Trader files Sh27m fraud suit against Chinese company
By Dominic Omondi
| Sep 25th 2020 | 2 min read
A Kenyan distributor of natural health products has accused a Chinese company of defrauding her of Sh26 million.
Elizabeth Okelo has filed a case in court, accusing Longliqi Global Holdings Company of supplying her with kitchen tables and household items of iron and steel instead of the medical items that they had agreed she would be distributing on behalf of the firm in Kenya, Uganda and Rwanda.
She also accused the company and its local subsidiary of presenting fraudulent documents to her bankers purporting them to be genuine and wanted the court to freeze the Chinese firm’s bank accounts as she fights to get a refund.
Longligi Global Holdings, which is registered in China, is the manufacturer of natural health and medical supplements commonly known as Longliqi or Longrich.
Besides being supplied with the wrong goods, Okelo told the court that she also found that some of the items she ordered were missing and the details of the goods in the import declaration forms were different from what she ordered and paid for.
She asked High Court Judge David Majanja to issue a freeze order on Longligi’s accounts at the Ecobank Kenya and Stanbic Bank Kenya to the tune of $240,740.12 (Sh26 million), the money she paid for the products.
However, Justice Majanja dismissed her request, noting that she had not demonstrated that Longliqi International (Kenya) Ltd planned to leave the country.
“Even if I accept that the defendants engaged in fraudulent conduct, it is clear that even after perpetrating the fraud, (they) did not take off from the country or do anything to show that they were in the process of leaving the country with a view to obstructing any decree that may be passed by the court in favour of the plaintiff,” said the judge in a ruling on September 22.
He said that while there was a strong case of fraud against Longliqi Global Holdings and its local subsidiary, the complainant had the onus of providing evidence that the Chinese company intended to dispose of the assets and leave the country with the intention of defeating the claim.
According to court documents, Okelo had two agreements on November 11, 2018, with Longliqi Global Holdings and Longliqi International (Kenya) in which she was appointed an exclusive super-stockist of Longrich products in Uganda and Rwanda.
The Kenyan subsidiary issued invoices to Okelo for the purchase of the products, which she paid for by transferring $115,198.25 (Sh12,441,411) and $125,541.87 (Sh13,558,522) directly to Longliqi Global Holdings’s account in China.
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