Home Court News A man in she 120M Tax fraud detained till Wednesday.

A man in she 120M Tax fraud detained till Wednesday.

by Robert Guyana

A man involved in ongoing Sh 120M Tax Evasion Scheme at KRA Detained till Wednesday.Joel Ndungu Mbugua is being accused that in the Months of September and November, 2023 the Kenya Revenue Authority lost over Sh 120,000,000 through a well-orchestrated Tax Evasion scheme which involved Taxpayers (Importers), Tax Agents, Brokers and KRA Staff.The court heard that Tax agents would lodge an Entry number with the Integrated Customs Management System (ICMS) upon which an E-Payments slip (E-Slip) would be generated for payment of Customs Duty.The Taxpayers were made to believe that there was an organization with a credit line which would only be utilized in payment of customs duty only.The taxpayers were being requested to allow the organization to pay the total Customs Duty on their behalf after which they would pay 50percent of the total duty thus saving 50% of the total duty.With the 50% ,the importers would allow the Tax agents to share the E-slips with Tax brokers who would in turn charge the E-Slips to individuals who would through unauthorized means access KRA Systems and transition the Entry to “under control status without payment of Taxes.After that, the brokers would then demand 50% of the total Customs Duty from the importers.The importers would then deposit the monies into M-PESA and Bank accounts of the rogue Tax brokers after which the monies would be shared among individuals involved in the scheme.The court was also informed that a total of 129 entries with a Customs Duty value of over Sh 120,000,000 were cleared without payment of Taxes.Magistrate Gilbert Shikwe was informed that the respondent was arrested on October 19, 2023 at around 2230 hours and two of his mobile phones detained.“The two mobile phones have been handed over to the cyber forensics investigation unit for a forensic analysis,” added Officer Nobert Kioko who is investigating the case from the office of the Director of Public Prosecutions.Kioko added that the respondent in court is believed to be one of the rogue Tax brokers involved in receiving and forwarding E-payment slips to persons who gained unauthorized access to KRA SYSTEMS AND HTUS TRANSITIONING ENTRIES TO “UNDER CONTROL STATUS “.Ndungu is said to have received cash from several Tax Agents and other Tax brokers in the pretext of assisting them to save 50percent of total customs duty.He is said to have taken part in the facilitated theft of public funds that is taxes and having a common purpose for an unlawful undertaking did cause the commission of theft in contravention of section 268 of the penal code.“On August 11, 2023, the DCI conducted an operation within Nairobi and Mombasa so as to arrest and confiscate communication gadgets of those suspected to have been involved in the Tax evasion scheme, “he added.Kioko said that the suspect escaped during the operation.“The respondent switched off his phone and went into hiding so that he could not be traced,”kioko added.He is being represented by lawyer Jacob Okoth who pleaded with the court to release him on favorable bond terms.The prosecution sought more days to detain the accused saying that he is a flight risk and has other accomplices who are yet to be arrested.He pleaded with the court to be released on bond.The matter will be mentioned on Wednesday.

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