A Nigerian firm that was at the centre of a multi-billion money laundering probe last year used fake documents to wire millions of dollars from Kenyan banks to American bank Citibank.
RemX Limited, which was investigated by the Assets Recovery Agency (ARA) on fears of card fraud and money laundering and later cleared, duped the bank’s compliance teams and Kenyan regulators using fake agreements, disclosures in a new case filed by Hong Kong-based firm at the High Court has revealed.
Whatsapp group messages among RemX and Lae Technologies Hong Kong Limited representatives filed in court have exposed how the payments service company forged documents to move billions of cash without raising suspicion for four years.
Lae Technologies wants the High Court to freeze RemX’s accounts and its affiliates pending the determination of a suit seeking payment of $88 million as the balance for software sold to the Nigerians.
Documents filed in court reveal a series of text messages from Nehikhare Eghosasere—a RemX director– sharing details of how they dodged regulatory dragnet to move huge sums of money in and out of the country through Kenyan banks and Citibank.
“To prevent probing questions from Citibank’s compliance team, we will need to ensure that the paper work is super super tight. Typically, how we have circumvented this in the past is to ensure that the beneficiary name in the SWIFT instruction is the same as the sender’s name. That’s why we have RemX set up in multiple countries so that it’s seen as “Same Company Funds Transfer”,” Mr Eghosasere said in a Whatsapp message dated October 9, 2020.
Nigerian company registry shows RemX is registered in the names of Nehikhare Eghosasere and Demuren Olufemi Olukunmi, with its offices on 16C Ruxton Road, Ikoyi, an island in Lagos, the commercial capital of Nigeria.
The Kenyan entity under the same name is owned by Mr Eghosasere with 200 shares and Demuren Olufemi Olubukunmi who holds 800 shares, according to information available in the Business Registration Service online portal.
The intended purpose of the transactions is not clear in the series of exchanges but ARA last year cited the company for moving illicit money that could have been proceeds of crime.
“… just want to put measures in place to ensure it’s sustainable and doesn’t become problematic down the line when Citibank starts asking questions. They would usually come to ask questions in 1-2 years after the transaction lol. They are such an annoying bank. If we have some sort of dummy agreement with the trust. Just to present to Citibank (whenever they ask questions), that will be great,” Mr Eghosasere told his would-be partners.
The two together with Olubunmi Akinbanjo Akinyemiju have cross-continental operations and have multiple companies registered in Kenya, the US, UAE and Nigeria.
The Lagos-based payments firm and other companies registered under the same names received over Sh84 billion and wired out Sh78 billion between 2019 and last year through Equity Bank and UBA, ARA investigations showed.
Their other companies that were part of last year’s probe and have been listed as interested parties in the latest court fight include Pumicells Ltd, OIT Africa Ltd, Avalon Offshore Logistics Ltd, RemX Capital Ltd and Multigate Limited.
Equity Bank and UBA Bank could find themselves in trouble following the revelations that the firm used fake agreements to move billions, failing the Know Your Customer (KYC) requirements meant to curb the flow of illicit cash and money laundering.
Kenyan banks are expected to alert the Financial Reporting Centre (FRC) of suspicious transactions under anti-money laundering laws, including reporting large transactions and undertaking due diligence on customers.
ARA has since withdrawn the case against RemX which saw the High Court lift orders to unfreeze Sh5.6 billion belonging to the firm.
The transactions into Kenya were done through multiple dollar accounts held at Equity and UBA. However, the funds sent to the US were wired from Equity through Citibank as the correspondent bank.
Mr Eghosasere in the exchanges said local banks did not pose any risk to their operations but Citibank had strict anti-money laundering (AML) rules which could land them in problems.
“Equity Bank is the sending bank, but Citibank is the correspondent bank. And they (Citibank always give the sending (and receiving banks) “headache”,” Mr Eghosasere told the group.
The documents have also revealed that before flying into regulatory turbulence last year, the Nigerians were keen on making Kenya their payment settlement hub which could partly explain the outsized amounts of foreign currencies wired during the period.
“RemX typically moves money globally around the world. We are currently looking to set up our settlement hub in Kenya, but they need us to get a remittance license anywhere else in the world… Makes sense? So, we just need a license in the easiest jurisdiction,” Mr Eghosasere.
The CBK and the Financial Reporting Centre —the agency that tracks illicit money—have maintained in the past that the transactions by the firms were illegal and the firms are not authorised to process payments in Kenya.
