How SportPesa Laundered Sh30 Billion To OffShore Accounts

How SportPesa Laundered Sh30 Billion To OffShore Accounts

Once Kenya’s largest bookmaker, SportPesa is now facing an ultimate demise after a new probe by The Financial Reporting Centre (FRC) established that the sports betting firm allegedly wired $278 million (Sh30 billion) from its local accounts to offshore banks illegally.

FRC which is a State agency tasked with tracking illicit money will seek to establish if the billions of shillings earned by the online betting website in Kenya were declared to the gaming regulator, the Betting Control and Licensing Board (BCLB).

SportPesa allegedly transferred the Sh30 billion to the tax havens that are Isle of Man, the Canary Islands as well as Dubai over a three-year period.

The FRC will also be tasked with finding out if the bookmaker paid taxes on the Sh30 billion.

In fear of being found guilty and losing the billions of shillings, Wealthy, politically influential Kenyans and Bulgarian investors who helped to found SportPesa have started losing their calm triggering a bitter fallout. They have since come out and started distancing themselves from the transfer of the money.

According to Kenyan entrepreneurs Paul Wanderi Ndung’u and Asenath Maina, who own a combined 38 percent stake in SportPesa’s holding company Pevans East Africa, there has been a shareholder war that has been simmering since 2017 over the transfer of the billions of shillings to the offshore accounts.

The shareholder fight in the sports betting platform is pitting local majority shareholders against its foreign owners from Bulgaria in a row that erupted into public light when SportPesa announced its return under Milestone, a business licensed last month.

Mr. Ndung’u had said that local top shareholders of Pevans East Africa, were illegally excluded from buying shares in the holding company — SportPesa Global Holding Limited (SGHL) — leading to dilution of their ownership in the UK-based firm.

It is after the fallout that the shareholders demanded a forensic audit on the company starting from 2015, a push that has been resisted.

“After persistent push, the management report indicated that within three years Pevans has transferred over $250 million (Sh27.1 billion) to various offshore accounts in Isle of Man, Dubai, and Las Palmas/Canary Islands,” Mr. Ndung’u said.

“Shareholders have also come to learn that subsequent to ceasing operations, $500,000 (Sh54.3 million) has been transferred from Pevans to SportPesa South Africa while another $17.5 million (Sh1.9 billion) has been transferred to Sportpesa Tanzania. We want to know who the beneficiaries of these accounts are.”

“The matter is of public interest, and we will investigate to establish if there was criminality in the movement of the billions offshore,” said Saitoti Maika, the Director-General of FRC.

“We emphasize that moving money offshore is not an illegality, our mandate is to establish if there were breaches in regards to cash movement.”