High Court freezes South Sudan Minister’s account over money laundering

The High Court in Nairobi has upheld application by the Asset Recovery Agency ARA) to freeze bank accounts owned and operated by South Sudanese minister over suspicion of money laundering.

South Sudan minister for Cabinet Affairs Martin Elia Lomuro’s bank account in Kenya is subject of ongoing money laundering probe involving multiple jurisdictions including United Kingdom.

Lomuro holds dual citizenship of South Sudan and United Kingdom and is accused of fanning violence.

Justice James Wakiaga issued the orders to have Lomuro’s bank accounts frozen containing Sh13.42 million.

Preliminary analysis of the bank statement for the dollar account established a total of $460,896.20 (Sh46, 089,620) was transferred Lomuro’s account.

Consequently, several transactions were made in the account between January 4, 2018 and January 2, 2020 total to the tune of Sh46.20 million.

In a case filed by senior state council Stephen Githinji on behalf of ARA director, the agency said Lomuro’s account at the bank made several suspicious transactions pointing to money laundering.

“There are reasonable grounds to believe that the funds held by the respondent in the specified bank account are direct benefits, profits and or proceeds of crime obtained from a complex money-laundering scheme and are liable to be forfeited to the state under the Proceeds of Crime and Anti-Money Laundering Act, 2009,” the application reads in part.

“There is an imminent risk that the funds sought to be preserved shall dissipate by virtue of being taken away from the jurisdiction of this Honourable Court before investigations into the legitimacy or otherwise of the funds are established.” Githinji added.

In 2019, South Sudan president Salva Kiir replaced Lomuro as chairperson of the committee tasked to investigate oil pre-sale contracts and replaced by Awou Daniel Chuang.

Besides probing the pre-sale process, payments and taxes, the committee was tasked to coordinate with the country’s auditor general to reconcile payments and liabilities against the government.

The same year, the United States imposed sanctions on Lomuro and the then Minister of Defense and Veteran Affairs Kuol Manyang Juuk through the Treasury’s Office of Foreign Assets Control (OFAC).

Through the US Treasury Department, the duo were blacklisted for their alleged role in perpetuating the conflict by obstructing the peace process.

Lomuro was accused of recruiting and organising militias to attack opposition forces, and Juuk of failing to remove forces from the battlefield as agreed, stirring up violence with rival tribes and preparing militias for the possibility of renewed violence.

The sanctions froze any US assets held by the officials and prohibit Americans from doing business with them.

According to a supporting affidavit sworn by Isaac Nakitare, an investigative officer attached to the agency, Lomuro operated two banks accounts at the bank – one of them a dollar only account.

The dollar account received $351, 317.81 as credit out of which $351,293.52 was debited for the period September 2017-January 2020, Nakitare said in the affidavit.

It adds, “On December 24, 2019 the respondent instructed the bank to close down his dollar account and send the funds to his local account.”

Further, preliminary analysis of the bank statement for the dollar established a total of $460,896.20 was transferred to Lomuro’s local currency account.

Several transactions were made in the account between January 4, 2018 and January 2, 2020 to the tune of Sh46.20 million.

Nakitare stated in the affidavit that Lomuro made suspicious cash transfers to a bank account held in the name of a Ms Rejah Kedi Ladu Kenyi, an indication that they worked jointly in the suspected money
laundering racket.

The probe also revealed that Lomuro’s account had been credited with Sh122.78 million out of which, Sh109.36 was debited.

This left a balance of Sh13.42 million which the agency sought to be preserved. The amount is declared as salary.

“The preliminary analysis of the bank statement held in the name of the respondent does not demonstrate a consistent source of funds which could reasonably be said to be salary,” the officer noted.

The investigation further revealed that Rejab’s accounts received Sh42.322 million.

Out of the amount, Sh39.68 million was received from various sources on diverse dates between September 14, 2017 and December 29, 2020.

“That investigation has established that MS Rejah Kedi Ladu Kenyi Martin Elias Lomuro received a total of Sh49.43 million as forex reversal. Of this amount, Sh46.20 million was from his USSD account,”
it says.

The investigative office concluded, “That there are reasonable grounds to believe that the bank accounts of the respondent were used as conduits of illicit financial flows and money laundering”.