In 1915, the colonial government enacted the Native Registration Ordinance but it was not until 1919 and 1920 that it was implemented. The registration was an instrument to control and regulate the recruitment of African males into colonial labour. It contained a registration certificate and fingerprint of the holder. The Ordinance made it mandatory for all adult males aged 16 and above to be registered. Upon registration, they were issued with registration papers kept in metallic copper containers attached to a chain commonly referred to as “Kipande.” The Kipande was worn around the neck like a dog collar. The Kipande contained the wearer’s tribe, their strengths and weaknesses and comments from his employer on his competence, therefore, determining his pay or whether or not he would be employed.
The government used the Kipande to curtail freedom of Africans and monitor labour supply. It also empowered the police to stop a native anywhere and demand to be shown the document. For Africans, the Kipande was like a badge of slavery and sparked bitter protests.
In 1947, the Kipande was replaced by an identity booklet which had fingerprints but not the bearers portrait. A new law, the Registration of Persons Ordinance, was passed to make it mandatory for all male persons of all races of 16 years and above to be registered. But under this new law, the identity cards issued distinguished between the protectorate and non-protectorate persons. Although the Ordinance sought to remove discrimination based on race, it made no attempt to remove gender-based discrimination. The trend continued even after independence until 1978 when an amendment was made to what has become the Registration of Persons Act (Cap 107, Laws of Kenya) to include the registration of women who had attained the age of 16 years and above. A further amendment to the Act was made in 1980 to raise the age of registration from 16 to 18 years.
The first generation Identity Cards
In 1980, legislation was amended to include women and the booklet was replaced by the “First Generation” paper identity card with subtle security features embedded in the new document. The document design contained the bearers portrait and fingerprints. Raphael Musau, who was the officer in charge of National Registration Bureau and driving the whole process, witnessed the handing over of the new generation national identity card to the former president Daniel Arap Moi. In 1977, Raphael Musau was requested by the then vice president Daniel Arap Moi to design a new Kenyan Identity card which was to replace the blue colonial passbook. His first port of call, accompanied by Principal Registrar of Persons, was De La Rue, Company in London who eventually were tasked with making the new design.
The second generation card
The first generation identity card was replaced in 1995 by the smaller credit-card size “Second Generation” card, that was in essence, a laminated paper card. The card includes basic information [name, sex, date and place of birth, date and place of issue] a photo, a signature and an image of one fingerprint.
In 2011, the second generation card, in turn, was upgraded to the present plastic card without fundamentally changing its features. The current generation of IDs therefore date back to 1995, the last time that the population was re-enrolled.
The card includes basic information [name, sex, date and place of birth, date and place of issue] a photo, a signature and an image of one fingerprint. It also includes a sequential 8-digit national ID number (just a sufficient number of digits to cover a population the size of Kenya’s) as well as a 9-digit serial number. The information on the front of the card is machine readable on the back. Since 2007 there have been intentions to move to a “Third Generation” e-ID card with a chip and enhanced security features, but these have not materialized because of financial constraints.
Under the Registration of Persons Act (Cap.107), it is a requirement by the law of Kenya that a Kenyan citizen who attains the age of eighteen must have an Identity card facilitated through the Department of National Registration Bureau.
The National Registration Bureau (NRB) is responsible for collecting biometric and biographic information and issuing National IDs (NIDs). The NRB also operates the Automated Fingerprint Identification System that checks for duplicate or multiple registrations.
The Kenyan NID is mandatory and must be acquired when an individual turns 18, and is issued free of charge. The Kenyan NID does not have an expiration date. Thus far, Kenya has issued 24 million cards, but this total may include duplicates as well as the inactive cards of deceased individuals. There are about 1.2 million new registrations each year. Foreigners who remain in Kenya more than 90 days are required to register as an alien and get an alien registration card.
Every citizen in Kenya not previously registered has to go through the first category which is the initial registration of applying for an identity card. At this stage, no fee is paid to access this service. In Duplicates – resulting from lost, defaced or mutilated cards. National Registration Bureau charges a service fee of Kshs.100 with effect from 16th March 2018 for replacement and change of particulars resulting from a change of name(s) and residence which attracts a fee of Kshs.300 and Kshs 1,000 (depending on the request).
