August 12, 2013 · Documents in possession of the Star, including a report prepared by the Criminal Investigations Department (CID) prior to the fire incident point to a major collusion between immigration officials, custom officials and police at JKIA in the illegal gold trade and money laundering.
The Flying Squad in a confidential report has revealed that Sh3.4 billion has been transiting through JKIA every month in cash without any scrutiny and without the involvement of any bank or financial institution.
On the spot are companies which Flying Squad says have been exporting gold and “transact in cash without involving banks or foreign exchange dealers.”
The Flying Squad has unearthed that the gold exporters on the spot have not been using official monetary instruments declaration form at JKIA “but rather counterfeit forms which are not in quadruplicate as required by law”under the guise that the genuine and official forms are out of stock.
Flying Squad has also said that from February 2013 to May 2013, passenger manifests obtained from Emirates Airline indicate the different names of people suspected to be couriers of the cash which are also reflected in the currency declaration forms.
The squad has said there in need for an “explanation for cash amounting to US$40 million (Sh 3.4 billion) per month transiting through JKIA without any scrutiny and these large sums of cash not being banked.”
The report by CID was finalized a few days before last week’s inferno at JKIA that destroyed the international arrivals terminal at Kenya’s largest airport. The Wednesday’s fire destroyed Customs area, immigration area and airport police.
In essence, the fire destroyed all records at the immigration area, those of the custom department as well as vital information held by the police.
There is a possibility that the subject of this investigation started on May 22, 2013 by officers from the Flying Squad Unit led by the unit’s head Munga Nyale, will be of interest to those looking in who may have started the fire.
Vital documents related to the 17 shipments of gold valued at Sh 6.2 billion which was exported in 2010 by eight companies to the UAE, Canada, Italy and South Africa are believed to be among those destroyed during the fire.
In 2011, the same companies exported gold worth Sh5.7 billion and a further Sh4.5 billion last year.
Highly placed sources with the police and those familiar with the gold sector claim that unscrupulous gold traders working in cahoots with custom officials, police and immigration officials to facilitate the business have been shipping off gold smuggled from neighbouring countries such as Democratic Republic of Congo under the guise that it was all from Kenyan mines. “The gold is exported as originating from Kenya. It is usually transported at night to JKIA where unscrupulous immigration officials, custom officials and police collude to ensure that the cargo leaves the country without proper documentation or scrutiny.”
The sources said that once the shipment arrives at its destination, payment is made in cash—usually in dollars. The cash is then brought into the country by couriers who are met at the airport by customs and immigration officers who facilitate their entry without proper documentation.
The law requires that residents and non-residents bringing in cash equivalent to USD 5,000 (approximately Sh 500,000) and more need to hold documents indicating the source and the purpose of the amount.
In its report, the Flying Squad has warned that there is possibility of the large amounts of cash illegally entering though JKIA “being used for funding terrorism, purchasing or smuggling of arms or money laundering.”
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