The Court of Appeal has delivered a major blow to Mozzartbet Kenya Limited, dismissing the bookmaker’s attempt to recover Ksh256 million that the state seized over suspicions of money laundering.
In a ruling that affirmed the findings of the High Court, Appellate Judges Francis Toiyott, Fred Ochieng, and Aggrey Muchelule concluded that Mozzartbet failed to explain why it paid massive sums to an entity suspected of being a shell company.
“There was sufficient evidence on the statutory threshold of balance of probabilities to implicate Mozzartbet,” the judges said, “and it cannot benefit from the protection of a third party.”
Betting Software Deal Under Scrutiny
Mozzartbet had argued that it paid the money to Kimaco Connection Ltd, a software company, in exchange for betting software. However, the court found that Kimaco lacked both the financial capacity and technical capability to deliver such a contract. The evidence pointed to suspicious transfers of the money from Kimaco to individuals directly linked to Mozzartbet.
Investigators from the Asset Recovery Agency (ARA) revealed that some of the funds made their way to directors of Mozzartbet, including Branimir Melentijevic, Emmanuel Charumbira, and Musa Cherutich Sirma. ARA further established that Kimaco had filed nil tax returns with KRA, proving it had no legitimate income-generating business during the relevant period.
“If It Quacks Like a Duck…”
The judges criticized the questionable nature of the transactions, invoking a common idiom in their ruling:
“The evidence revealed that Kimaco received payment under suspicious circumstances, made out payments in similar circumstances, and concealed its business from the tax authority. Is it not said that if it walks like a duck, swims like a duck, and quacks like a duck, then it probably is a duck?”
The court also noted that Kimaco and its associated firm Pescom Kenya paid invoices worth thousands of dollars to Melentijevic, allegedly for software services, but provided no credible evidence that such services were delivered.
“There was evidence that some funds initially paid by Kimaco to Pescom Kenya made their way to Melentijevic,” said the judges.
A Shell Company Built to Launder Money?
The High Court had previously ruled that Kimaco operated as a shell company, incorporated with the primary purpose of laundering funds. ARA said Kimaco posed as an ICT solutions provider but lacked the staff, infrastructure, and credentials to support its claims.
Mozzartbet’s confirmation that Kimaco had not delivered on its contractual milestones further weakened its case. In fact, during the trial, ARA submitted M-Pesa and bank transaction data that linked Mozzartbet’s payments to multiple layers of transfers, culminating in deposits to its directors’ personal accounts.
Mozzartbet’s Defense Falls Flat
Despite the damning financial trail, Kimaco’s lawyer Patrick Lutta insisted the funds originated from Mozzartbet’s legitimate betting operations. He claimed that the DCI had given Mozzartbet a clean bill of health, citing its Ksh17 billion revenue from bets.
Lutta argued that ARA’s decision not to enjoin Mozzartbet directly in the proceedings suggested the agency had no concrete evidence against the betting firm itself. However, the court found this argument unconvincing.
Final Verdict
The Court of Appeal upheld the High Court’s decision, ruling that the funds were indeed proceeds of crime. The judges emphasized that even if Mozzartbet had not been enjoined, the evidence clearly connected the company and its directors to illegitimate financial activity, and that the money could not be reclaimed.
