Graft war: Agency queries Governor Mike Sonko's Sh500m deposits

By any measure, no one can doubt that Nairobi Governor Mike Sonko is a generous politician who gifts anyone and everyone he comes across.

This benevolence has even caught the eye of sleuths who are giving him sleepless nights after going for his accounts on an allegation that he has been illegally siphoning money from Nairobi County Government, a claim he denies.  

Investigators say in court documents that from his donations, which the public knows, he is a man of means who does not need money in 10 accounts that are now at the heart of a classic war with Asset Recovery Agency (ARA).

The case will now be heard by a third judge.

Sonko wants his accounts unfrozen, saying there is no evidence of crime. He is suffering for lack of money, he says. But the ARA insists there are enough pointers to doubt the source of his wealth.

What hardships?

“It has been in the public domain that the respondent (Sonko) has been philanthropic in making donations which only shows that he is capable of providing for his living expenses, therefore the preservation orders will not cause him any hardship or deprive his means to provide for his living expenses,” the agency’s latest reply to Sonko’s application to lift the freeze orders, reads in part.

The case by ARA first went before Anti-Corruption Court Judge Mumbi Ngugi, who recused herself. It then landed before Criminal Court Judge Luka Kimaru who froze Sonko’s accounts. It will be heard today by Justice Jessie Lessit.

Sonko has six accounts at Equity Bank, three at Diamond Trust Bank, and another at Co-operative Bank which have at least Sh18 million. He also has another account at KCB Bank.

The governor argues that he is a victim of a witch hunt as the orders obtained by ARA are from “mere suspicion” with no cogent evidence.

“There were no specific, pinpointed funds in any or all of my bank accounts to meet the probative threshold of granting such an order other than unsubstantiated suspicions,” Sonko replied.

According to ARA, an analysis of Sonko’s accounts depict a clear case of smurfing, a technique used in money laundering where cash is divided between “smurfs” who make multiple deposits into multiple accounts.

By this, banks cannot detect or suspect that those making deposits are connected to the owner of the account.

The agency now says that although the accounts have at least Sh18 million, the governor received a total Sh553 million between August 2017 and December 2019.

ARA, in its documents seen by The Standard, alleges that on some days, Sonko received huge amounts of money. The law requires banks to demand explanation whenever a person deposits more than Sh1 million in an account.

On August 17, 2017, alone, ARA claims that Sonko got Sh30 million through 24 cash transactions. The agency claims the money ended up in nine accounts in Equity, DTB, Cooperative and KCB.

Data provided to the court by ARA indicate that the least amount Sonko allegedly received on August 17 was Sh175,000 which was deposited in DTB.

The highest amount was in two tranches of Sh5 million each and was equally deposited in KCB and Coop Bank.

Four days later, on August 21, Sonko is claimed to have received Sh8.8 million through 11 cash deposits in three bank accounts held at DTB. In this transaction, the least amount was Sh300,000 and the highest Sh990,000.

Two days later, Sonko is said to have received Sh1 million in dollars at DTB through two cash deposits in two accounts.

On August 25, ARA alleges that some Sh4.8 million was again deposited in DTB and Equity in cash. In DTB, it is alleged that he got $6,200 (Sh620,000) and two transactions of Sh470,000 each. On this day, the agency says DTB got Sh350,000 as the least amount.

In Equity, it is alleged four accounts received an equal amount of Sh900,000 each.

In that August alone, ARA claims, Sonko received Sh45 million in cash in 44 tranches which they alleged are suspicious.

“In August 2017, there were 44 suspicious cash deposits made to the respondent’s bank accounts amounting to Sh45 million and $13,300 and whose total is Sh46 million,” ARA says in its reply dated June 23, 2020.

Suspicious transactions

ARA also details that on September 6, 2017, the governor received Sh10 million in six bank accounts held at KCB, DTB, Cooperative, and DTB, all in six cash tranches.

On September 11, 2017, he is alleged to have received Sh6.1 million, some of which were in dollars.

The money is said to have been deposited in DTB.

Another Sh4.9 million cash was allegedly deposited on September 27, 2017.

ARA caps the transactions for that month at Sh42 million -- Sh17 million was in Kenyan shillings and approximately Sh24 million was in US dollars. 

In October, Sonko is alleged to have received Sh108 million which was deposited in his accounts in cash through 39 transactions. ARA claims he got Sh69 million in Kenya shillings and approximately Sh38 million in dollars.

The agency’s reply also says that in November the same year, Sonko allegedly got some Sh66 million in 21 cash deposit transactions. At least Sh15 million was in dollars.

In December 2017, ARA claims there were 17 suspicious cash deposits which totaled Sh43 million. It is said Sonko received approximately Sh14 million in dollars.

According to ARA, the governor received a total Sh288 million between August and December 2017. Approximately Sh75 million of this was in dollars. For that period, the agency claims, there were 53 suspicious transactions.

In 2018, he is alleged to have received Sh205 million in cash and in 2019, he is claimed to have received at least Sh57 million in 66 cash deposits.

“The above transactions in the preceding paragraphs depict a scheme of money laundering and an attempt to conceal and disguise the source of funds. There are reasonable grounds to believe that the funds held in the respondent’s bank accounts are proceeds of crime liable for forfeiture,” ARA claims. 

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