Kenya has struck a deal with the Jersey government for repatriation of more than Sh380 million it confiscated from a company associated with former Kenya Power managing director Samuel Gichuru.

The cash has been at the centre of a long-running money laundering suit in the English Channel Island.

The deal paves the way for handing over of the money to the National Treasury nearly two years after Mr Gichuru’s firm, Windward Trading Limited, pleaded guilty to money laundering in the British Crown dependency and surrendered the assets.

The agreement includes refunds to Jersey for legal and investigation costs incurred in pursuit of Windward, amount to be repatriated to Kenya and projects to be funded by the confiscated cash.

The seized cash will be used to develop renewable energy projects that have an impact on education amongst vulnerable communities in arid and semi-arid areas, said Jersey.

“The signing of this agreement conveys a powerful message that Jersey and Kenya are committed to combating historic corruption and financial crime,” Chief Minister of Jersey, Senator Ian Gorst, said in a statement.

Windward Trading Limited’s offshore account is said to have been used to receive kickbacks in exchange for the award of lucrative tenders to foreign firms during Mr Gichuru’s two-decade tenure at the helm of Kenya Power.

UK government’s policy does not allow public funds recovered from proceeds of crime to return to the exchequer, but deploys them for use in supporting the social sector.

Kenya had initially indicated that it was keen to spend the money in building and managing drug rehabilitation centres.

Treasury principal secretary Kamau Thugge said it was important that “Kenya reaches an agreement with the government of Jersey on this important matter.”

The asset seizure in Jersey came as Mr Gichuru and former Energy minister Chris Okemo continue their epic court battle in Kenya against extradition to the Channel Island to face criminal charges.

A court in Jersey issued a warrant for the duo’s arrest on April 20, 2011 – but the two have challenged the move through multiple legal suits in Kenyan courts.

The Court of Appeal temporarily stopped the extradition of Mr Gichuru and Mr Okemo after the two contested a High Court decision that allowed their transfer to the island to face criminal charges. The matter is expected to be heard this month.

Windward, a Jersey-registered company, in February last year pleaded guilty to four counts of money laundering in Jersey’s Royal Court, prompting the court to issue orders to seize the £3.28 million and $540,330.69 (Sh468 million) held in the firm’s offshore account.

But Mr Gichuru disowned the guilty plea, insisting that persons unknown to him had represented Windward Trading in a court process that took only 16 days before his assets were seized.

He said that his lawyers in Jersey were not aware of the court proceedings and that he had never issued instructions to any persons to represent Windward in the Royal Court — raising questions as to who pleaded guilty to the offence.

Mr Gichuru had challenged the court to provide him with details of the persons who allegedly represented him in the proceedings and the basis of their authority to commit the company to any matter.

The Jersey authorities explained why the deal reached with the Treasury was based  on a lower figure of Sh380 million compared to the sum declared last February of Sh468 million at current exchange rates.

Jersey said it partially deducted costs for pursuing Windward and seizing its assets.

“It should be noted that the Government of Jersey is not recouping the full cost incurred in the investigation and proceedings,” said Jersey in an email response to the Business Daily.

The English Channel Island said it had taken out Sh88 million to settle part of the legal costs amounting to Sh103 million incurred during nine years of investigation and prosecution.

The Treasury last month informed Parliament that Sh43.74 million seized from a British firm that bribed electoral and examinations council officials to win tenders had been wired to Nairobi.

London’s Southwark Crown Court on January 8, 2016 seized the assets of Smith & Ouzman — the UK printer at the centre of the bribery scam — and ordered it to pay a total of £2.39 million (Sh309 million) in fines and penalties for paying Independent Electoral and Boundaries (IEBC) and Kenya National Examinations Council (Knec) executives bribes codenamed ‘chicken’.

The court ordered that £349,057.39 — equivalent to the hefty bribes dished to the IEBC and Knec officials — be repatriated to Kenya. The cash will be used to buy ambulances.

Former IEBC chief executive James Oswago and two junior officials were last month charged with bribery in the chickengate affair.