Police have arrested four suspects linked to fraudulent vehicle logbook dealings in the country.
According to the Directorate of Criminal Investigations (DCI), the four are being held for forgery and using the document to fraudulently obtain credit in a scam involving some officials working with the National Transport and Safety Authority (NTSA).
In a case currently being investigated by detectives based at the NTSA, the Cooperative Bank of Kenya had last year financed one Gideon Kiarie, to acquire a lorry after making a deposit of Sh1.2 million.
DCI said the rest of the payment was to be settled in monthly installments of Sh166,000. The lorry was registered under Kiarie and Cooperative bank. Along the way, Kiarie experienced difficulties in remitting the monthly deposits.
“He looked for a buyer and they entered into a local arrangement where the buyer was given the lorry on condition that he would be depositing the monthly installments, in Kiarie’s account, until the facility was fully serviced,” DCI said on Friday.
“But in an unfortunate twist of fate, the new owner of the truck died a few months afterwards, before completing making the payments.”
The deceased’s son took custody of the vehicle and started looking for a new buyer since he wasn’t interested in the truck business.
“Unbeknownst to him and many other Kenyans there exists a cartel targeting vehicle owners who advertise their vehicles for sale,” DCI said.
According to the DCI, the fraudsters approach the vehicle owners posing as genuine buyers, test drive the vehicle and when they ascertain its condition, collude with crooked NTSA officials and have the vehicle registered under their names.
“This is what happened to the owner of the lorry after a man identified as Frederick Kilonzo approached him, expressed interest in the truck and wrote him two bouncing cheques worth Sh1.3Million,” DCI revealed.
Apparently, by the time the owner realized that the cheques could not be honoured, Kilonzo had tampered with the lorry’s tracking system and courted new buyers.
In an intricate web of fraudsters, the initial ownership details of the lorry in respect of Gideon Kiarie and Cooperative bank were also erased from the NTSA portal and replaced with others. The new owners were Frederick Kilonzo and MyCredit limited a finance company that provides asset financing in 24 hours.
The new documentation instantly earned Kilonzo a loan of Sh2.8 million from MyCredit limited.
Detectives established that Sh1.5M was immediately disbursed to Kilonzo, even before the vehicle’s insurance details were ascertained.
The detectives are still investigating who were the beneficiaries of the remaining Sh1.3 million.
In a shocking turn of events, the lorry, DCI said, was auctioned by MyCredit limited at Sh4.5 million within 10 days.
“In a well-choreographed scheme with the assistance of a top manager identified as Patrick Kimeu Mutisya, the truck that had been insured by cooperative bank against a value of Sh6.5 million was sold for a song to one John Muigai,” DCI added.
When he was was questioned by detectives, Muigai said that he did not participate in any public auction but was only called and informed that there was a lorry being auctioned by Mycredit at a mouthwatering price. It is while Muigai was regularizing the vehicle’s ownership, that he shockingly learnt that the lorry did not belong to Frederick Kilonzo and MyCredit limited as he had been made to believe.
When detectives launched investigations into this high level scam, they contacted cooperative bank that had insured the lorry only for the bank to disclose that they were still the owners of the truck and had not transferred its ownership to anyone.
DCI said a search at the NTSA portal revealed that the original details of the vehicle’s ownership had been amended and replaced with Frederick Kilonzo and MyCredit limited.
Police said detectives have since established that crooked officials at the National Transport & Safety Authority who claim that the system was hacked into, working with brokers and unscrupulous traders, had developed new documentation for the lorry and used the fake papers to acquire the loan.
The suspects are being processed before arraignment in court to answer to charges of obtaining credit by false pretences, forgery, uttering a false document, issuing of bad cheques and fraudulent disposition of mortgaged goods.