The requirement needs for the first stage of ID application by Kenyan citizens include a birth certificate or baptism certificate, both parents identity cards and copy, two passport size photos and a school leaving certificate.
On 19th September, 2005, the Head of Public Service appointed an Inter-Ministerial Taskforce on Integration of Population Register Systems (IPRS) in line with the National Economic and Social Council (NESC) recommendation on the fast-tracking of the integration of the registration systems. The Taskforce made several recommendations one of them was the introduction of a unique national number – Personal Identity Number (PIN) for all individuals resident in the country. That the number be assigned at birth for all residents and serve as the control number for all registration systems, Establishment of a National Population Register, containing information of all residents and serve as a central reference for all population registration systems, a central database. Development of nationwide ICT infrastructure backbone to link government agencies for purpose of information sharing and verification.
According to Kenya Law Reform Commission, the recommendations of this taskforce formed the basis for the formation of the Integrated Population Register System (IPRS) to serve as the single source of truth for the population data in the country. Although IPRS was a good step towards the integration of population data, it was limited in capacity since it only consolidated data from primary population registration agencies, these being Civil Registration Department (CRD), National Registration Bureau (NRB) and Department of Immigration Services (DIS), which are established by different legal regimes. Further, IPRS did not seek to validate the information received from primary agencies by getting information from the source, Kenyans. There were a number of shortcomings of IPRS hence the Government took up the challenge. In order to improve and build upon the progress made by IPRS, the Government initiated the National Integrated Identity Management system ( NIIMS) programme under Executive Order No. 1 of 2018. NIIMS was subsequently approved by the National Assembly vide the Statute (Miscellaneous Amendments) Act, No 19 of 2018.
The purpose of NIIMS project is to create and manage a central master population database, which will be the ‘single source of truth’ on a person’s identity since it will contain information of all Kenyan citizens and foreign nationals residing in Kenya and will serve as a reference point for personal data for Ministries, Departments and Agencies (MDAs) and other approved stakeholders. NIIMS involves registration of all Kenyans both locally and abroad and also all foreign nationals who live in Kenya. Upon registration, the enrolled persons will be issued with a unique identification number referred to as Huduma Namba and later a multi-purpose card referred to as Huduma card, which will substitute the current inefficient identity cards. The Huduma Namba, being a unique identification number, will be used to identify all persons in the country and thus will be used while accessing government services and identification both by government and the private sector. It will waive the need for issuance of multiple registrations of the same person and will be used from cradle to death. NIIMS will be the single source of foundational data about a person and all government agencies will tap into it. The Huduma card will contain the integrated personal and foundational data of the cardholder. The mass registration for Huduma Namba began in March 14th 2019.
Kings, Presidents and Tyrants: Uganda, 1500 to Present
1500 – 1852 – Bunyoro Kitara Kingdom: Bito dynasties of Buganda, Bunyoro and Ankole founded by Nilotic-speaking immigrants from the current southeastern Sudan. Expansion of Buganda at the expense of Bunyoro and take control of the territory bordering Lake Victoria from the Victoria Nile to the Kagera river.
1862 – The first European, British explorer John Hanning Speke visits Buganda.
1875 – Christian missionaries are allowed to enter the realm of Buganda King Mutesa 1.
1890 – A treaty signed between Britain and Germany gives Britain rights to what was to become Uganda.
1894 – Uganda becomes a British protectorate.
1900 – Britain signs an agreement with Buganda giving it autonomy and turning it into a constitutional monarchy controlled mainly by Protestant chiefs.
1958 – Uganda granted internal self-government.
1962 – Uganda becomes independent with Milton Obote as prime minister and with Buganda enjoying considerable autonomy.
1963 – Uganda becomes a republic with Buganda’s King Mutesa – Edward Luwangula Walugembe Muteesa II – as president.
1966 – Milton Obote ends Buganda’s autonomy and promotes himself to the presidency.
1967 – New constitution vests considerable power in the president.
1971 – Milton Obote toppled in coup led by Army chief Idi Amin.
1972 – Around 60,000 Asians Ugandan citizens expelled by Amin from Uganda.
1976 – Idi Amin declares himself president for life and lays claims to parts of Kenyan territory.
