The Director of Public Prosecutions (DPP) has approved charges against five individuals and 12 companies over an alleged Value Added Tax (VAT) fraud scheme that investigators say was designed to defraud the government of billions of shillings.
The suspects are accused of participating in a network that generated fictitious transactions and electronic tax invoices, which businesses allegedly used to claim fraudulent VAT refunds or reduce their tax liabilities despite making no genuine purchases.
The Office of the Director of Public Prosecutions (ODPP) said the decision to prosecute followed joint investigations with the Kenya Revenue Authority (KRA) and a review of 70 inquiry files.
The five individuals identified in the investigations are Henry Ateka Nyabwari, James Ojiambo Nyengenye, Amisi Zamda, Frank Nyabwari and Hesbon Onyoni.
According to the ODPP, the five are alleged to have been involved in registering 70 companies that were instrumental in executing the scheme.
The prosecution has been approved in 36 cases involving transactions valued at approximately Sh3.9 billion, with the alleged tax loss estimated at about Sh519 million.
Of these, six cases have been prioritised for immediate prosecution. The six cases involve an estimated VAT implication of Sh17 million, according to the ODPP.
The cases involve several companies, including Renova Limited, Larigr Enterprises, Njemtar Agencies, Jeflar Construction Company, Namtek Transporters Company Limited, Jawari General Supplies and Tekaza Investment & General Supplies.
The ODPP said the remaining files would be registered in court in due course, with the suspects involved facing charges accordingly.
The alleged scheme relied on so-called “missing traders”, companies used to generate fictitious transactions and tax invoices that created the appearance of legitimate business activity.
Such invoices were allegedly used by other businesses to make unlawful VAT refund claims or lower their tax bills without corresponding purchases.
The ODPP said it remained committed to combating economic and financial crimes, including sophisticated tax fraud schemes, and protecting public revenue.
The suspects and companies have not been convicted, and the allegations will be tested through the court process.
