Seven arraigned over Sh309 million insurance fraud

The accused were arrainged before the Milimani Law Courts facing multiple charges. [DCI, Facebook]

Seven current and former directors of Invesco Assurance Company Limited and Compliant Insurance Agency were on Tuesday arraigned before the Chief Magistrate's Court in Milimani over their alleged involvement in a Sh 309 million insurance fraud scheme.

The accused, Albert Karakacha Muhavani (former director, Invesco), Daniel Wekesa Nyalyanya (former CFO, Invesco), Michael Nganga Kibara (former accountant, Invesco), Ruth Wangari Mwasalu, Antony Githinji Ngerere, Hildah Wambui Karanja, and Lameck Gisore Ongere (all directors at Compliant Insurance Agency) face multiple charges stemming from months-long investigations led by the Directorate of Criminal Investigations (DCI).

According to the DCI's Insurance Fraud Investigation Unit, the probe began in September 2024 following a tip-off from the Insurance Regulatory Authority (IRA).

The investigation was triggered after the Policyholders Compensation Fund (PCF), which had taken over the management of Invesco Assurance under statutory management, unearthed a hidden bank account held at M Oriental Bank's Sameer Business Park branch.

The account, registered under Compliant Insurance Agency, had been opened on May 1, 2024, and was allegedly used to divert funds.

Authorities claim that premium collections from Invesco's 27 branches nationwide were funneled into this undisclosed account.

Between May and August 2024, investigators say the accused siphoned approximately Sh309 million into their individual Mpesa accounts.

After compiling witness statements and documentary evidence, the DCI submitted a case file to the Office of the Director of Public Prosecutions (ODPP), which approved the charges.

The seven now face charges of Insurance Fraud contrary to Section 204B(2) as read with Section 204B(5) of the Insurance Act.

Additionally, the four directors from Compliant Insurance Agency - Mwasalu, Ngerere, Karanja, and Ongere - have been charged with Stealing by Directors, in violation of Section 282 of the Penal Code.