THE amnesty granted by President John Magufuli to persons charged with economic sabotage is real.
This is evidenced in a case involving two representatives of Uganda based Pyramid Scheme, D9 Club. Having confessed to the crimes they were charged with, the court gave them lenient sentences so they could get out of prison easily.
Instead of paying a fine ranging between 1bn/-and 5bn/-, the convicts, under the presidential pardon, were allowed to pay 100m/-only.
Our Staff Writer FAUSTINE KAPAMA more reports… Magdalena Uhwello and Halima Nsubuga, who are representatives of D9 Club, a Ugandan Pyramid Scheme, were previously charged with seven economic counts of conducting a pyramid scheme and money laundering at the Kisutu Resident Magistrate’s Court in Dar es Salaam.
Among those counts, one related to conspiracy to commit an offence, another one concerned conducting a pyramid scheme and the rest, that is five counts, were for money laundering.
Whoever is convicted of conspiracy in terms of section 384 of the Penal Code is liable to seven years imprisonment, while a person convicted of conducting a pyramid scheme as per section 171A (1) and (3) of the Penal Code is liable to five years imprisonment or pay fine of 5m/-.
Under section 12 (b) and 13 (1) (a) of Anti-Money Laundering Act, read together with Paragraph 22 of the First Schedule to and section 57(1) and 60 (2) of the Economic and Organised Crime Control Act, one is sentenced to 20 years imprisonment or pay a fine ranging 100m/-to 500m/-for money laundering.
After President Magufuli had announced the amnesty, giving six days to persons charged with economic crimes to apply for the pardon, Magdalena and Halima wasted no time and promptly wrote letters to the Director of Public Prosecutions (DPP), indicating their desire to confess to crimes.
It was like testing what could be the result thereafter, but the move by the duo paid off as the DPP dully accepted their letters. Under the presidential amnesty spirits, he thereafter called off the case file and reviewed the charges the two accused persons were charged with from seven counts to two charges.
The five money laundering counts were reduced into one, while the conspiracy charge was completely dropped. Since the case was economic one, the DPP acted under section 12 (3) and (4) and 26 (1) of the Economic and Organised Crime Control Act and issued a consent to the court to hear the case.
Senior State Attorney Wankyo Simon and State Attorney Jacqueline Nyantori, on behalf of the DPP, presented the new charges against the two accused persons before Resident Magistrate Vick Mwaikambo. The two accused persons pleaded “guilty” to the charges.
Having convicted them on their own plea of guilty to charges of conducting a pyramid scheme and money laundering, the magistrate ordered the two convicts to pay a total fine of 100m/- for one substituted count of money laundering or go to jail for 20 years in default of paying the fine.
She also directed the convicts to pay a fine of 1m/-for conducting the pyramid scheme or remain behind bars for one year in default of paying the fine in question. The magistrate clarified that the two convicts will share the monetary sentence, meaning each would pay 50,500,000/-only.
Had it not been the presidential amnesty, the two convicts would have been sentenced to pay fine ranging 100m/-to 500m/-each for every money laundering count they were previously facing and 5m/-everyone for one count of conducting the pyramid scheme.
Since every convict was previously charged with five counts of money laundering, the government would have earned a total sum ranging between 1bn/-to 5bn/-and other 10m/- for operating the pyramid scheme if the prosecution was to prove the charges beyond reasonable doubt.
But due to the presidential amnesty, the two are to pay a total sum of 101m/-only for money laundering and conducting the pyramid scheme. This is the only money the government will get instead of getting between 1bn/-and 5bn/-if the two accused were to be convicted without the amnesty.
However, when delivering the sentence, the magistrate took into consideration the application by the prosecution, which was also accepted by the two convicts for the court to invoke the provisions of section 60 (3) of the Economic and Organised Crime and Control Act.
Such section was applied to forfeit as government property a total sum of 370,000 US dollars being proceeds of the pyramid scheme deposited in bank accounts. Following the court’s confiscation order, the government managed to get a total sum of 992m/-.
The facts of the case indicate that Magdalena Uhwello and Halima Nsubuga are Tanzanians and businesswomen residing at Bunju B and Biafra Kinondoni in Dar es Salaam, respectively. In April 2017, the accused persons conspired with one Smart Protus Magara, a Ugandan Citizen to conduct the pyramid scheme known as D9 Club.
Magara is said to be the East African Coordinator of the pyramid scheme. The two convicts agreed to join the pyramid scheme and being Tanzania country representatives of the Club and were vested with the duty of recruiting new members and accept deposits.
It was alleged that the mode adopted by the accused persons in recruiting new members were through seminars and networking through social media and WhatsApp groups. Furthering the criminal syndicate and for smooth collection of funds from the new recruited members, the accused persons opened a joint account at Equity Bank Tanzania Limited.
Between April 19 and 28, 2017, the duo managed to solicit several Tanzanians who deposited a total sum of 370,000 US dollars. Such amount was deposited into the bank account. The Director of Criminal Investigations received intelligence information that the accused persons have engaged themselves in D9 Club activities which is a pyramid scheme, hence, mounting investigations on the matter.
The investigations revealed that D9 Club is a pyramid scheme with all features as it indicated not to be able to run forever because there was finite number of people to join the Club and the cycle was impossible to sustain itself and those down the line will lose their money.
It was revealed also that people were deceived into believing that giving money will make money, however no wealth created, no product to be sold, no investment has been made and no services has been provided.
More investigations unveiled that the practice of recruiting someone to invest in order to receive a high return on the investment and members were required to recruit new members into multi-level market to make profit.
Further investigations indicated that D9 Club has no any legal business allowing it to receive deposits from the public but they were only illegally receiving money from the public on promise that members who join the Club will be paid in future more than what they paid.
On diverse dates between April 20 and 25, 2017, after they had illegally collected the money from members of the public, in disguise the illegal source of the money, the accused transferred 263,567 US dollars to an account in the name of Magara maintained by Equity Bank Uganda.
The balance of the money in the joint account in the name of Magdalena and Halima at Equity Bank Tanzania Limited was 124,433.89 US dollars. Such money was restrained by an order of the court for being withdrawn as being proceeds of crime of conducting the pyramid scheme.
Dr Magufuli had on September 22, 2019, while swearing in various leaders whom he had appointed, advised the DPP to consider dropping charges facing economic crime suspects through the legal channels should the accused persons confess their crimes and re-pay the loss involved.
He assured the suspects and others who have not responded that the amnesty was genuine. “The pardon is for real and don’t be cheated that once you confess the government will proceed with the charges. “I understand that some lawyers representing the suspects are misleading their clients by advising them not to respond but these (the lawyers) are just doing this to continue minting money from their clients,” the Head of State stated.
President Magufuli directed the DPP to expedite procedures for early release of the suspects through legal channels.