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Kenyan Businessman jailed in US for 10 years

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A wealthy Kenyan businessman has been jailed for 10 years in the United States.

Jeffrey Sila Ndungi who is a registered owner of two planes parked at Wilson Airport, was convicted on two counts of theft of public funds and one count of aggravated identity theft.

On August 9, 2016, Ndungi is accused of attempting to defraud the US Government a whopping Sh77 million.

According to evidence presented in court, the 32-year-old obtained Treasury check payable worth Sh77 million payable to an individual identified as C.S. that had been issued on a federal income tax return filed electronically from Kenya.

He then delivered the treasury check to an Internal Revenue Service (IRS) Criminal Investigation (CI) undercover agent in exchange for Sh4, 800,000.

Arrested

However, he was arrested on September 11, 2016, at Los Angeles airport as he attempted to board a flight to Nairobi, Kenya.

“Sila was also convicted of the theft of another treasury refund check that had been issued on an electronically filed return filed in 2012,” the court papers read.

According to the US regulations, the maximum statutory penalty for the identity theft count is a mandatory term of two years in prison and a Sh25, 000,000 fine.  The maximum statutory penalty for the theft of public funds counts are a maximum statutory penalty of ten years in prison and a Sh25,000,000 fine.

READ ALSO:   67 Kenyans in held in US prisons

Ndungi will serve his 10 years jail term at Dallas Prison.

Ndungi, who at the time of his trial was in the US on a tourist visa, was denied bail for being a flight risk.

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Diaspora

Kenyans wire back Sh1trn in offshore bank accounts

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Wealthy Kenyans have wired back an estimated Sh1 trillion from offshore accounts in the past three years, taking advantage of a tax amnesty offered by the Treasury.

The Kenya Revenue Authority (KRA) in a response to Business Daily queries said the amount was repatriated by some 16,000 applicants who took advantage of the amnesty window during which they were not required to declare the source of their wealth or even account for previous years’ tax arrears.

The amnesty, which was announced by Treasury Secretary Henry Rotich in 2016, is set to close next month.

“We have received over 16,000 applicants with the amount repatriated so far at Sh1,014,058,103,551. The incentive was meant to encourage Kenyans to repatriate their wealth back to the country for purposes of development,” said KRA in a statement.

The amount wired back is more than one third of Kenya’s annual Budget.

Wealthy Kenyans have traditionally stashed wealth abroad to either escape the taxman’s scrutiny or to spread their risks by investing in the more politically and economically stable Western democracies.

A report by an American think tank, the National Bureau of Economic Research (NBER), last year revealed that Kenya’s super-rich were holding more than Sh5 trillion in offshore tax havens across the world.

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Another international report released in 2007 detailed how a corrupt network in the Moi administration looted at least Sh130 billion and stashed it abroad, including in the United Kingdom and South Africa.

The report by risk advisers Kroll and Associates was commissioned by the then President Mwai Kibaki’s administration.

The 110-page report published online detailed how people close to Mr Moi set up shell companies, fronts and secret trusts to siphon away Kenyan taxpayers’ money, which they stashed in banks, real estate and companies in an estimated 30 countries around the world.

With the return into the country of the over Sh1 trillion, the owners of the cash have effectively ‘cleaned’ their wealth and evaded any questions on the source of the money or any tax liabilities that may have been due in the years before they made the declaration.

The colossal amount has, however, not made a visible impact in the economy, raising questions on where the cash has been kept.

Kenyan laws have a narrow scope on taxation of wealth earned abroad, but the amnesty offered a golden opportunity for those who had stashed cash offshore to bring it back without scrutiny.

Deloitte East Africa Tax Partner Fred Omondi said in an interview yesterday that most tax audit firms had not received any significant enquiries from Kenyans willing to repatriate wealth back home.

READ ALSO:   67 Kenyans in held in US prisons

“We haven’t seen a lot of uptake of this amnesty given that most income earned abroad is not subject to taxation in Kenya. Until the money is invested here and taxable income generated, there is no tax revenue to expect,” said Mr Omondi.