1978 – 1979 – The Uganda – Tanzania war known as the Kagera War in Tanzania and The 1979 Liberation War oust president Idi Amin from power.
1979 – Tanzanian forces invade Uganda, unifying the various anti-Amin forces under the Uganda National Liberation Front. Amin flees out of the country; Yusuf Lule installed as president, but quickly replaced by Godfrey Binaisa.
1980 – After elections Milton Obote returns as the president of Uganda.
1985 – Milton Obote is deposed in a military coup and replaced by Tito Okello. The new military leaders Tito Okello, Bazilio Olara Okello and Gad Wilson Toko hold onto the presidency for under a year before they are also ousted from power by the National Resistance Army (NRA) on January 26, 1986.
1986 – Yoweri Museveni becomes president after National Resistance Army rebels gain control of Kampala.
1993 – Yoweri Museveni restores the traditional kings, including the king of Buganda, but stripped of their political power.
1995 – The new constitution legalises political parties but maintains the ban on political activity.
1996 – Museveni returned to office in Uganda’s first direct presidential election.
1998 – Ugandan troops intervene in the Democratic Republic of Congo on the side of rebels seeking to overthrow Kabila.
2000 – Ugandans vote in favour of continuing Museveni’s “no-party” system rejecting multi-party politics.
2001 – Museveni wins a new term in office, beating his rival Kizza Besigye by 69% to 28%.
2005 July – Parliament approves a constitutional amendment which scraps presidential term limits. Voters in a referendum overwhelmingly back a return to multi-party politics.
2005 November – Kizza Besigye, opposition leader is imprisoned shortly after returning from exile having undergone a trial in a military court on various charges including treason and illegal possession of firearms. Supporters claim the trial is politically motivated, and take to the streets. Besigye is released on bail in January 2006, ahead of presidential elections.
2006 February – President Museveni wins multi-party elections, taking 59% of the vote against the 37% of his rival, Kizza Besigye. EU observers highlight intimidation of Mr Besigye and official media bias.
2010 October – Constitutional Court quashes treason charges against opposition leader Kizza Besigye.
2011 February – Museveni wins his fourth presidential election. Challenger Kizza Besigye alleges vote-rigging and dismisses the election result as a sham.
2011 April – Kizza Besigye arrested several times over ”walk-to-work” protests against rising fuel prices.
2016 February – President Museveni wins re-election against veteran candidate Kizza Besigye, amid opposition, Commonwealth, US and European Union concern about fairness and transparency of the electoral process.
2017 January – President Museveni appoints his son, General Muhoozi Kainerugaba, as a presidential advisor
2017 April – Former musical artist Robert Kyagulanyi Ssentamu popularly known by stage name Bobi Wine wins a by-election to become the legislator for Kyadondo County East against formidable opposition and draws attention in Uganda and abroad.
2017 December – Parliament votes to remove the age-limit for presidential candidates, clearing the way for President Museveni to run for another term.
2018 – The arrest and torture of Robert Kyagulanyi Ssentamu known as “Ghetto president” ignites popular protests with demands for his release.
2019 – Ugandan Musician and opposition leader Bobi Wine announced he’ll run for president in 2021, in an effort to thwart President Yoweri Museveni, who has been in power in Uganda since 1986
2020 – Political fever spikes as Uganda elections near with Bobi Wine running in 2021. Kizza Besigye challenged Museveni four times since 2001 and is no longer going to contest any election organized under the ruling NRM. Gregory Mugisha Muntuyera, the former Forum for Democratic Change (FDC) president, and Bobi Wine have joined forces in a new alliance called the United Forces of Change.
The Drivers of Inflation During the COVID-19 Pandemic
The drivers of inflation during the COVID-19 pandemic period resulted from demand-pull inflation, cost-push inflation and money supply.
Jane Muthoni can still put together a tasty ‘ugali-madondo’ dish, a local specialty of Makongeni composed of maize flour and beans in a savory stew.
Trouble is, the dish and other tasty delicacies cost a lot more to make now than they did back in 2015 when she started the business, thanks to the hidden economic forces.
To operate her popular cafe, known by locals as a “kibanda”, Muthoni says she has to pay three times as much for charcoal, and 30 percent more for kerosene, her primary cooking fuels. On top of that, the price of food ingredients is also up – maize flour is up more than 12 percent.
