Influenza
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- Jul 1, 2018
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Five banks that handled the National Youth Service money have been fined Sh385 million.
The Office of the Director of Public Prosecutions fined Standard Chartered, Equity, KCB, Cooperative and Diamond Trust Bank of Kenya.
This was after financial institutions entered into deferred plea agreements with the office to defer their prosecution for the breaches they committed in handling the large sums of money.
The ODPP invoked Articles 157 (11) and 159 of the Constitution that provide for alternative dispute resolution in entering the agreement.
The agreement was also in line with the plea agreement and diversion guidelines launched by the ODPP to hasten cases and recover the loot.
The money was deposited in the Prosecution’s Fund. Standard Chartered Bank Kenya was the latest institution to sign the agreement in December last year.
The bank paid Sh100 million.
According to the terms of the agreement exclusively seen by the Star, Standard Chartered will fully cooperate with the ODPP in the ongoing NYS cases.
It will provide evidence and documents, including bank statements and details of those who opened accounts, transacted huge amounts and the recipients of the cash and any other relevant information that will aid the prosecution of the cases.
“During the terms of the agreement, at the written request of the ODPP, the bank shall cooperate fully with national law enforcement authorities and agencies in any investigation of the bank regarding any of its officers, directors, employees, agents and consultants or any other part relating to the offences,” it reads.
The parties further agreed that the bank shall institute an internal disciplinary mechanism related to the offences and shall report to the ODPP within the terms of the action taken against the staff if found culpable.
“Should the bank learn of any evidence or allegations of any violation of anti-money laundering reporting or books and records of the law, it shall promptly report to the ODPP in accordance with applicable law,” it reads.
A deferred plea agreement is usually entered into with corporates – especially financial institutions – to avoid economic shocks and disturbances that may result from their prosecution.
Should they fail to comply with the terms of the agreement, they forfeit the cash and the ODDP proceeds with the prosecution.
Failure to make the payment, deliberate provision of false or misleading information and failure to cooperate with the ODPP amount to a breach of the agreement.
SCBK, whose parent office is domiciled in London, entered into the agreement to avoid prosecution over the illegal handling of the cash believed to have been stolen from NYS.
Standard Chartered PLC, the parent company of the bank, disclosed the deal on the London Stock Exchange.
“In December 2019, Standard Chartered Bank agreed to a settlement of this matter with the DPP,” the bank disclosed in LSE.
It further states in the disclosures that under the settlement, DPP Noordin Haji agreed to defer prosecution against both SCBK and any persons affiliated with the bank. He then imposed a penalty of Sh100 million ($964,000) on the bank.
The ODPP has recovered Sh2.9 billion from graft. The money has been deposited in the prosecution Fund Account.
Deferred prosecution has been implemented in a number of jurisdictions, including the UK and US, for a quicker conclusion of cases.
Haji has often offered an olive branch to suspects to enter plea bargains for faster conclusions of their cases.
In 2018, the Central Bank of Kenya found five banks culpable for illegally handling the billions stolen from NYS and fined them millions of shillings.
CBK said the banks violated the law by failing to report the large cash transactions and failing to undertake adequate customer due diligence.
SCBK was fined Sh77.5 million, Cooperative Bank (Sh20 million), DTB (Sh56 million), Equity (Sh89.5 million) and KCB (Sh149.5 million).
“CBK announced the conclusion of the first phase of the investigations of the banks that were used by these persons (suspects) in transacting the NYS funds. The investigations prioritised banks that handled the largest flows,” CBK said in a statement then.
The Office of the Director of Public Prosecutions fined Standard Chartered, Equity, KCB, Cooperative and Diamond Trust Bank of Kenya.
This was after financial institutions entered into deferred plea agreements with the office to defer their prosecution for the breaches they committed in handling the large sums of money.
The ODPP invoked Articles 157 (11) and 159 of the Constitution that provide for alternative dispute resolution in entering the agreement.
The agreement was also in line with the plea agreement and diversion guidelines launched by the ODPP to hasten cases and recover the loot.
The money was deposited in the Prosecution’s Fund. Standard Chartered Bank Kenya was the latest institution to sign the agreement in December last year.
The bank paid Sh100 million.
According to the terms of the agreement exclusively seen by the Star, Standard Chartered will fully cooperate with the ODPP in the ongoing NYS cases.
It will provide evidence and documents, including bank statements and details of those who opened accounts, transacted huge amounts and the recipients of the cash and any other relevant information that will aid the prosecution of the cases.
“During the terms of the agreement, at the written request of the ODPP, the bank shall cooperate fully with national law enforcement authorities and agencies in any investigation of the bank regarding any of its officers, directors, employees, agents and consultants or any other part relating to the offences,” it reads.
The parties further agreed that the bank shall institute an internal disciplinary mechanism related to the offences and shall report to the ODPP within the terms of the action taken against the staff if found culpable.
“Should the bank learn of any evidence or allegations of any violation of anti-money laundering reporting or books and records of the law, it shall promptly report to the ODPP in accordance with applicable law,” it reads.
A deferred plea agreement is usually entered into with corporates – especially financial institutions – to avoid economic shocks and disturbances that may result from their prosecution.
Should they fail to comply with the terms of the agreement, they forfeit the cash and the ODDP proceeds with the prosecution.
Failure to make the payment, deliberate provision of false or misleading information and failure to cooperate with the ODPP amount to a breach of the agreement.
SCBK, whose parent office is domiciled in London, entered into the agreement to avoid prosecution over the illegal handling of the cash believed to have been stolen from NYS.
Standard Chartered PLC, the parent company of the bank, disclosed the deal on the London Stock Exchange.
“In December 2019, Standard Chartered Bank agreed to a settlement of this matter with the DPP,” the bank disclosed in LSE.
It further states in the disclosures that under the settlement, DPP Noordin Haji agreed to defer prosecution against both SCBK and any persons affiliated with the bank. He then imposed a penalty of Sh100 million ($964,000) on the bank.
The ODPP has recovered Sh2.9 billion from graft. The money has been deposited in the prosecution Fund Account.
Deferred prosecution has been implemented in a number of jurisdictions, including the UK and US, for a quicker conclusion of cases.
Haji has often offered an olive branch to suspects to enter plea bargains for faster conclusions of their cases.
In 2018, the Central Bank of Kenya found five banks culpable for illegally handling the billions stolen from NYS and fined them millions of shillings.
CBK said the banks violated the law by failing to report the large cash transactions and failing to undertake adequate customer due diligence.
SCBK was fined Sh77.5 million, Cooperative Bank (Sh20 million), DTB (Sh56 million), Equity (Sh89.5 million) and KCB (Sh149.5 million).
“CBK announced the conclusion of the first phase of the investigations of the banks that were used by these persons (suspects) in transacting the NYS funds. The investigations prioritised banks that handled the largest flows,” CBK said in a statement then.
