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Published online by Cambridge University Press: 21 January 2020
Civil forfeiture is an asset forfeiture mechanism available to seize proceeds of crime. Kenya has embraced its use and provides statutory mechanisms for its implementation. The Proceeds of Crime and Anti-Money Laundering Act is the main statute in this regard. This article examines the substantive law and procedure for civil forfeiture provided in this statute. The analysis indicates that the provisions are technical in nature and that the process is systematic. This ensures a procedurally and substantively fair process before an individual's property is seized. This approach aims to safeguard against the arbitrary deprivation of property. Nonetheless, challenges are identified that interfere with the effective implementation of the civil forfeiture regime. These problems lead to the current underutilization of the regime. Accordingly, the article identifies viable ways of addressing these shortcomings. Implementation of these suggestions could enhance the use and success of civil forfeiture in dealing with the proceeds of crime.
Lecturer, University of Nairobi, School of Law.
1 Kruger, AOrganised Crime and Proceeds of Crime Law in South Africa (2nd ed, 2013, Lexis Nexis) at 8–9Google Scholar and 114; Rees, E, Fisher, R and Thomas, RBlackstone's Guide to the Proceeds of Crime Act 2002 (4th ed, 2011, Oxford University Press) at 160Google Scholar; Boister, NAn Introduction to Transnational Criminal Law (2012, Oxford University Press) at 240CrossRefGoogle Scholar.
2 Boister, ibid.
3 Proceeds of Crime and Anti-Money Laundering Act, sec 92(1).
4 Cap 59, Act No 6 of 2010.
5 Act No 2 of 2013, sec 18.
6 Act No 30 of 2012, sec 40.
7 Act No 4 of 1994.
8 Act No 47 of 2016, sec 18(7).
9 Cap 65, Act No 3 of 2003.
10 Cap 59B, Act No 9 of 2009.
11 National Director of Public Prosecutions v Meir Elran (2013) (1) SACR 429 (CC), para 66. Hendry, J and King, C “‘How far is too far? Theorising non-conviction-based asset forfeiture” (2015) 11/4International Journal of Law in Context 398CrossRefGoogle Scholar at 398–99.
12 See parliamentary debates on the POCAMLA bill in Kenya National Assembly Official Report (Hansard) of 8 May 2008 per Dr Shaban and Mr Wamalwa at 946 and 951 respectively.
13 POCAMLA, secs 81–89.
14 Id, secs 90–99.
15 Id, secs 56(2) and 81(2).
16 There have been very few prosecutions under the statute. Moreover, as at November 2019, fewer than five forfeiture orders had been given under the act. In the case of Asset Recovery Agency v Charity Wangui Gethi ACEC misc appln no 16 of 2016, judgment 20 November 2018, the forfeiture order was denied. A forfeiture order was granted in The Assets Recovery Agency v Quorandum Limited and Two Others misc appln no 4 of 2017, judgment 21 September 2018.
17 The Kenyan courts endorsed this position in Kenya Anti-Corruption Commission v LZ Engineering Construction Ltd and Five Others civil misc appln no 599 of 2004 [2004] eKLR (10 December 2004). Although speaking in reference to ANECA, P Kariuki J stated (at 8) that, when dealing with new and untested legislation in order to develop jurisprudence “collaboration and exchange of ideas on the lessons learnt from the experiences of others in the implementation of similar legislation in other jurisdictions” was vital.
18 These are the 1988 Vienna Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances, 28 International Legal Materials 493 (1989), UN Convention against Transnational Organized Crime 2000, 2225 UN Treaty Series 209, as well as the Financial Action Task Force (FATF) recommendations. Kenya and South Africa are members of the Eastern and Southern Africa Anti-Money Laundering Group, a body tasked with assisting in implementing the FATF recommendations in the region; see: <http://www.esaamlg.org> (last accessed 16 December 2019).
19 The Constitution, art 21(1).
20 POCAMLA, preamble.
21 Id, sec 54(1A). See also id, sec 92(1).
22 Id, sec 2.
23 Durrieu, RRethinking Money Laundering and Financing of Terrorism in International Law Towards a New Global Legal Order (2013, Martinus Nijhoff Publishers) at 395–415CrossRefGoogle Scholar.
24 Republic v Director of Public Prosecutions and Another Ex Parte Patrick Ogola Onyango and Eight Others JR civil appln no 102 of 2016 (29 June 2016), para 150.
25 Id, para 143.
26 Id, paras 151–53.
27 Ashworth, APrinciples of Criminal Law (6th ed, 2009, Oxford University Press) at 64Google Scholar.
28 See Hansard of 8 May 2008, above at note 12 at 946 and 951.
29 NDPP v (1) Cook Properties (Pty) Ltd; (2) 37 Gillespie Street Durban (Pty) Ltd and Another; (3) Seevnarayan [2004] 2 ALL SA 491 (SCA), paras 13–14 (Cook Properties). Interestingly, Kenya's Mutual Legal Assistance Act, No 36 of 2011, sec 2 gives a similar definition of instrumentalities.
