The suspects are accused of involvement in a scheme allegedly using fictitious tax invoices to facilitate unlawful VAT refunds and reduce tax liabilities.
The Director of Public Prosecutions (DPP) has approved charges against five individuals and 12 companies over an alleged scheme to defraud the government of approximately KSh3.9 billion in Value Added Tax (VAT).
The decision follows joint investigations by the Office of the Director of Public Prosecutions (ODPP) and the Kenya Revenue Authority (KRA), which reviewed 70 inquiry files linked to the suspected tax fraud.
According to the ODPP, investigators uncovered a network of companies allegedly operating as “missing traders” to generate fictitious transactions and electronic tax invoices.
The invoices were reportedly used by other businesses to claim VAT refunds unlawfully or reduce their tax liabilities despite no genuine purchases having taken place.
Five Individuals Named in the Investigation
The five individuals identified in the investigations are Henry Ateka Nyabwari, James Ojiambo Nyengenye, Amisi Zamda, Frank Nyabwari and Hesbon Onyoni.
They are alleged to have been involved in registering 70 companies that investigators believe were instrumental in executing the scheme.
The allegations are subject to prosecution, and the individuals are presumed innocent unless proven guilty in court.
36 Cases Approved for Prosecution
Following its review of the inquiry files, the DPP approved prosecution in 36 cases involving transactions valued at approximately KSh3.22 billion.
The transactions are linked to an alleged VAT loss of approximately KSh518 million.
Of the 36 cases, six have been prioritised for immediate prosecution. These cases involve an estimated VAT implication of KSh17 million.
The ODPP and KRA are pursuing the cases as part of efforts to address suspected tax fraud and protect government revenue.
Further proceedings are expected to determine the responsibility of the accused individuals and companies.
The case highlights the role of electronic tax invoices in VAT compliance and the risks posed by fictitious transactions within the tax system.