While not all items in the Kenyan economy are experiencing this price inflation, the rising costs are putting extra pressure on businesses that are already struggling with losses related to the health impact of the COVID-19 pandemic.
Inflation generally refers to the upward price movement of goods and services in an economy. It represents the overall loss of purchase power of money. The more prices soar upwards, the less each Kenya shilling is worth.
The Kenya National Bureau of Statistics (KNBS) measures inflation using the Consumer Price Index (CPI). CPI is measured by a weighted average cost of a basket of selected goods and services such as food, housing, health, transport and so on. The inflation rate is typically the average change in the CPI over time, say year to year.
Muthoni, like many other Kenyans, does not necessarily understand why the prices of the items change over time.
This article assesses three drivers of inflation during the COVID-19 pandemic.
1. Demand-Pull Inflation
When the market demand for goods and services, such as flour, beans, charcoal, transport and others that Muthoni needs to run her çafe, outgrows the market supply, it causes demand-pull inflation.
It starts with an increase in demand by consumers, and sellers will react to that demand by increasing their supply. This leads to pressure on the scarce supplies making sellers raise their prices. This is one of the scenarios that result in inflation.
A marginal increase in inflation is observed between March and April in the graph above. This can be attributed to the demand-pull inflation as Kenyans were driven to panic buying and stocking of essential supplies such as food in anticipation of what would happen following the confirmation of the first COVID-19 patient in the country. The growth in aggregate demand resulted in a reduced availability of these goods causing higher prices hence the slight increase in the inflation rate.
Muthoni grappled with this increased cost on food supplies for her cafe which raised her expenses – cutting into her profit margins.
Another reason for demand-pull inflation could have been the depreciation of the Kenya shilling which in turn would increase import prices and reduce prices of exports. This meant fewer people had capacity to import while exporters would earn more. Since Kenya relies heavily on imports, this resulted in a growth of the total demand of goods and services in the economy
To mitigate the effects of the COVID-19 pandemic to the Kenyan economy, the Government approved tax reduction and relief measures that were effected from the 25th April 2020.
This meant that taxpayers had more disposable income. It would be expected that the tax reduction would have raised demand, which would drive the price of goods and services upwards.
However, the reverse is observed on the chart above as the inflation rate steadily decreased from May onwards. This can be explained by the fact that some Kenyans lost jobs (estimated at 1.7 million by the KNBS), some received pay-cuts whereas others, in informal employment, were not eligible.
2. Cost-Push Inflation
When supply costs of goods and services rise due to increasing cost of production or raw materials, and demand remains the same, prices will rise. This will cause cost-push inflation.
Cost-push inflation can be attributed to the expectation of inflation where people foresee prices for goods or services rising. The marginal increase in inflation observed between March and April can be attributed to the uncertainty of the effect of the COVID-19 pandemic.
This could have affected Muthoni’s business as the increased cost of food supplies was transferred from the farmers to producers, from wholesalers to retailers and finally borne by customers like her.
The depreciation of a currency rate can also cause cost-push inflation as it leads to an increase in the prices of imported goods such as raw materials for production. In return, producers transfer this growth in prices to consumers, which results in inflation.
3. Money Supply
All the currency and other liquid assets in an economy is referred to as money supply. It includes both cash and deposits that can be used almost as easily as cash. When there is more money supply in circulation, it will increase market demand. This in turn can lead to more domestic (local) production or an increase in prices. If domestic production is fixed, then any increase in market demand of goods and services will cause a rise in prices leading to inflation.
In response to the COVID-19 pandemic, the Central Bank of Kenya (CBK) reduced the Central Bank Rate (CBR) to 7.25 percent from 8.25 percent and Cash Reserve Ratio (CRR) to 4.25 percent from 5.25 percent to avert a severe economic and financial crisis. This resulted in more money supply, of Kshs 35.2 billion. This offered banks additional liquidity and funds to lend.
While this offered Muthoni a chance to secure a bank loan, she was not confident that her cash flows would sustain its repayment as her customers kept reducing by the day.
The chart above reveals that the increase in money supply did not cause an increase in inflation. This could be attributed to growth of domestic production at the same rate as money supply, implying that the money is absorbed in production.
