Asset recovery in Kenya runs through two quite different legal channels, and picking the right one, or knowing when to use both, determines whether a fraud victim or a state agency actually gets the money back. A private litigant chasing a fraudster or a defaulting counterparty uses the civil freezing injunction. A state agency recovering the proceeds of corruption or money laundering uses the civil forfeiture regime under a specific statute. The two share a common enemy, the risk that assets disappear before a court can rule, but they operate under different rules, different burdens of proof, and different institutions.
Freezing Orders in Private Litigation
Kenyan courts have adopted the English Mareva injunction, now more commonly called a freezing order, as a tool to stop a defendant from dissipating assets before a claimant can enforce a judgment against them. Courts have grounded this remedy in different provisions of the Civil Procedure Rules 2010 across different cases, some treating Order 39 rules 5 and 6 as the relevant statutory codification, others applying Order 40, which addresses property in danger of being wasted, damaged, or alienated. Practitioners should treat this as an area where the precise procedural basis pleaded matters less than satisfying the substantive test the courts have consistently applied: a good arguable case based on a pre-existing cause of action, a claim over which the court has jurisdiction, evidence that the defendant has assets within the jurisdiction, a real risk that those assets will be removed or dissipated if the injunction is not granted, and a balance of convenience favouring the order. Kenyan courts have been explicit that this is a discretionary remedy used in limited circumstances, not a routine litigation tactic, and have warned against freezing a party’s assets and impeding its business lightly.
Because a freezing order is typically sought ex parte, without notice to the defendant, the applicant carries a strict duty of full and frank disclosure, meaning it must put before the court every material fact, including facts unfavourable to its own case, not just the facts that support the application. An order obtained by concealing an inconvenient fact is vulnerable to being set aside the moment the defendant discovers the omission, regardless of how strong the underlying claim otherwise is. The applicant must also give an undertaking to compensate the defendant for losses caused by the order if it later turns out to have been wrongly granted, which means a freezing application is not a costless or risk-free step to take defensively.
Civil Forfeiture Under POCAMLA: A Different Tool for Proceeds of Crime
Where the asset in question is suspected to be the proceeds of corruption, money laundering, or another crime rather than simply the assets of a private debtor, the relevant tool is civil forfeiture under the Proceeds of Crime and Anti-Money Laundering Act (POCAMLA), pursued by the Assets Recovery Agency (ARA), a body corporate established under section 53 of the Act. The ARA typically proceeds in two stages: an ex parte preservation order freezing the asset while the underlying investigation and forfeiture case proceeds, gazetted under section 83(1), followed by an application for a final forfeiture order under section 90. A defining feature of this regime, confirmed in Kenyan case law, is that civil forfeiture does not require a criminal conviction, since Part VIII of POCAMLA and section 92(4) specifically provide that the civil proceedings are unaffected by the outcome of any related criminal case. This makes the civil route considerably more usable than waiting for a criminal prosecution to conclude, since a criminal trial and conviction are often years away, if they happen at all.
That said, this civil route has real limits that a 2026 Supreme Court decision sharpened considerably. In a closely watched case involving funds held by the wife of a former Kenya Revenue Authority official, the Supreme Court rejected the ARA and Ethics and Anti-Corruption Commission’s argument that suspicious banking patterns and unexplained wealth alone were sufficient for forfeiture, holding that the existence of an actual connection to criminal conduct remains central to any forfeiture order, and that agencies cannot shift the burden onto the asset holder merely by pointing to suspicious deposits. The Court also drew a sharper line between POCAMLA forfeiture, which requires evidence connecting property to a specific crime, and the separate unexplained-wealth recovery mechanism under the Anti-Corruption and Economic Crimes Act, which is not the same test. For a business or individual facing a preservation order, this means the evidentiary burden on the state is real and litigable, not a formality that automatically follows from an ex parte order having been granted.
Tracing Assets Once They Have Moved
Both routes frequently require the additional step of tracing, following property, or funds into which it has been converted, through a chain of transactions to identify where it ended up. Kenyan courts have applied tracing principles most readily in cases involving breach of trust, misappropriation of trust property, and proceeds of crime, allowing property to be followed and recovered so far as it remains identifiable, even after conversion into a different form or asset. This matters practically because a fraudster who moves cash into property, vehicles, or a third party’s account has not necessarily placed it beyond reach, provided the claimant or agency can establish the transactional chain connecting the current asset back to the original wrongdoing.
The Cross-Border Reality
A Kenyan freezing order or preservation order binds parties before the Kenyan court but does not automatically compel a foreign bank or registry to act. Recovering assets moved outside Kenya generally requires either a mirrored application in the foreign court where the assets are actually located, or mutual legal assistance between Kenya and the relevant foreign state, a process that is slower and more dependent on the receiving state’s cooperation than domestic litigants often expect. Businesses and agencies planning a recovery strategy against assets suspected to have moved abroad should build this timeline into their expectations from the outset rather than treating a domestic order as the end of the exercise.
Asset recovery frequently intersects with a business’s broader compliance obligations. Where suspicious transactions triggered the underlying investigation, our guides to Financial Reporting Centre reporting obligations and sanctions compliance for Kenyan businesses cover the AML reporting duties that often run alongside a recovery action. Once a judgment or forfeiture order is secured, our guide to enforcing judgments in Kenya covers the execution options available to actually convert the order into recovered funds.
For advice on freezing injunctions, tracing claims, defending or pursuing POCAMLA preservation and forfeiture proceedings, and cross-border asset recovery strategy, consult our litigation and dispute resolution practice. We advise clients across Kenya from our offices at Nextgen Mall, Nairobi.
