a similar finding in a related case in Assets Recovery Agency v Njoroge; Mesel (Interested Party) (Civil Application E006 of 2022) [2023] KEHC 17943 (KLR).

107. I am satisfied therefore, that the applicant has proved its case on a balance of probabilities and accordingly the originating motion dated 23rd May, 2022 succeeds and the funds: USD 390,038. 72 held in Account Number xxxx at Stanbic Bank in the name of Timothy Waigwa Maina, shall be forfeited to the State.

108. Costs follow the event and the respondent and the Interested party shall therefore bear the costs of these proceedings.

It is so ordered.

DATED DELIVERED AND SIGNED VIRTUALLY THIS 2ND DAY OF NOVEMBER, 2023. E. N. MAINAJUDGE