The plot recently thickened for major betting firm MozzartBet. A High Court in Kenya has ruled that the operator was harbouring funds that had been proceeds of criminal activities.
The government had frozen some Sh300 million in funds two years ago.
According to Justice Esther Maina’s ruling, money that lay dormant in three different back accounts was part of a money laundering scheme. She ruled that the ill-gotten funds must be forfeited to the government as this was not in line with legal sports betting operational practices.
The Money-Laundering Scheme
According to the official court records, the operator had moved funds to Kimaco Connections as part of the scheme. In Kenya’s Assets Recovery Agency (ARA), a total of SH256 million had been forced to Kimaco in five days, which labelled the money as “suspicious”.
The betting giant later moved the money again, this time to an account held with Co-operative Bank.
MozzartBet’s attempt at an explanation before the court had been that the money had been earmarked for IT software. But evidence suggests it was a cover-up, with Kimaco Connections exposed as a shell company.
According to Judge Maina, it made no sense that the money would have been moved to a sister company – unless to launder money.
Personal Benefits to Shareholders
According to Kimaco Connections, the contract for providing IT services had been subcontracted to another provider, Open Skies Connections. However, the court noted that Peter Kiilu of Kimaco Connections had been unable to substantiate this claim with any agreement or contract as proof.
MozzartBet claimed that the funds had been contributions made by several shareholders. The operator claimed that the only reason the software was never provided was that the government had frozen funds earmarked for the service.
Shareholders in MozzartBet include Sirma, who holds zero shares; MozzartBet Africa, with 700 shares in hand; and Mid Logistics Ltd., a company that owns 300 shares.
According to testimony from the ARA, the money had been transferred in mobile money to avoid detection. This ensured the funds weren’t reported to the Central Bank of Kenya.
More from the ARA
Investigations by the ARA revealed that between February and June, a total of Sh384 million had been moved from MozzartBet to Kimaco Connections. Before being deposited with Co-operative Bank.
A further Sh50 million had been deposited to a fixed deposit account held with the same bank.
According to the ARA, the funds were later moved to various shareholders and directors of MozzartBet.