UBA and Equity Banks are currently embroiled in a legal tussle with Assets Recovery Agency (ARA) over Sh5.6B frozen in the two banks suspected to being proceeds of crime and a dark world money laundering scheme.
According to reports, the money is alleged to be linked to Deputy President William Ruto and in play are two Kenyans and two Nigerian nationals named in several money laundering schemes before.
The billions in the accounts in Equity Bank and UBA Bank were frozen by the High Court after the Assets Recovery Agency (ARA) applied to block the transfer or withdrawal, pending the filing of a petition to have the money forfeited to the government.
The money was wired into the country from multiple countries, including Nigeria, to three companies identified as OIT Africa Ltd, Avalon Offshore Logistics Ltd and RemiX Capital Ltd.
The ARA says the four directors of the firms—the two Nigerians and two Kenyans—shrugged off repeated summons to explain the source of the billions.
The State agency believes the two Kenyans, including one who graduated from a local public university in 2018, are fronts of the Nigerians who are suspected to have the backing of Ruto.
Equity Bank and UBA Bank (account number 5501030010886) could also find themselves in trouble following revelations that the suspicious billions started flowing into the accounts in 2020.
OIT Africa had Sh4.8 billion in two Equity accounts and one in UBA. Avalon Offshore Logistics had Sh43.5 million in two Equity accounts, while Remix Capital had Sh765 million in one UBA account.
A search at the registrar of companies revealed that Avalon Offshore is owned by Nigerians Jeffrey Nnaoma Michaels and Uduma Okoro Christopher Kalu. The company was registered in November 2020 and has its address in Westlands.
Both Kalu and Nnaoma are listed as directors of the company, with Kalu holding 1,600 ordinary shares while the rest are owned by his partner.
An online search reveals that Nnaoma is listed as a director of several companies registered in Nigeria, including a forex bureau.
The post office number of the two Nigerians was linked to several firms that operate from the 13th floor of the prestigious Delta Corner office block in Westlands.
OIT Africa is owned by Vionnah Akoth Odongo and Kenneth Odongo Raminya, with 500 shares each and the company was registered on July 14, 2017.
OIT Africa informed the registrar of companies that it operates from 680 Plaza, the building that hosts the 680 Hotel.
The mobile number is registered under the name of a different person, who denied knowledge of OIT Africa and Ms Odongo and Mr Raminya.
There is no record of any company by the name Remix Capital Limited in the Business Registration Service online portal, an indication that the firm could be non-existent.
Court documents state that transactions involving the Sh5.6 billion were conducted through suspicious transfers and withdrawals meant to hide the source.
The ARA says that it suspects that the money could be proceeds of crime because the transactions were conducted suspiciously through six bank accounts in Equity and UBA.
The agency says there is imminent danger that the funds might be transferred or withdrawn unless the court issues an order preserving the money.
Documents filed by the companies earlier seeking to stop the investigations state that they are an online remittance platform, which allows individuals from abroad to send money to their loved ones in Nigeria and Kenya.
The case was later withdrawn after they failed to block the probe.
The agency moved to court in March, seeking to investigate the three companies suspecting that they were involved in money laundering.
Justice Esther Maina barred the companies and their agents from withdrawing or transferring the money, pending the hearing of a petition by the ARA.
UBA Chief Executive Officer (CEO) is Chike Isiuwe, a Nigerian. The bank board chairman is Alphan Njeru.
United Bank of Africa Kenya CEO Chike Isiuwe at the lender’s offices on February 1, 2022. (UBA) Kenya CEOChike Isiuwe at the lender’s offices on February 1, 2022.
Apart from Isiuwe, top bank managers in hot soup are Mary Mulili, Evah Wahogo (Chief Operating Officer), John Oganda (Head of compliance), Debra Ogada(Country Head legal and company secretary) and Geoffrey Kimani (Head risk management).
The investigations by chain implicates the entire management and detectives will comb through the files of many. The international money laundering syndicate, it has emerged that the bank deposits started in 2020.
In November 2020, Deputy President William Ruto met with a controversial man on the run alongside former Nigerian vice-president Atiku Abubakar during his highly guarded trip to the emirate of Dubai.
The DP met Abubakar alongside one Timi Frank.
Mr Frank, a high-flying but controversial political activist, is wanted in Nigeria on various accusations of character assassination.
Nigeria’s Federal Inland Revenue Service in 2019 announced that it was suing him over a series of fraud allegations he made against the agency, while the current Nigerian vice-president Yemi Osinbajo last year announced that he was suing Mr Frank for defaming him by making corruption allegations against him.
