Fraud under my watch: How I lost Sh86 million to my accountant

Kenyan currency

Kenyan currency.

Photo credit: Jeff Angote | Nation Media Group

A businessman narrated to court how auditors discovered that his company, a service station, had allegedly lost Sh86 million through fraud.

Mr Abdusalaan Noorani told Mombasa chief magistrate Martha Mutuku that between 2015 and 2018 his company Changamwe Service Station Ltd, where he is also a director, was recording losses yet it was making good sales.

Testifying in a case in which the company’s former accountant, Mr Omar Mwapita, has been charged with stealing Sh86 million by servant, Mr Noorani told the court they first asked their group financial controller to conduct an audit before hiring an external auditor.

In his evidence in chief led by state prosecutor Alex Gituma, Mr Noorani told the court that following the audit, the alleged fraud within the service station was discovered.

“The reports of external and internal auditors discovered loss of funds, we reported to the police in Nairobi,” said Mr Noorani adding that the accused was later arrested.

Mr Noorani also told the court that they did not have any dispute with the accused whom he said was crediting wrong figures and making fictitious invoices.

Upon cross examination by defence lawyer Jared Magolo, Mr Noorani denied that one of his companies, Indigo Blue, an offshore company was being used for tax evasion.

“Indigo Blue company is not for tax evasion, it has nothing to do with Changamwe Service Station,” said Mr Noorani.

Mr Noorani said that it was not true that he did not lose any money and denied that he made report to police for a false insurance claim.

The witness told the court that he reported the incident in Nairobi because the accused had a gun and was conversant with people who were a threat to him.

When asked by Mr Magolo to name the individuals who were a threat, the witness said he did not know the accused friends.

“I thought the friends were notorious and also thought the police (in Mombasa) could be influenced,” Mr Noorani told the court upon further cross examination by the defence lawyer.

Mr Noorani said that the accused apart from working for Changamwe Service Station also worked for other companies where he is also a director at least once or twice per week.

The witness upon further cross examination said that money that was deposited in his bank account by the accused was official.

Mr Noorani also told the court that as a director he is not involved in day-to-day activities of the company.

“I have never claimed insurance money, insurance cover was Sh1 million and the loss Sh86 million, it was not necessary,” said Mr Noorani.

Mr Mwapita is alleged to have stolen the money on diverse dates between November 1, 2015, and December 31, 2018, at unknown place within the country.

He allegedly jointly with others not before court being an employee of Changamwe Service Station of Brooke Shield Crescent group, as an accountant and administrator of the company’s quick books accounting software stole the money which came into his possession by virtue of his employment.

Mr Noorani told the court that the accused resigned abruptly in February 2019.

The case has been fixed for hearing on March 27.