It could also be attributed to low circulation of the money in the economy. When the average number of times that money is spent on goods and services is low despite an increase in money supply, the prices are likely to remain low as observed at the peak of the COVID-19 pandemic period.
Was the inflation rate uniform for all the basket items though?
The change in Basket Consumer Price Index was different across various categories.
The main driver for the decline in the inflation rate is consistent decrease in food and non-alcoholic beverages prices from May onwards. This can be linked to the reduction of VAT from 16 percent to 14 percent.
In contrast, the cost of transport increased sharply between June and July. This is attributed to an increase in demand for people travelling following the lifting of the cessation of movement into and out of the Nairobi Metropolitan area, Mombasa county and Mandera county on the 7th of July, 2020.
The cost of alcoholic beverages, tobacco and narcotics remained relatively stable until June when prices started to decline owing to reduced demand as a result of the suspension on the operation of bars.
Muthoni and colleagues dealing in restaurants and food businesses were allowed to remain open only for take away services. However, the demand for restaurants and hotels is seen to dip during the peak period of the COVID-19 pandemic, but things seem to be looking up from the month of August as prices for their services have gone up by close to 3 percent.
Since schools and learning institutions have been closed since March, the prices for education services have barely changed.
The drivers of inflation during the COVID-19 pandemic period resulted from demand-pull inflation, cost-push inflation and money supply. Despite the almost consistent decline in the inflation rates, the change in the Consumer Price Index did not depict a similar trend for all the goods and services.
Additional contribution by Purity Mukami.
This article was first published by Africa Uncensored’s Piga Firimbi
Kenya Transactions in FinCEN Files Raise Suspicions Around Coffee and Ivory Trade
Twenty-four Kenyan financial institutions were named in the reports as either beneficiaries’ banks or banks through which companies and individuals made suspicious payments from countries that include the United Arab Emirates, Nigeria, the United Kingdom, British Virgin Islands and China.
At least 53 Kenyan companies and individuals appear in a leak of banking records submitted to the US Department of Treasury as suspicious financial activity, according to an analysis of leaked bank documents by Africa Uncensored.
The documents, submitted by some of the world’s largest banks to the US Department of Treasury’s Financial Crimes Enforcement Network, also known as FinCEN, were obtained by BuzzFeed News. BuzzFeed News shared the documents with the International Consortium of Investigative Journalists (ICIJ) which coordinated 110 media partners around the world.
The size of the leak, 2,100 suspicious activity reports filed by U.S. banks, or SARs, is unprecedented. While the documents are not evidence of wrongdoing, they provide a unique, bird’s-eye view of global illicit money flows often obtained through corruption and other crimes.
Twenty-four Kenyan financial institutions were named in the reports as either beneficiaries’ banks or banks through which companies and individuals made suspicious payments from countries that include the United Arab Emirates, Nigeria, the United Kingdom, British Virgin Islands and China.
“Banks are at the heart of the finance industry. Both legitimate and illegitimate finance moves through financial institutions. Big money is not carried in suitcases but through very respectable banks and other international financial institutions”, says Alvin Musioma, executive director of Tax Justice Network Africa.
Additional reporting by Africa Uncensored also linked shareholders of Commercial Bank of Africa — now named NCBA Group — which is co-owned by Kenya’s first family, to a company that received millions of US dollars in potentially suspicious payments for coffee and DVD players.
The Coffee Case
The New York branch of Standard Chartered, which acted as an intermediary bank, flagged payments sent to a company called SMS Ltd which the bank identified as having addresses in Kenya, Afghanistan, Uzbekistan, Russia and Bulgaria.
In the reports, the bank described SMS Ltd as being “in [the] pharmaceutical and medical products” industry. However, the bank noted, the companies sending the payments were in completely different lines of businesses, including commodities trading, vegetable oil production, and coffee exports.
Of the $14 million that SMS Ltd received between 2005 and 2013, $3.3 million was paid by Kenyan entities. More than $2 million of that was from two coffee Kenyan dealers, East African Gourmet Coffees Ltd and Servicoff Ltd. In fact, the companies are connected to each other and share company officers with companies linked to the Kenyatta family.
