Under what circumstances is a person considered to have provided a reasonable explanation for property suspected to be proceeds of crime or unexplained wealth?
Must anti-graft agencies establish a clear connection between a specific crime and the money or property they seek to have forfeited to the government?
These are among the key questions the Supreme Court is expected to determine after agreeing to hear a petition filed by the Ethics and Anti-Corruption Commission (EACC) and the Assets Recovery Agency (ARA) against a businesswoman over alleged unexplained wealth.
The apex court presided over by Chief Justice Martha Koome noted that lower courts had taken divergent approaches on the issue of forfeiting unexplained wealth, necessitating legal clarity from the highest court.
“Clearly as demonstrated above, these issues have not been settled either by the Court of Appeal or this Court,” the Supreme Court said in a ruling dated May 30.
Justices Koome, Philomena Mwilu, Smokin Wanjala, Njoki Ndung’u and William Ouko further observed that the main objective of forfeiture proceedings in the context of combating corruption, economic crimes and money laundering goes beyond the interests of the immediate parties and has broader implications for society.
The appeal arises from a case involving EACC and ARA against Ms Pamela Aboo, a businesswoman accused of holding Sh19.6 million in unexplained wealth.
The two agencies claimed that Ms Aboo's bank accounts were used to deposit and transfer bribes allegedly received by her husband, a Kenya Revenue Authority (KRA) officer who works in the customs department.
EACC and ARA initially won the case at the High Court which directed Ms Aboo to forfeit the Sh19.6 million to the State.
However, she successfully appealed the ruling after the Court of Appeal held that the anti graft agencies failed to provide sufficient evidence linking the money to any specific criminal activity.
Ms Aboo defended herself by arguing that the funds were proceeds from various legitimate businesses, including a transport venture in Mombasa that is run with a partner as well as sales of bananas, sugarcane, cereals and perfumes.
The Supreme Court said it would also address the issue of evidentiary burden specifically, whether the burden shifts to the person in possession of suspicious assets to explain their source, and if so, at what stage in the proceedings.
According to ARA, the deposits in Ms Aboo’s accounts were made in cash tranches ranging between Sh30,000 and Sh400,000, mostly at Equity Bank’s Kenya Ports Authority (KPA) Branch in Mombasa and through Mombasa-based bank agents.
Notably, there were no corresponding withdrawals which raised suspicions that the money could be illicit.
ARA argued the pattern was consistent with attempts to launder bribes allegedly received by her husband during his tenure at the KRA.
The High Court had ruled that Ms Aboo's explanation regarding the source of the funds citing her multiple businesses was not credible.
However, the Court of Appeal reversed that decision stating that ARA bore the legal burden of proving the funds were proceeds of crime once Ms Aboo offered an explanation.
The appellate court further faulted ARA for failing to include Ms Aboo’s husband in the case given his alleged connection to the funds.