Before his travel to Dubai, Mr Frank had visited Nairobi where he met with DP Ruto and organized the meeting with Abubakar. It is this meeting that intelligence sources suspect a money laundering scheme was crafted.
Mr Frank is a close associate of Mr Atiku, a fabulously wealthy former Nigerian vice-president who has been described by his former boss, President Olusegun Obasanjo, as “not trustworthy” and other not very kind terms.
Mr Abubakar is a wealthy Nigerian with vast investments in oil, but President Obasanjo, in his 2014 biography My Watch, described him in unsavoury terms.
“What I did not know, which came out glaringly later, was his parental background, which was somewhat shadowy, his propensity to corruption, his tendency to disloyalty, his inability to say and stick to the truth all the time, a propensity for poor judgment, his belief and reliance on marabouts (religious teachers), his lack of transparency, his trust in money to buy his way out on all issues, and his readiness to sacrifice morality, integrity, propriety, truth and national interest for self and selfish interest.”
Mr Atiku publicly fell out with President Obasanjo and even decamped from then ruling People’s Democratic Party to the Action Congress of Nigeria, but lost the 2007 presidential election, which was won by the now-deceased Umaru Yar’Adua.
Abubakar had promised to fund the ‘Hustler Nation’ campaigns.
Both Dr Ruto and Mr Atiku have political aspirations. Dr Ruto will be taking a stab at the presidency in 2022, while Mr Abubakar is the candidate for the People’s Democratic Party (PDP) in the Nigerian presidential race a year later, in 2023.
In February, the High Court ordered the freezing of Sh227 million that was recovered from a man associated with Deputy President William Ruto’s United Democratic Alliance (UDA).
Monies in US dollars were intercepted from one Andrew Kipkemboi at the Jomo Kenyatta International Airport cargo shipping point as he arrived in the country from Bujumbura, Burundi, last Thursday.
The DP’s office distanced itself from the man who is said to be eyeing the Chesumei parliamentary seat in Nandi County on a UDA ticket. Sources however claim that the money was linked to the DP.
UDA party office also denied knowledge of the man, insisting the party is yet to go through the list of all individuals who have declared interest for parliamentary seats on its ticket.
According to a local newspaper, investigations further want to unravel the period the UBA bank has been engaged in clearing billions of shillings in the height of 2022 elections. It is claimed that the bank has been used by powerful politicians to launder billions of shillings.
The paper further claims that a senior sitting on CBK board with connections to a senior state official who has since fallen out with the high powers, was commanded to cushion the bank from any troubles given his position at CBK.
Ms Viola Achola who’s in her 20s and the listed as the director of Oit Africa Limited, the firm under probe, she’s claimed to be close to the wife of mentioned CBK board member.
Kenya Insights reached out to the bank on the above mentioned claims but they didn’t comment citing court orders.
Equity Bank
In August last year, Equity Bank found itself in similar circumstances that UBA is in today following claims that they were part of an alleged Sh15B money laundering scheme.
The state’s intelligence had intercepted and arrested a Turkish businessman Harun Aydin from flying out of the country to Uganda where he was to establish a vaccine making plant. According to intelligence at the time, Aydin was supposedly being used by the Deputy President William Ruto to cycle through a money laundering scheme.
The DP didn’t distance himself from his relationship with the flagged businessman.
Speaking during an interview with a local radio station yesterday, Ruto claimed he had helped Aydin to acquire a Sh15 billion loan from Equity Bank to set up a vaccine processing factory in Uganda, which he and three other businessmen alongside his close allies were scheduled to commission on Monday.
“I helped him on one phone call. He said the benefits Ugandans will get are the same that Kenyans will get.”
Many questioned as to how simple it is for Equity to dish out Sh15B as a loan merely from a phone call and to foreigners whose past are questionable.
Claim by Ruto that he secured the loan of such magnitude by simply placing a call has elicited reactions from Kenyans who’ve been victims of banks collapsing in insider, fraudulent loans.
Aydin was deported to Turkey following negotiations between the two states. The controversial businessman had been linked to terror activities before.
Nigeria
A Nigerian court in November last year, had charged regulatory bodies to withdraw the licences of the banks including UBA fir aiding aiding fraud which benefitted from the proceeds of illegal transactions.