30 POCAMLA, sec 2.
31 Ibid.
32 For example, the English Proceeds of Crime Act 2002, sec 287 provides that the secretary of state should set a lower limit for the recoverable amount. The Proceeds of Crime Act 2002 (Financial Threshold for Civil Recovery) Order 2003, SI 2003/175 has set the current limit at GBP 10,000.
33 KM Stephenson, L Gray, R Power, JP Brun, G Dunker and M Panjer “Barriers to asset recovery: An analysis of the key barriers and recommendations for action” (2011) at 74–75, available at: <https://www.unodc.org/documents/corruption/Publications/StAR/StAR_Publication_-_Barriers_to_Asset_Recovery.pdf> (last accessed 16 December 2019).
34 Cap 22 Laws of Kenya.
35 This is inferred from the reading of the LAA, secs 4, 26 and 27.
36 See generally, McDermott, H (ed) Investigation and Prosecution of Financial Crime International Readings (2014, Thomson Reuters)Google Scholar. A reading of the various chapters clearly points to the complexity and lengthy process of conducting financial crime investigations. See also, Pasco, GACriminal Financial Investigations: The Use of Forensic Accounting Techniques and Indirect Methods of Proof (2nd ed, 2013, CRC Press) at 57–62Google Scholar.
37 LAA, sec 7.
38 POCAMLA, sec 2.
39 Ryder, N “To confiscate or not to confiscate? A comparative analysis of the confiscation of the proceeds of crime legislation in the United States and the United Kingdom” (2013) 8 Journal of Business Law 767Google Scholar at 784–87 and 791–93. See Proceeds of Crime Act 2002, sec 288, read together with Limitation Act 1980, secs 27A and 32.
40 The Constitution, art 157(6) and Office of the Director of Public Prosecutions Act No 2 of 2013, sec 5.
41 It refers to legal proceedings by one party without the other party being present or participating.
42 See Magistrates’ Court Act 2015, sec 7.
43 The National Police Service comprises two entities: the KPS and the Administration Police Service. See the Constitution, art 243(2).
44 Office of the Director of Public Prosecutions Act, sec 5(a).
45 Id, sec 5(1). The authority with the primary power to investigate all types of crimes in the country is the Kenya Police Service as per the National Police Service Act, cap 84, sec 24(e).
46 The Constitution, art 157(4).
47 Id, art 156(4)–(5).
48 Id, art 243(1) and (2); National Police Service Act, sec 24(e).
49 The DCI has the power to investigate serious crimes by virtue of the National Police Service Act, sec 35(b) and (h).
50 POCAMLA, sec 53(1).
51 Id, sec 54(1).
52 Id, sec 54(1A).
53 Id, sec 54(2).
54 Id, secs 55 and 123. These include the DPP's Office and the National Police Service.
55 Id, sec 82(2).
56 This sub-section provides: “The court shall make an order under subsection (1) if there are reasonable grounds to believe that the property concerned …”.
57 Id, sec 82(3).
58 Kruger Organised Crime, above at note 1 at 119.
59 Ibid. NDPP v Madatt and Another (6488/2007) [2008] ZAWCHC 5, para 9.
60 POCAMLA, sec 89.
61 In criminal forfeiture proceedings, the granting of a temporary restraint order is explicitly permitted under id, secs 68(3) and (4).
62 Civil Procedure Rules 2010, Legal Notice 151 of 2010, order 40(4)(2).
63 POCAMLA, sec 84.
64 The audi altarem partem rule embodies the principle that no person should be condemned unheard in legal proceedings. See NDPP and Another v Mohamed NO and Others 2003 (4) SA 1 (CC) (Mohammed 2), para 51. Ndzengu, NC and Bonde, JC “The duty of utmost good faith in asset forfeiture jurisprudence: Some lessons to learn” (2013) 34/3Obiter 377Google Scholar. Burchell, JMPrinciples of Criminal Law (4th ed, 2013, Juta Publishers) at 904–05Google Scholar; Kruger Organised Crime, above at note 1 at 116.
65 POCAMLA, sec 82(3).
66 See Mohamed 2, above at note 64, paras 29–32 for a discussion on the court giving a temporary order.
67 Meir Elran, above at note 11, para 24.
68 Id, para 23.
69 Id, para 25. A Eissa and R Barber Confiscation Law Handbook (2011, Bloomsbury Professional) at 123.
70 POCAMLA, sec 88(1).
71 Id, sec 88(2).
72 Above at note 64.
73 See R (on application of the Director of the ARA) v Jia Jin He and Dan Dan Chen [2004] EWHC 3021 (admin), para 66.
74 See Director of Assets Recovery Agency v Green [2005] EWHC 3168 (admin), paras 16–20. See also R v Anwar [2013] EWCA Crim 1865.
