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KCB Dragged To Court Over Claims Of Defrauding Tax Collector



Kenya Commercial Bank (KCB) is under the spotlight for being involved in some fraudulent activity, to defraud Uganda’s Revenue Authority out huge amounts of money in tax.  A commercial court case file number 347 of 2020 filed by a company called Netcom General Supplies has lifted a lid on the seriousness and dirty fraud going on within the Kenyan bank’s operations in Uganda. Netcom General Supplies sued KCB for infringing on their Tax Identification Number (TIN) in their attempt to dodge paying tax, and possibly, orchestrating an internal fraud.

The revelation came to the fore after KCB was caught pants down using another company’s TIN to file returns claiming they were suppliers to the bank, yet, the two had never done any business transactions before. The Kenyan bank faces heavy penalties once the court case is concluded.

The proceedings in court are expected to be an eye-opener and could see heads rolling at KCB. The fraud came to the fore after Uganda Revenue Authority issued an assessment for taxes for Netcom, which is when the company realised they had not supplied a client in the name of KCB, the bank is said to have frequently used their TIN.

‘KCB used Netcom TIN claiming that Netcom supplied the bank with items, which turned out to be a lie. They filed their returns showing that Netcom dealt with KCB,’ says an anonymous source at Netcom. When URA confronted Netcom with a huge tax demand, they denied having ever conducted any business transactions with KCB which prompted the management to follow up on the matter with KCB Uganda, KCB claimed that they had purchased raw materials with a value of Ush.150 million.

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The material was dustless chalk, many people were left asking what the hell was the bank doing in purchasing ‘dustless chalk’ for?  URA slapped Netcom with a tax bill of Ush.4,988,379 in taxes which the company insists KCB Uganda should pay. KCB has admitted to the accusation, but alleges that the bank used Netcom’s TIN ‘in error’, a claim the latter does not take lying down because it has cost them a lot.

Netcom’s lawyers JP Muganga stated that their client lost business as a tax agent due to the falsification of tax documents by KCB Uganda.

However, this is not an isolated case as KCB has had troubles with the Uganda’s taxman. In 2016, URA suspended KCB from its portal rendering it unable to offer tax payment services citing ‘critical issues’.

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