How Devani walked free from Sh7.6bn Triton scam

Yagnesh Devani, Controversial billionaire and oil tycoon | File Standard

In a shocking twist to one of Kenya’s largest corporate fraud cases, controversial billionaire and oil tycoon Yagnesh Devani has walked free.

Sixteen years after orchestrating a scheme to syphon millions from Kenya's oil reserves through Triton Petroleum, Devani no longer faces charges, with the courts declaring he has no case to answer.

The decision, delivered by Anti-Corruption Magistrate Harrison Barasa, followed an application by Director of Public Prosecutions Renson Ingonga to withdraw the case.

The ruling pointed to a lack of key testimonies and witnesses, including that of former Energy Minister Kiraitu Murungi, and the death of critical witnesses, rendering the case virtually dead.

During the peak of the scandal peak in 2008, Murungi was Energy Minister, while Patrick Nyoike served as Permanent Secretary. Kenya Pipeline Company (KPC), led by Managing Director George Okungu, enabled Triton to withdraw oil without full payment—an opening Devani allegedly exploited to illegally sell off oil reserves.

Despite their offices placing them around the circumstances of the Triton affair, these individuals did not testify, court records show. 

Petrocity Energy Kenya’s General Manager, Peter Mecha was then KPC’s General Manager of Operations. As Operations boss at KPC, Mecha played an integral role, responsible for placing oil orders, monitoring the country’s reserves, and advising on fluctuating oil needs—essentially, the technical expert who would have detailed knowledge of the product's flow. His testimony appears not to have been called.

Triton, a licenced oil importer back in 2008, was allowed by the Kenya Pipeline Company (KPC) to collect oil without fully paying for it, and this is the loophole that Devani allegedly exploited to withdraw oil stored by KPC, selling it off and pocketing the proceeds.

Kiraitu, the then man in the government's driver's seat and considered a crucial witness in the case, the DPP said was unwilling to cooperate, significantly weakening the prosecution's position and leading to its collapse.

In the infamous saga, banks and oil companies backed Triton with financial guarantees, but as Devani sold the oil, he allegedly failed to settle his debts, plunging the companies into massive losses, amounting to around Sh 7.6 billion.

The Petroleum scandal sucked in a wide network of individuals and institutions from both within and outside government and exposed major weaknesses in Kenya’s energy sector.

Allowing the DPP his prayers on Monday, Magistrate Barasa noted that the prosecutors and the Ethics and Anti-Corruption Commission (EACC) could not be compelled to proceed with it, especially when key witnesses had become uncooperative.

On October 9, the DPP, represented by Senior Prosecution Counsel Elphas Ombati, made an oral application to terminate the case.

This request follows the DPP's earlier recommendation for prosecution after Devani's repatriation from the UK, where he had been on the run for 16 years.

"I urge this court to withdraw the case against the accused persons, as the prosecution has encountered difficulties in tracing witnesses," the prosecutor stated.

The defence lawyers did not oppose the DPP's application. Initially, the magistrate acknowledged the case's public interest and declined to drop the oral application by the DPP and required an affidavit to be filed before making a determination.

He emphasised that the case is of great public interest and cannot be withdrawn without substantial reasons.

Some legal minds like Alutalala Mukhwana, an advocate of the High Court of Kenya see a “tragic loss to the integrity of the nation”.

“In public service there is something called perpetuity of succession, that even if something happened in the 60s, there has to be some thread that connects that to the present, therefore the only people that change are the office holders, it cannot be lost that Kenyans are on the losing end,” he told The Standard.

DPP Rensong Ingonga said Kiraitu Murungi, one of the key witnesses, was unwilling to cooperate, significantly weakening the prosecution's position and leading to its collapse.

In his affidavit seeking to drop the case, the DPP outlined several reasons for withdrawal, including the deaths of some witnesses and Kiraitu's reluctance to testify.

The DPP tendered a letter in court between EACC and Kiraitu here the former Energy Minister declined to testify in the corruption case against Devani, contributing to the collapse of the Multi-billion oil scandal.

Kiraitu stated he would not attend, having already testified in the case against Devani co-accused 13 years ago.

He emphasised, "I support the pursuit of justice, but respectfully, I don't think this is a reasonable request. I provided my evidence over a decade ago! Where have they been? Why seek to recall me for cross-examination after all this time?"

Kiraitu further asserted, "As a witness, I have the right to be treated fairly and to give evidence without undue delay. Consequently, I am not available for any further attendance in this case."

