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NYS scam suspect fails to reverse seizure of Sh35m
Nderitu and his estranged spouse and their firms have been charged with conspiracy to commit an economic crime and fraudulent acquisition of public funds.
The Court of Appeal has rejected new evidence from a man the Assets Recovery Agency (ARA) says received more than Sh1 billion from the National Youth Services (NYS) without making any supplies to the agency.
James Thuita Nderitu claimed he had stumbled on new evidence while moving office and which was not available when the High Court ordered that he forfeit Sh35.6 million to the State.
He told the court that the evidence, including invoices, contracts, delivery notes, importation documents, and other business transaction records, would have shown that he made supplies to the NYS, but they were not available before and only got them while relocating from his business offices.
Mr Nderitu was separately fighting another petition by the ARA, which is targeting four of his properties including residential property in Thome, Garden Estate and Runda.
Justices Asike-Makhandia, Gatembu Kairu and Lydia Achode dismissed Mr Nderitu’s appeal saying it was an afterthought.
“We accordingly decline to buy that explanation as it is far-fetched, self-serving, illogical, leave alone being oxymoronic. In our view, the evidence was always available and for reasons best known to the appellants they declined to avail it,” said the judges.
Mr Nderitu and his estranged spouse and their firms have been charged with conspiracy to commit an economic crime and fraudulent acquisition of public funds.
The court had observed that Mr Nderitu and his companies received the money between March and October 2017 from NYS.
In the judgment in 2020, Justice Mumbi Ngugi (now Court of Appeal judge) said Mr Nderitu and his firms failed to address the issue of legitimacy of the source of funds held in their various accounts and that they should be forfeited to the State, as pleaded by the ARA.
The ARA had said Firstling Supplies in one day received Sh612 million from the NYS, wired in eight instalments, and received a further Sh876.4 million in three months. But when the agency obtained orders freezing the account, it had a balance of Sh6.28 million.
Flagstone Merchants received Sh278.6 million within eight weeks, including Sh235 million in a day, but only Sh1.2 million was forfeited from the account.
“We also note and as correctly observed by counsel for the respondent that the issue of vital documents being spirited away by State officials and DCI [Directorate of Criminal Investigations] detectives was never raised during the hearing of the forfeiture application,” the judges said.
The court said the businessman failed to explain the large deposits from the NYS, and in the absence of reasonable explanation, the funds could be assumed to be proceeds of crime.
Documents filed in court showed that Flagstone Merchants, for example, received Sh195.1 million from the NYS on March 21, 2017 while Firstling Supplies received more than Sh795 million between July 4 and 13, 2017 from NYS.
Former NYS Director-General Richard Ndubai and 28 former public officials are also facing charges of conspiracy to commit an economic crime and abuse of office.
