Businessman Testifies How Former Director Stole Sh356 Million To Start His Own Company

A Nairobi businessman has detailed in court how his former director allegedly orchestrated a sophisticated fraud scheme, stealing over Sh356 million from their trading company to establish a competing business.

Deepak Rajoria, a key witness in the high-profile case, testified before Milimani Law Courts about how Honey Khatwani, a director at OKI General Trading Limited, was charged with stealing $2,786,174.40 (approximately Ksh.356,711,174.40) between January 1, 2020, and June 30, 2024.

The alleged theft occurred at the company’s premises in Baba Dogo, Nairobi County.

Rajoria painted a picture of systematic financial manipulation, describing how Khatwani allegedly used his position of trust to siphon company funds through multiple channels. According to the testimony, the former director would steal company cheques and deposit the proceeds directly into his personal bank accounts, exploiting his access to the firm’s financial operations.

The fraud allegedly extended beyond simple theft, with Khatwani reportedly creating fraudulent invoices that understated the actual amounts received from clients. This sophisticated scheme allowed him to pocket the difference while maintaining the appearance of legitimate business operations. The businessman further alleged that company employees were unwittingly recruited to deposit stolen cash into Khatwani’s personal accounts.

The elaborate fraud only came to light during an internal audit of Oki General Trading Limited’s financial records. The discovery prompted immediate legal action and revealed the full extent of the alleged financial misconduct.

According to court documents, the stolen funds were allegedly used to establish Galaxy Middle East & Africa, a competing business trading under the name Smart Pro. Company registration records show the rival firm was incorporated on September 23, 2022, with Khatwani and his wife Jayesh Soni listed as the primary shareholders.

The legal consequences have been swift and severe. A Nairobi businessman, Honey Khatwani, accused in a KSh 356m fraud case, lost his multi-million property in Babadogo after a court-ordered auction . The High Court had earlier ordered Khatwani and his wife to pay Sh362 million for breach of contract after they failed to mount a defense in the civil case.

The criminal prosecution has faced some procedural challenges, with the court asking the ODPP for evidence in the ongoing case. However, the matter continues to proceed through the judicial system.

This case highlights the growing concern over internal fraud within Kenyan businesses, particularly involving company directors who abuse their positions of trust. The alleged theft represents one of the largest cases of its kind in recent years, involving substantial sums that were allegedly diverted over a four-and-a-half-year period.

The testimony provided by Rajoria offers a rare glimpse into how sophisticated corporate fraud can be perpetrated from within, using legitimate business processes as cover for criminal activity. The case serves as a stark reminder of the importance of robust internal controls and regular auditing in protecting business assets.

As the legal proceedings continue, the case is being closely watched by the business community, particularly given its implications for corporate governance and fiduciary responsibility among company directors in Kenya.