According to company registration documents, East African Gourmet Coffees’ directors include an obscure company with no online presence, New Start Nominee Limited, and two individuals, Kibet Torut and Peter Kimathi Kinyua, who also owns Servicoff Ltd.
One of the shareholders of Servicoff Ltd is Ropat Nominees Ltd, the second-largest shareholder of NCBA Group, co-owned by President Kenyatta’s family via their company Enke Investments Limited.
The two Ropat Nominees’ directors co-own other companies, including one with John Stuart Armitage, who appears in numerous companies owned by Kenya’s first family. The company, Southbrook Holdings, was recently at the centre of a contentious land sale deal involving the president’s mother.
Contacted by journalists, Peter Kimathi Kinyua said that Servicoff Ltd’s payments to SMS Ltd (registered in Kenya as Sustainable Management Services Limited) have been for the purchase of coffee. He declined to comment on the involvement of Ropat Nominees Ltd except to confirm that the company is part of the nominee shareholders.
“We normally deal with SMS – Sustainable Management Services, a coffee marketing agent at Nairobi Coffee Exchange,” said Kibet Torut while denying knowledge of SMS Ltd and the transactions quoted from the suspicious activity report, in an email response.
Kinyua was appointed by President Uhuru Kenyatta as board chairman for Kenya Forest Service in 2018.
Both Kinyua and Kibet Torut denied having any business ties to the president.
According to their website, Servicoff Ltd, has been growing, processing roasting and blending coffee since 1969. The company shares an email domain name with East African Gourmet Coffees Ltd, the other coffee dealer named in the bank’s report.
Import records confirm that Servicoff has been shipping Washed Kenya Arabica AA coffee since 2007, mainly to the U.S.
The bank report also noted that SMS Ltd had received $1.3 million from Louis Dreyfus Commodities Kenya, listed as a commodity broker in the SAR, the local branch of a global trade firm headquartered in Switzerland that deals in the coffee business too. Africa Uncensored has identified that one of the directors behind the Nairobi branch of Louis Dreyfus is Alexander Mareka Dietz, who is also a director in a company with Udi Mareka Gecaga, a one-time brother-in-law to President Kenyatta.
Reporters were unable to reach Dietz, and automated replies to emails sent to the company address indicate that only approved senders are able to email the company.
Company records obtained by Africa Uncensored reveal that Sustainable Management Services (SMS) Limited is wholly owned by East Africa MM Co. LLC, which is registered in the US state of Delaware, a recognised haven for shell companies due to its reputation for corporate secrecy and tax breaks.
On a US coffee seller’s website, SMS Ltd markets Kenya AA coffee that is handpicked by many small-holding farmers in central Kenya.
According to the Kenya Biogas program website, the company is “one of the partners working with coffee farmers through targeted capacity building on climate change through projects.”
A snapshot of their website in 2016 reveals that SMS Ltd is a group company of Ecom Agro-Industrial Corporation Limited, which is registered in Switzerland with the Esteve family its ultimate beneficial owner. Ecom’s website lists an office at Tatu City coffee park in Ruiru, Kenya where SMS Ltd is located, according to its Facebook page.  The Esteve family also runs ECOM Coffee, a leading global coffee miller and coffee trader.
However, according to the FinCEN files, of the 201 transactions SMS Ltd received totalling over $14 million, more than half came from a Dubai-based vegetable oils production company for the purchase of television and DVD player.
When asked by journalists to comment on why a Kenyan company with a Delaware-registered shareholder markets coffee from Kenyan farmers to Kenyan companies exporting to the US, Musioma, the Tax Justice Network Africa executive director, had this to say:
“The fact that we are talking of companies being registered in tax havens and coming in, speaks of the lax laws we have when it comes to beneficial ownership. You might find that there is a conflict of interest here emanating from the directors of these companies being the ones that are involved in those transactions”.
Reporters were unable to reach SMS Ltd. Emails to the parent company in Switzerland went unanswered.
Victoria Commercial Bank and Middle East Bank (MEB) Kenya Ltd did not respond to questions concerning these transactions, some of which were processed by the banks.
Standard Chartered Bank, whose New York branch filed the suspicious activity report, did not respond in time for publication.
