Kenyan subsidiaries of two United States of America (USA) registered exclusive private air charter service firms represented locally by flamboyant Nairobi businessman Chris Obure who has a history of multiple run-ins with the criminal justice system including gold scamming and now a murder suspect in killing of Kelvin Omwenga have failed in a bid to lift an order imposed on its banks accounts, which were frozen over suspicions that millions wired from outside the country through an intricate money laundering syndicate.
The presiding judge of the Anti-Corruption Division of the High Court Esther Maina dismissed application to unfreeze the bank accounts belonging to Cullinan Private Jet Corp and Glo-Jet International Limited.
Justice Maina said it was ironical for the two firms, which are subsidiaries of global multi-billion dollar companies with operations in 47 countries- with financial muscle to support the Kenyan entities – to claim that it was unable to meet its financial obligations because of the freeze.
The judge said the facts presented to the court by the Assets Recovery Agency (ARA) disclosed reasonable grounds to believe that the funds in question are proceeds of crime.
“That, prima facie evidence is of course subject to the agency proving its case on a balance of probabilities at the hearing of the forfeiture application, if any, where the Respondent shall also get opportunity to present its evidence.” Justice Maina ruled.
The High Court issued the freeze on September 22, 2023 on two bank accounts at I & M Bank in the names of Cullinan Jets Corp and two others, in the names of Glo-Jet held at Eco Bank holding over Sh18.9million.
The freeze order prohibited the operators or their agents or representatives from transacting, withdrawing, transferring, using and any other dealing with the money in the bank accounts.
The Bank accounts includes USD54,257.85, Sh696,070.70 held in Account Number 01904057366250 registered in the name of Cullinan Private Jets Corp Limited held at I & M Bank and USD24,712.61 held in Account Number 6658001882 in the name of Glo Jet International Limited and Sh1,134,691.33 held in Account number 6658001881 in the of Glo Jet International Limited held at Ecobank Limited.
Obure is the local representative of the two companies.
Cullinan Jets Corp is an exclusive executive international private jet chartered services, a subsidiary of a company registered in Miami, USA while Glo-Jet is a subsidiary of Glo-Jet International Corp, a firm registered in Florida, USA.
ARA applied for the freeze following an inquiry into the activities of the firms, which established that there were reasonable grounds to believe that the accounts received huge deposits of cash suspected to be unlawfully acquired.
Through counsel Mohamed Adow, the agency said the money in the bank accounts is reasonably believed to be proceeds of crime obtained through money laundering and the firms have no right to remain with it.
He contended that the argument that the money was lawfully acquired can only be canvassed at the hearing of the forfeiture application but not at this stage.
According to ARA court documents, financial investigations conducted by the agency revealed complex fraud and money laundering schemes conducted by the Cullinan Private Jets Corp Ltd and Glo-jet International ltd their directors and associates rendering the above funds proceeds of crime liable for preservation and forfeiture.
The said bank accounts received suspicious huge cash deposits from various suspicious sources and investigations established that there are reasonable grounds to believe that the funds in issue are obtained through illegitimate means.
“The investigations have revealed that the cash deposits were unlawfully acquired hence proceeds of crime pursuant to the Provisions of Proceeds of Crime and Anti-Money Laundering Act and investigations further established that the funds were obtained from various suspicious sources and spent/dispersed through suspicious activities and transactions in a classical money laundering schemes.” ARA told the court.
The respondents are subsidiaries of highly revered conglomerates with International presence with Annual turn overs of millions of dollars, so should the court find that the funds are proceeds of crime, the applicant will still be able to recover the amounts.
The air charter services firms maintained that no cash deposits have ever been made in the subject accounts as all funds therein are wired from the Central Revenue Collection, Disbursement and Financial Management Centre (CRCDFMC) based at the company’s headquarters in Orlando, Florida.
Louis Iteba Pamba and Geffrey Somoni Birundi explained in affidavits filed in court that because of the preservation orders, the parent company was considering closing the Kenyan subsidiary and moving its operations to South Africa citing a “hostile environment” for international strategic investment.
While pleading with the court to lift the order, the firms said they were subsidiaries of revered conglomerates with annual turn overs of millions of dollars and in the event that the court finds that the funds are proceeds of crime, the Agency shall be able to recover the money.
According to Pamba, the accounts receive money from their holding company in the USA to make payments for salaries, service providers and bills.
He said the preservation orders were obtained on the basis of allegations, suspicions and presumptions contrary to the tenets of law and natural justices no evidence was tabled to demonstrate existence of a prima facie case to justify the order.
The court was informed that the agency summoned the firms’ two top directors for questioning where critical information and supporting documents relating to the operations of the companies were presented.
The firm said cheques issued to third parties have been dishonoured, a move that was likely to attract penalties and the firms run the risk of being subjected to expensive court action and litigation for failure to discharge their financial obligations and commitments to third parties.
Further, that the orders have negatively affected revenue flows due to customer’s due diligence before bookings, leading to loss of revenue.
The judge, however, said cheques are generated internally and the mere fact of their having been drawn is not evidence that they were not honoured.
