Eight assets linked to Jean Emmanuel Morlon escaped forfeiture after Justice Benjamin Musyoki found investigators had failed to trace them convincingly to alleged criminal proceeds. The ruling follows a 2025 police operation in which five suspects were arrested over an alleged gold scam targeting two foreign businessmen.
The High Court has rejected the state’s attempt to seize assets linked to a controversial gold transaction involving foreign businessmen.
Justice Benjamin Musyoki ruled that investigators had failed to establish the necessary connection between disputed property and alleged criminal proceeds.
The October 16, 2026, judgement dismissed the Assets Recovery Agency’s forfeiture application with costs.
The decision came nearly 20 months after detectives arrested five suspects over an alleged KSh15.5 million gold scam.
The targeted assets included a Toyota Land Cruiser, a Land Rover Defender, and two motorcycles.
Investigators also sought forfeiture of four bank balances held at Diamond Trust Bank.
The ruling exposes a critical weakness in the agency’s case: investigators had suspicious transactions but insufficient evidence linking them to specific assets.
The Gold Deal
In February 2025, the Directorate of Criminal Investigations identified Jean Emmanuel Morlon among five suspects arrested over an alleged gold scam.
Police said two foreign businessmen had lost USD120,000, approximately KSh15.5 million, in the disputed transaction.
According to the DCI, the businessmen were told that 550 kilograms of gold awaited clearance at Jomo Kenyatta International Airport.
The shipment was allegedly scheduled for Dubai on January 20, 2025, following payment.
The suspects included Morlon, also known as Lamarca J. Benjamin, alongside Samson Kibet Sirkoi, Lucy Gitonga, Rose Kambua, and Justine Adhiambo.
Detectives recovered firearms, ammunition, expired mineral licences and other items during the operation.
They also recovered a silver Toyota Land Cruiser, registration KCW 880M, later targeted in forfeiture proceedings.
These allegations formed part of the background to the agency’s subsequent attempt to recover suspected criminal proceeds.
The Disputed Money
Court documents indicate that the proposed cargo transportation arrangement was priced at USD120,000.
The interested parties alleged that USD27,000 was paid in cash, while USD93,000 entered Afrex Bridge Connection Ltd-Curlcy’s dollar account.
The latter transfer came from Ferdinando G. Mercuri, who reportedly advanced the businessmen a loan.
The interested parties also cited transfers involving USD21,500 and 21,000 Swiss francs.
They accused Morlon of falsely representing his ability to arrange the chartered flight.
Morlon, however, maintained that the arrangement was legitimate and encountered contractual and regulatory difficulties.
He disputed the receipt that investigators relied upon and insisted that the USD27,000 had been refunded.
The judge did not determine whether the underlying transaction amounted to fraud, leaving that question unresolved.
The agency alleged that money moved through companies associated with Morlon before reaching other accounts.
Investigators questioned cash deposits, intercompany transfers, and the sources of funds used to acquire vehicles.
Evidence Falls Short
Justice Musyoki found that the existence of criminal charges could not establish that particular assets were proceeds of crime.
The agency had cited a separate 2019 fraud case but failed to connect those allegations convincingly to the property.
The judge also criticised investigators for relying heavily on bank statements without adequately pursuing suspicious transactions.
Several entries contained descriptions identifying their sources and purposes, yet the agency offered insufficient explanations.
Investigations, the court stressed, must extend beyond collecting account statements and identifying unusual entries.
Investigators should seek supporting documents, trace transfers, and establish whether funds originated from unlawful activities.
The judge accepted that Morlon and the companies were financially connected.
However, those relationships did not independently prove that the disputed assets represented criminal proceeds.
He also noted a significant discrepancy between the charge sheet and the interested parties’ account.
The charge sheet attributed USD93,000 to Mercuri, while the interested parties said he had financed their payment.
The judge declined to resolve that discrepancy because the underlying allegations remained before another court.
Instead, he concluded that the agency had failed to establish sufficient grounds for forfeiture.
Assets Survive
The judge determined that the vehicles and motorcycles were acquired prior to the alleged January 2025 transaction.
Investigators had not sufficiently demonstrated that those assets were purchased using proceeds from that disputed arrangement.
Under the Proceeds of Crime and Anti-Money Laundering Act, the agency must establish a credible connection between property and criminal conduct.
The evidential burden can only shift towards the property holder after satisfying that initial burden.
The judgement drew on Supreme Court and Court of Appeal authorities emphasising this requirement.
A criminal conviction is unnecessary for civil forfeiture, but credible evidence linking property to crime remains essential.
The ruling also distinguished state forfeiture from victims’ attempts to recover money through commercial disputes.
The interested parties wanted recovered funds deposited into an account they controlled, but the judge declined that request.
He explained that forfeiture proceedings were not designed to settle contractual disputes or determine competing ownership claims.
Such claims ordinarily require separate civil proceedings, where the parties’ proprietary rights can be properly examined.
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Justice Musyoki consequently dismissed the application seeking forfeiture of the eight assets.
The decision did not acquit Morlon or resolve the underlying criminal allegations against him.
Instead, it delivered a pointed reminder to investigators pursuing suspected criminal wealth.
Suspicion may justify scrutiny, but the state must establish an evidential connection before taking property through forfeiture.
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