Sh1b worth of assets recovered from Devani

By Wahome Thuku

The Kenya Commercial Bank has recovered assets worth more than Sh1 billion from fugitive businessman Yagnesh Devani.

And now the State is working to change criminal charges against Devani, to reflect the recovery made from seizure of his property in Kenya.

Senior State Prosecutor Victor Mule told a Nairobi court that they had recovered "substantial amounts" from Devani and his Triton Oil Company. He was applying for adjournment in a criminal case against Devani and his business associates.

And though the prosecutor did not inform the court the exact worth of the assets, other sources put the figure at around Sh1.5 billion, which is just a portion of what Devani is wanted for.

"We now need a month to amend the charges to reflect this recovery," Mule told Chief Magistrate Gilbert Mutembei.

Devani, in custody in the UK, is wanted in Kenya to face a series of charges over the Sh7.6 billion Triton Petroleum scandal.

He and his four co-accused and Triton Petroleum Company are facing charges in five different cases, ranging from conspiracy, stealing, failing to prevent a felony and fraudulent disposition of mortgaged goods.

The case will be mentioned in court in November.

The oil scandal broke in January 2009, but the offence was committed in 2008. By the time it became public, Devani was already out of the country.He came to the limelight in 2009 when news of the Triton oil saga hit the headlines following allegations that fuel worth close to Sh8 billion had disappeared.

He is alleged to have masterminded the scam, which also unearthed serious weaknesses in the country’s oil import system dubbed open tender system (OTS).

Huge risks

The deal between KPC and Triton, dating back to 2004, generated one of the biggest financial scandals. Forensic audits showed it exposed KCB and the PTA Bank to huge risks after a massive oil import worth billions of shillings financed by both banks through letters of credit vanished into thin air from the Kipevu Oil Storage Facility in Mombasa, owned by the Kenya Pipeline Company (KPC).

The oil was being held at the facility in trust for financiers and marketers. The paper trail, according to the KACC charge file, showed the oil was secretly sold to several oil marketers in the country. Triton had won the tender to import oil under the OTS.

Both KCB and PTA Bank were unaware of the others’ involvement in the cunningly executed collateral financing by Triton that amounted to some form of cheque kiting, where the oil firm ‘borrowed from Peter to pay Paul.’

Devani and his co-accused are alleged to have take advantage of the OTS, introduced in 2003, to allow non-major oil marketers to import the country’s monthly oil requirements.

Devani fled the country following the busting of the scandal, and the Government sought help from Interpol to track him down. The wealthy businessman was then charged in absentia.

The extradition of Devani from the UK is now being used by the Kenya government as the carrot for it to hand over Nambale MP Chris Okemo and Samuel Gichuru, the former managing director of Kenya Power and Lighting Company (KPLC) who are wanted in the British territory of Jersey to face charges of laundering proceeds of corruption.

Devani was arrested in the UK in May, this year and extradition proceedings started following a request of extradition from Kenya Government.