According to Kiraitu, the prosecutor should strongly object to the request for recall, as it appears to abuse the court process and is intended to delay the conclusion of the case.

Furthermore, efforts to locate the main complainant, the Emirates CEO, had proven futile, with the only available information indicating that he had relocated to Singapore.

The magistrate said that from the affidavit, the EACC, which was the investigative agency in the case, was duly consulted in regards to the withdrawal application.

In his decision, the magistrate took into account the DPP's submissions, which indicated that they lacked sufficient evidence to sustain the case.

Citing Article 157(8) of the Constitution, which requires the DPP to consider public interest and the administration of justice, Barasa acknowledged the need to prevent abuse of the legal process.

Ultimately, the magistrate granted the application under Section 87(a) of the Criminal Procedure Code, meaning that while Devani has been acquitted for now, he could still face prosecution in the future if new evidence emerges.

"At this juncture, it would be preposterous for this court to proceed. We would be forcing the agencies to continue a case when they have made it clear they lack sufficient evidence to sustain it," Barasa stated.

The magistrate said he found no compelling reason to withdraw the matter.

"Consequently, I allow the application and proceed to discharge the accused person under section 87a of the criminal procedure code," Basara ruled.

Devani faced eleven counts of fraud, including conspiracy to defraud, obtaining by false pretenses, and the fraudulent disposition of mortgaged goods.

The court also ordered the Sh 5 million cash bail refunded to him.

Devani was charged in July after detectives from the Ethics and Anti-Corruption Commission (EACC) arrested him following a recommendation for trial over the oil scam that occurred two decades ago.

The 2008 oil scandal surfaced when the Kenya Pipeline Company (KPC) ordered an internal audit of oil stocks due to complaints from oil marketers and financiers about a nationwide fuel shortage.

An audit conducted in July 2009 by the African Centre for Open Governance revealed that 126.4 million liters of oil were irregularly and illegally released to Triton Petroleum Limited between November 2007 and November 2008.

The audit indicated that Triton was not entitled to the stocks, and the release was not authorized by financiers as required under contractual arrangements.

After fleeing Kenya in 2008, Devani was subject to a warrant of arrest issued in September 2009, prompting the Kenyan government to initiate extradition proceedings to bring him back from the United Kingdom.

This is even after Devani challenged his return to Kenya abroad, where he sought to avoid facing multiple criminal cases against him and his co-accused.

All his challenges against extradition were dismissed by the UK Court of Appeal in the case of Secretary of State for Home Department vs. Yagnesh Mohanlal Devani (2020) EWCA Civ 612, with the judgment delivered on May 7, 2020.

After 16 years as a fugitive, Devani was extradited to Kenya on January 23, 2024, and charged in Milimani Criminal Court along with Triton over fraud charges amounting to Sh 1.5 billion.

In the corruption case, Devani and Triton Petroleum Company Limited had been accused of the fraudulent release of 126 million liters of oil, violating a collateral financing agreement with Emirates National Oil Company (Singapore) Limited.

Devani faced eleven counts of fraud, including conspiracy to defraud, obtaining by false pretenses, and the fraudulent disposition of mortgaged goods.

One key allegation is that on September 5, 2008, while serving as Managing Director of Triton Petroleum, Devani and others unlawfully disposed of 13,054,850 cubic meters of diesel, valued at approximately USD 10,146,888.36 and Sh 32,017,783.66, to Total Kenya Limited without the consent of Emirates National Oil Company, the mortgagee.

Former Director of Public Prosecutions and Senior Counsel Philip Murgor who served in that capacity between 2003 and 2005 says the case could still find some life.

“A prosecution review is a continuous exercise; at some point, there might be evidence and things might change after many years,”

“If indeed there was loss of public funds, there is nothing that stops public agencies instituting recovery claims,” observed Murgor.

Kenya Pipeline, the state-owned entity responsible for oil storage and transportation, is on a firm spotlight as its then executives permitted Triton to withdraw and sell oil without full payment. These lax internal controls and collusion by some officials allowed Devani to access and sell oil owned by third parties, leading to the loss of billions.

The scandal caused oil prices to spike locally as supply became unstable, affecting consumers and industries alike. Kenya’s energy sector faced a period of volatility, which had an economic ripple effect as fuel prices influenced the cost of transport, production, and everyday goods.

Several banks and lending institutions, including Kenya Commercial Bank (KCB), Glencore, and Fortis Bank, had issued financial guarantees or financed Triton’s oil importation. When Devani defaulted on his loans, these banks suffered heavy losses, as the oil they had financed was no longer available for sale.