“No More Bullshit”
In another set of transactions in a separate suspicious activity report reviewed by Africa Uncensored, a would-be fashionista named Joyce Oweya Anyumba — a 33-year-old with addresses in Buruburu, Nairobi, and Mombasa — held an account with the Barclays Bank of Kenya from 2015.
Her industry included interior design, curio and African wear, according to Barclays’ report.
However, between July 2015 and October 2016, the account sent and received about 63 wire transfers totalling to $197,094.51. Anyumba received funds from banks in Qatar, the US, Australia, China, Germany and Sweden; she also wired a total of $1234.45 in small payments to individuals in the US, Australia, Canada, Sweden, China and Singapore that the bank could not verify.
The transactions were flagged by the bank because of unidentified sources of funds, unclear economic purposes of the transactions, and potentially being third-party payments.
The justifications for the payments included descriptions such as “bill settlement”, “construction of house” and “consultation fees”, according to the bank’s report.
Other payment details included “government first payment”, “gift finalization of matters discussed”, and “supplier invoice payment to be forwarded”.
One sender from Australia made 13 transfers worth almost $12,000 to Anyumba within a year. The payment details included the mysterious notes: “supplier invoice the money better come back” and “supplier invoice make good on your promise no ivor no more bullshit.” The bank noted in its report: “ivor probably meaning ivory.”
Anyumba denied knowledge of these transactions in an email.
“Am sorry sir, I don’t know what you’re talking about,” said Anyumba when we asked her to confirm the above transactions. She did not reply to our follow up emails on her age, address and whether she is in the business of selling clothes and interior design materials.
There is no legal trade in ivory in Kenya, according to Dr Richard Thomas, the head of communications for TRAFFIC, a UK-based wildlife trade monitoring organisation. “It doesn’t come as any surprise to hear you say there’s essentially no record of [the parties]”, Thomas told reporters.
“Wildlife is like any other commodity that’s traded: there’s buyers and sellers and money changes hands. International commercial ivory trade is banned under CITES, but the trafficking of it takes place, run by largely Asia-based organised criminal syndicates. One effective strategy to targeting such networks is through following the money”, said Thomas.
Other senders of money to Anyumba include an American man with a history of shoplifting and bankruptcy, according to the bank’s suspicious activity report.
The account was expected to have an annual turnover of about 16 million Kenya shillings ($160,000), according to Barclays, but the customer received significant transactions whose real economic purposes could not be identified.
“Barclays Kenya has filed a SAR on Anyumba with their local regulator and is in the process of exiting the relationship,” the report noted.
The Kenya branch of Barclays Bank — now known as ABSA Bank Kenya PLC — had not answered our questions regarding the specifics of the transactions by the time of publication.
Musioma listed some general concerns of suspicious trade through Kenya because the country serves as a hub for drug smuggling and illicit trade in all kinds of goods, including ivory and smuggled minerals.
“All these monies are not carried in suitcases or wheelbarrows. The banking sector is at the centre of it. And I don’t think that both the Central Bank and regulators are doing enough to stretch banks in terms of punitive measures,” said Musioma.
Many of the transactions flagged as suspicious by banks in the FinCEN Files involve recipients and originators from Kenya and other high-risk jurisdictions, including Cyprus, Mauritius, Moldova, Latvia, Afghanistan, Russia and Turkey.
Musioma likened banks to providers of “getaway cars” in crime and corruption in the country — the so-called intermediaries in terms of them providing the oil to enable corruption. “So, the fight against corruption, illicit financial flows and money laundering and all these other crimes can never be won without bringing in the central role banks play”.
Much more could be done to address the role of Kenyan banks in money laundering and other financial crimes, according to Musioma. For example, increasing the punishment for banks who break regulations designed to prevent illicit flows, improve due diligence in the banks’ compliance procedures, and address the issue of the revolving door.“ We have seen people moving in from the banking sector to become regulators and that will create a conflict of interest in the banking industry,” he said.
With Kenya working on being a regional financial centre, through the Nairobi International Finance Centre (NIFC) the regulation and enforcement of the financial sector must be tightened, the tax expert concluded.
Additional reporting by Juliet Atellah, data journalist at The Elephant.
John-Allan Namu, Martha Mendoza of AP and Kira Zalan of OCCRP contributed to this article.
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