Police, KRA bust intricate web of ethanol smuggling from Uganda

The authorities in Western Kenya have uncovered a network of ethanol smuggling and counterfeit alcohol production.

Officials involved in the crackdown on the illegal trade reveal that ethanol is smuggled into Kenya from Uganda via the Lwakhakha border.

The smuggled ethanol is often transported to unlicensed distilleries, where it is used to produce second-generation alcohol—cheap counterfeit drinks labelled with fake excise stamps.

These illicit products not only create unfair competition for legitimate businesses but also deprive the government of crucial revenue.

“The smuggling of ethanol disrupts market dynamics, giving unscrupulous traders an unfair advantage over legitimate businesses,” said a senior official from the Kenya Revenue Authority (KRA).

“This undermines both economic stability and public health, as counterfeit alcohol poses serious risks to consumers,” he added.

The illicit alcohol trade is deeply entrenched, with more than 60,000 litres of smuggled ethanol intercepted last year alone. Such operations underscore the scale of the problem.

In the most recent incident, Abraham Kimungui, a member of the Bungoma County Assembly, sustained gunshot wounds after engaging in a violent confrontation with police and KRA officials, following the impounding of a lorry carrying 8,750 litres of suspected ethanol.

According to the police, the MCA attempted to forcibly drive away the lorry, resulting in a standoff between a mob and the authorities, who were forced to fire into the air.

The smuggled ethanol was valued at Sh26 million, representing a loss of Sh14 million in tax revenue.

On 25 August 2024, a joint operation by KRA’s investigations department and the Directorate of Criminal Investigations uncovered a sophisticated smuggling operation involving 40,971 litres of ethanol worth Sh26.9 million.

The consignment, intercepted in Limuru, was concealed in tankers disguised as molasses transporters.

Investigators discovered that while the main compartments of the tankers contained just 2,720 litres of molasses, hidden compartments were filled with ethanol. Advanced scanning and forensic tests confirmed the presence of the illicit substance, an estimated tax loss of Sh20.5 million.

One suspect, Edward Nandwa Otundo, was arrested, while the owner of the trucks, Isaac Muigai Kahugu, and another driver remain at large.

In a separate operation at the Lwakhakha Border Station, customs enforcement officers seized 7,500 litres of ethanol concealed beneath two tonnes of oranges. The truck driver escaped arrest, abandoning the vehicle.

Authorities estimate that unpaid customs duties and taxes on the consignment amount to approximately Sh4 million.

KRA is implementing a multi-faceted strategy to combat smuggling and illicit trade. These measures include advanced cargo scanning, bolstered border security, and collaborations with local security committees. Intelligence-sharing and targeted investigations have led to numerous seizures and arrests.

“We urge the public to report suspicious activities and share intelligence to help dismantle these cartels,” the KRA official said.