75 College of Policing “Money laundering (criminal property offences)” (2017) available at: <https://www.app.college.police.uk/app-content/investigations/investigative-strategies/financial-investigation-2/money-laundering/> (last accessed 16 December 2019).
76 Murray, K “In the shadow of the dark twin: Proving criminality in money laundering offences” (2016) 19/4Journal of Money Laundering Control 447CrossRefGoogle Scholar at 449. See also Murray, K “The uses of irresistible inference: Protecting the system from criminal penetration through more effective prosecution of money laundering offences” (2011) 14/1Journal of Money Laundering Control 7CrossRefGoogle Scholar.
77 Ratliff, R “Third-party money laundering: Problems of proof and prosecutorial discretion” (1996) 7/2Stanford Law & Policy Review 173Google Scholar at 174.
78 Durrieu Rethinking Money Laundering, above at note 23 at 327 defines indirect / circumstantial evidence as “the facts or circumstances from which the existence of other facts or circumstances can be deduced through a process of logical interpretation” and proceeds to consider it relevant in criminal proceeds prosecutions. See also Dos Santos and Another v The State [2010] 4 ALL SA 132 (SCA), para 33.
79 Patrick Ogola Onyango, above at note 24, para 151.
80 Bell, RE “Proving the criminal origin of property in money laundering prosecutions” (2000) 4/1Journal of Money Laundering Control 12CrossRefGoogle Scholar at 13–22. Pasco Criminal Financial Investigations, above at note 36 at 107–11.
81 Burchell Principles of Criminal Law, above at note 64 at 907.
82 Ibid.
83 Cook Properties, above at note 29, para 21. See also NDPP v Van der Merwe and Another [2011] 3 All SA 635 (WCC).
84 Cook Properties, id, para 22.
85 See Chappell & Co Ltd v Nestle Co Ltd [1960] AC 87 for a discussion of the difference between sufficiency and adequacy of consideration.
86 Cook Properties, above at note 29, para 23.
87 Takahashi, YA “Proportionality” in Shelton, D (ed) The Oxford Handbook of International Human Rights Law (2013, Oxford University Press) 446Google Scholar at 452.
88 Id at 450–51. Reid, E and Visser, R “Introduction” in Reid, E and Visser, R (eds) Private Law and Human Rights Bringing Rights Home in Scotland and South Africa (2014, Edinburgh University Press) 1Google Scholar at 9; MC Eliya and I Porat Proportionality and Constitutional Culture (2013, Cambridge University Press) at 2.
89 Reid and Visser, ibid. Kruger Organised Crime, above at note 1 at 144.
90 Currie, I and De Waal, JThe Bill of Rights Handbook (6th ed, 2013, Juta Publishers) at 533Google Scholar.
91 Id at 534.
92 Id at 540–47.
93 Multiple Hauliers East Africa Ltd v Attorney General and Ten Others [2013] CHR petition 88 of 2010 [2013] eKLR (19 December 2013), para 34.
94 In dealing with the lawful deprivation of property, Crywan Enterprises Ltd v Kenya Revenue Authorities petition 322 of 2011 [2013] eKLR (15 April 2013) cited with approval FNB and Others v Minister of Finance (CCT19/01) [2002] ZACC 5, a case that enunciated what amounts to arbitrary deprivation of property.
95 POCAMLA, sec 92(1): “The High Court shall, subject to section 94, make an order applied for under section 90(1) if it finds on a balance of probabilities that the property concerned (a) has been used or is intended for use in the commission of an offence; or (b) is proceeds of crime” (emphasis added).
96 Id, sec 92(3).
97 Id, sec 92(4).
98 [2011] UKSC 49.
99 Id, para 19.
100 POCAMLA, sec 92(5). The Kenya Gazette is an official publication of the Government of Kenya.
101 Id, sec 92(6).
102 Id, sec 97.
103 Id, sec 98.
104 Id, sec 99(1).
105 Id, secs 67(5), 68(9), 75(3), 83(3), 89(1), 91 and 96. All these provisions permit affected parties to file applications seeking to protect their interests in targeted property.
106 Brown, DK “Cost-benefit analysis in criminal law” (2004) 92/2California Law Review 323CrossRefGoogle Scholar.
107 Stephenson et al “Barriers to asset recovery”, above at note 33 at 47–49.
108 POCAMLA, sec 115.
109 Boister An Introduction, above at note 1 at 240–41. See also Young, SNM “Introduction” in Young, SNM (ed) Civil Forfeiture of Criminal Proceeds: Legal Measures for Targeting the Proceeds of Crime (2009, Edward Elgar) 1CrossRefGoogle Scholar at 1.
110 Boister, id at 241–42; Gray, A “The compatibility of unexplained wealth provisions and ‘civil’ forfeiture regimes with Kable” (2012) 12/2Queensland University of Technology Law & Justice Journal 18Google Scholar.