Justice Okon Abang of the Federal High Court, Abuja berated The United Bank for Africa, UBA, and Fidelity Bank Plc for aiding fraud, while handing down judgement in a case of N2billion fraud involving a former chairperson of the defunct Pension Reform Task Team, PRTT, Abdulrasheed Maina noted that UBA and Fidelity Bank Plc which were used by Maina as “conduit” to defraud pensioners ought to have been charged alongside Maina. He stated that, “UBA and Fidelity Bank provided the channels with which the convict Mr Maina used in defrauding the federal government.”
The Judge said the banks abdicated their responsibilities by failing to carry out due diligence to establish the true identities of persons in whose names Mr Maina opened and operated the fictitious bank accounts.
In the instance UBA Kenya, did they conduct a due diligence on the flagged account/client? It must be noted that like an ocean, there’s always a ripple effect.
According to an American investigative body, The Sentry, weak financial institutions has made it possible for Kenya to become an epicenter of money laundering. Banks, real estate firms have been singled out. KCB has been on the receiving end for allegedly aiding the money laundering from the bloodshed South Sudan.
Locally, numerous banks have been found guilty of engaging in the illicit activity. However, the Vice has never stopped simply because the banks are treated to a slow motion slap on then wrist with paltry fines that can’t shake a leaf. If CBK grew bigger balls and slapped heavy fines, hold individual rogue managers responsible sending them to jail, and ultimately denying such fraud banks licenses, maybe they’d listen but until then, more money laundering headlines will keep hitting your headlines.
Money laundering, according to authorities, seeks to hide the source of money believed to have been obtained illegally, by passing it through channels including commercial transactions and other forms of investment.
According to the Financial Reporting Centre, such schemes seek to hide and legalise the funds without catching the attention of authorities and also making sure all connections of the funds to criminal activities is removed.
Finally, the “cleansed” money returns to the owner in an indirect way, and is used for legitimate purposes.
According to the United Nations Office on Drugs and Crime (UNODC) about Sh200 trillion is laundered globally every year.
Banks and agencies tasked with fighting the flow of illicit cash must step up their efforts to protect the country from criminal elements.
United Bank of Africa(UBA) Kenya is in trouble following accusations made by the Assets Recovery Agency that the bank hold Sh5B that they deem was acquired illegally through unethical banking practices, money laundering.
In a Miscellaneous Criminal Application No E015/2022 filed on March 10, the agency had sought from the Milimani Anti-Corruption Court to investigate the bank for the offense of money laundering.
The court issued the orders which now puts the bank in full probe.
By allowing the authority to conduct its investigations, the court wants the bank to restrict for at least 45 days account number 5501030010886 under the name Oit Africa Limited held at the same bank from doing any transactions to allow the investigating officer Issac Nakitare to access and obtain information on that account.
ARA seeks the bank’s corporation to retrieve crucial for the investigations including information on when the account was opened, bank statements since the account was opened, cheques/cash deposits and withdraws and bank RTGS/swifts transfers and other relevant info that would aid the probe.
ARA is also seeking to compel UBA managers to authorise and give the investigating officer electrically produced evidence to be used in court.
The officer said there was compelling ground for the suspicion of the account being used in money laundering.
Nakitare swears in the affidavit that on March 4, 2022, ARA received information that the said bank account had transacted and holding funds suspected to be proceeds of crime and the agency opened an Inquiry file No 14 of 2022 to investigate and inquire into activities in this account for the offences of money laundering leading to proceeds of crime.
The money in question is suspected to be over Sh5B.
The investigating officer also noted in his sworn affidavit that the bank account is being investigated for several other offenses, including money laundering and crime proceeds.
According to the affidavit seen by Kenya Insights, it is necessary to enable him complete the investigations aimed at instituting ARA and Forfeiture Proceedings.
The officer believes his work will help to collate confirmatory evidence regarding the financial flow as of the allegations.
The officer also held fears that the funds held in the flagged account may be withdrawn, transferred, spent or dissipated rendering the application and intended recovery of proceeds of crime nugatory.
UBA Kenya CEO,Chike Isiuwe.
Chike Isiuwe was appointed in August last year appointed the chief executive, replacing Kehinde Omirinde who had been serving as acting CEO of the bank, which began operations in Kenya in 2009. It is a subsidiary of UBA Plc.
Isiuwe joined the UBA-Kenya from UBA Group in Nigeria, where he was the deputy general manager – Corporate Banking Directorate.
The investigations by chain implicates the entire management and detectives will comb through the files of many.
According to a local newspaper, investigations further want to unravel the period the bank has been engaged in clearing billions of shillings in the height of 2022 elections.