Mr Rotich, who yesterday did not respond to our queries on the impact that the Sh1 trillion has had on the economy, at the time of the announcement said the amnesty would make the environment more conducive for those willing to reinvest back home.

“Mr Speaker, taxpayers who take up this amnesty shall have all principal taxes, interests and penalties for the year of income, 2016 and the prior year’s automatically remitted in total. In addition, the government shall not follow up on the sources of such income and assets declared,” said the Treasury CS in his 2016 annual Budget Speech.

The incentive has since been extended twice to allow more uptake after potential applicants failed to take advantage fearing they would be subjected to provisions of Proceeds of Crime and Anti-Money Laundering Act.

Mr Rotich last year amended the law to exempt them from the requirement to declare the source of their wealth to the Financial Reporting Centre. He urged taxpayers to take advantage of the amnesty and “clean up their records with KRA”.

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KRA then issued guidelines on the repatriation and signed certificates for those who successfully applied for the repatriation during the period. The tax forgiveness applied only to those who declared income from their wealth abroad, including homes, for the period up to December 2018.

They were expected to file their returns with KRA.

Audit firm Ernst and Young, in its analysis of the amnesty in March 2016, warned that the process was prone to abuse.

“The amnesty should be undertaken with precaution as there is the potential for abuse with respect to money laundering under the pretext of repatriating assets,” the firm wrote a day after KRA held a stakeholders meeting to get feedback on the guidelines provided for the amnesty.

Delloite’s Fred Omondi also said the amnesty could have been used by those seeking to clean their funds before taking them back to the offshore havens with the needed legitimacy granted through the repatriation.

source:businessdaily

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US government releases the number of Kenyans sworn in as Citizens last year – 2,685

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2,685 Kenyans became naturalized United States citizens in the first three quarters of the 2018 fiscal year, data from the United States Citizenship and Immigration Services (USCIS) indicates.

Over the same period, a total of 544,475 foreign nationals holding US permanent residency became naturalized, with 44,095 of them being from African countries.

A total of 4,348 Kenyans became US citizens in the 2017 fiscal year, and 4,834 in fiscal year 2016.

In 2017, a total of 707,265 immigrants got naturalized in the United States.

To qualify for naturalization, immigrants must have been permanent residents (hold a green card) for at least five years, or at least three years if married to a US citizen.

SOURCE: Mwakilishi.com

READ ALSO:   VIDEO: New twist as autopsy shows no physical injuries on dead Kenyan woman
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E-passport centres launched in six countries to serve diaspora

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The government has launched e-passport centres in six countries to serve Kenyans in the diaspora.

Foreign Affairs CS Monica Juma  said the service will initially be available in Kenyan embassies in Pretoria, London, Paris, Dubai, Washington and Beijing before being expanded to other countries.

“We mounted the e-passport infrastructure last week. Kenyans are encouraged to get in touch with the missions for modalities of this process,” she said on Friday.

The launch of the centres means that Kenyans living abroad will no longer have to travel back home to apply.

Presidential directive

Run by the Immigration department, portals will be available on each Kenyan mission’s website, directing applicants on the procedure to follow.

Kenyans in diaspora had complained of lack of service despite a directive by President Kenyatta that the passports be issued in their countries of residence.

The foreign ministry said the Immigration department had been setting up the tools required for deployment of personnel.

Initially, embassies had required Kenyans to register their presence on the portals to help provide the numbers and influence decision on setting up centres.

Immigration service

The Immigration department had said it would start with North America, the Middle East and South Africa before moving to other regions.

READ ALSO:   SHOCKING: Kenyan woman charged with inserting hot knife in stepdaughter’s privates

The Ministry of Foreign Affairs manages diplomatic missions abroad but issuance of passports is a responsibility of the Immigration department. This means the department will have to send attaches to the embassies to provide the services.

While in Namibia in March, President Kenyatta directed that Kenyans living abroad be issued with the new generation passports in their countries of residence.

source:Daily Nation

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