A High Court judge has disqualified himself from a case where a lawyer has sued I&M Bank for freezing his accounts over the Sh791 million National Youth Service (NYS) scandal.
Justice Eric Ogolla (pictured) yesterday disqualified himself from the case, citing personal reasons.
The lawyer, Patrick Ogola sued I&M Bank after it froze three of his accounts, a move he claimed was unlawful. His law firm, Ogola & Mujera advocates, argued there was no court order compelling it to freeze the accounts. Ogola, who is representing controversial businessman Ben Gethi in the NYS case, is being accused of helping the businessman to launder proceeds alleged to have been stolen from National Youth Service.
The bank agreed to have the accounts unfrozen as the suit progresses, but the law firm has been barred from transferring a disputed Sh26.9 million, pending determination of the case.
Ogola & Mujera sued I&M for freezing its accounts, arguing that there was no court order compelling it to do so at the time Patrick Ogola, a partner at the law firm, instructed it to transfer Sh27 million to Hong Kong for a clothes purchase deal.
I&M Bank also reported the failed transaction to the Financial Reporting Centre, terming it suspicious.
But Ogola says I&M only reported the transaction after he refused to convert the Sh26.9 million at its Parklands branch, following a fallout over exchange rates.
But the lender says a gazette notice linking the law firm to the scam gave it reason to believe that the transaction could be an attempt to launder funds from the Sh791 million theft.
The Assets Recovery Authority wants to join the case, arguing that the amount frozen by I&M could be from the sale of a luxury Range Rover it wants to seize from Ogola.
Prime suspect
ARA holds that Ogola owns the Range Rover, but the lawyer insists he is only in the process of buying it from John Kago, an associate of Gethi, who is also a suspect in the NYS scam. Gethi is a prime suspect in the scandal and is believed to have used his associates and lawyers, including Ogola, to launder stolen money.
ARA holds that Ogola could have sold it to stop it from seizing the vehicle, which is among other assets worth Sh585 million and linked to Gethi that the State agency wants to recover.
According to the bank’s Operation Manager Joseph Njomo, the bank froze the accounts after reporting the suspicious transaction to the Central Bank of Kenya.
Njomo said in court documents that Ogola deposited Sh26.9 million and upon inquiry, he produced a sale agreement dated June 18, 2015, for the purchase of a Sh87 million property.
“Sh30 million had been received by the vendor at the time of signing. Another Sh28.5 million was to be paid 60 days after the signing and the balance was to be paid upon completion,” said Njomo.
According to Ogola, the bank froze his accounts and refused to transfer the aforementioned amount to Hong Kong as requested by him. He said his attempts to find out from the bank why the money had not been transferred were futile.