The paper further claims that a senior sitting on CBK board with connections to a senior state official who has since fallen out with the high powers, was commanded to cushion the bank from any troubles given his position at CBK.
A Ms Viola Achola who’s in her 20s is reportedly listed as the director of Oit Africa Limited, the firm under probe, she’s claimed to be close to the wife of mentioned CBK board member.
Kenya Insights reached out to the bank on the above mentioned claims but they didn’t comment citing court orders.
KEMSA
Elsewhere, It is not unusual not unusual for the big boys to use proxies in executing their missions. One of the most prominent cases in the recent cases is that of Ms Zubeda Nyamlondo, a proxy director of Aszure Commercial Services a company implicated in a Sh347M scandalous tender to supply facemasks to the Kenya Medical Supplies Authority (Kemsa).
Ms Zubeda Nyamlondo.
Nyamlondo who was casually dressed in a jungle green dress, a red marvin hat and a matching face mask when she appeared before the Public Investment Committee (PIC) took the committee in circles, at times contradicting herself and prompting members of the watchdog to conclude she could be a proxy to some powerful individuals.
Equity Bank
In August last year, Equity Bank found itself in similar circumstances that UBA is in today following claims that they were part of an alleged Sh15B money laundering scheme.
The state’s intelligence had intercepted and arrested a Turkish businessman Harun Aydin from flying out of the country to Uganda where he was to establish a vaccine making plant. According to intelligence at the time, Aydin was supposedly being used by the Deputy President William Ruto to cycle through a money laundering scheme.
The DP didn’t distance himself from his relationship with the flagged businessman.
Speaking during an interview with a local radio station yesterday, Ruto claimed he had helped Aydin to acquire a Sh15 billion loan from Equity Bank to set up a vaccine processing factory in Uganda, which he and three other businessmen alongside his close allies were scheduled to commission on Monday.
“I helped him on one phone call. He said the benefits Ugandans will get are the same that Kenyans will get.”
Many questioned as to how simple it is for Equity to dish out Sh15B as a loan merely from a phone call and to foreigners whose past are questionable.
Claim by Ruto that he secured the loan of such magnitude by simply placing a call has elicited reactions from Kenyans who’ve been victims of banks collapsing in insider, fraudulent loans.
Aydin was deported to Turkey following negotiations between the two states. The controversial businessman had been linked to terror activities before.
Nigeria
A Nigerian court in November last year, had charged regulatory bodies to withdraw the licences of the banks including UBA fir aiding aiding fraud which benefitted from the proceeds of illegal transactions.
Justice Okon Abang of the Federal High Court, Abuja berated The United Bank for Africa, UBA, and Fidelity Bank Plc for aiding fraud, while handing down judgement in a case of N2billion fraud involving a former chairperson of the defunct Pension Reform Task Team, PRTT, Abdulrasheed Maina noted that UBA and Fidelity Bank Plc which were used by Maina as “conduit” to defraud pensioners ought to have been charged alongside Maina. He stated that, “UBA and Fidelity Bank provided the channels with which the convict Mr Maina used in defrauding the federal government.”
The Judge said the banks abdicated their responsibilities by failing to carry out due diligence to establish the true identities of persons in whose names Mr Maina opened and operated the fictitious bank accounts.
In the instance UBA Kenya, did they conduct a due diligence on the flagged account/client? It must be noted that like an ocean, there’s always a ripple effect.
According to an American investigative body, The Sentry, weak financial institutions has made it possible for Kenya to become an epicenter of money laundering. Banks, real estate firms have been singled out. KCB has been on the receiving end for allegedly aiding the money laundering from the bloodshed South Sudan.
Locally, numerous banks have been found guilty of engaging in the illicit activity. However, the Vice has never stopped simply because the banks are treated to a slow motion slap on then wrist with paltry fines that can’t shake a leaf. If CBK grew bigger balls and slapped heavy fines, hold individual rogue managers responsible sending them to jail, and ultimately denying such fraud banks licenses, maybe they’d listen but until then, more money laundering headlines will keep hitting your headlines.
Money laundering, according to authorities, seeks to hide the source of money believed to have been obtained illegally, by passing it through channels including commercial transactions and other forms of investment.
According to the Financial Reporting Centre, such schemes seek to hide and legalise the funds without catching the attention of authorities and also making sure all connections of the funds to criminal activities is removed.
Finally, the “cleansed” money returns to the owner in an indirect way, and is used for legitimate purposes.
According to the United Nations Office on Drugs and Crime (UNODC) about Sh200 trillion is laundered globally every year.
