Kenyan Investigators Freeze $751,853 in USDT as Binance Wallet Probe Widens Further

Parallel Channels Used to Evade Detection

Kenyan investigators have seized and frozen at least $888,030 (115 million Kenyan shillings) linked to two residents after tracing a multi-layered money laundering operation that allegedly moved more than $2.32 million through shell firms, bank accounts, remittance services and cryptocurrency wallets.

Court documents filed by the Assets Recovery Agency (ARA) state the frozen funds include USDT held in Binance accounts alongside cash distributed across multiple banks. The frozen digital assets include $751,853 linked to Glory Kithure and $896 linked to Michael Machimbo. Investigators also seized $135,000 spread across nine accounts at over five banks.

The agency said the scheme relied on two parallel channels designed to obscure the origin of the money and evade detection. In the first channel, funds were sent via international remittance services into Kenya through intermediary individuals and companies before reaching the respondents’ bank accounts.

Court filings identify several intermediaries, including Justice Gaturu and Richard Mwangi, as well as two firms named as sources of funds: DigitalMall Global Ltd. and Bitflux Fintech Ltd. The money was then allegedly relayed through two additional individuals before being deposited into accounts held by Machimbo and Kithure.

Between October 2022 and January 2024, Machimbo received approximately $620,000 in his Equity Bank accounts from Michael and another intermediary, Kevin Kipngeno, according to investigators. Filings also show that about $130,000 was transferred to Machimbo’s Stanbic Bank account from Bitflux Fintech Ltd. during the same period.

For Kithure, the ARA documented 57 bank transfers totaling $412,000 between July 2022 and May 2025. Individual transfers ranged from $77 to approximately $4,250 — amounts investigators say were deliberately kept below anti-money laundering reporting limits. Under Kenyan law, cash transactions of $15,000 or more and cross-border transfers of $10,000 or more must be reported to the Financial Reporting Centre.

“The repeated use of amounts just below the reporting threshold is consistent with the structuring of transactions to avoid regulatory reporting requirements,” the ARA said in court filings, noting that the pattern reflects the “layering” stage of money laundering.

The agency further alleged that incremental transfers were used to integrate illicit funds into the banking system before they were spent. In one instance in November 2023, Gaturu received two payments totaling $7,000 from the U.S. payment platform Chime. Gaturu then transferred $8,400 to Mwendwa’s Equity Bank account in three installments. Mwendwa then forwarded the funds to Michael, who dispersed them into Kithure’s bank account.

The second channel involved tether stablecoins routed through multiple Binance exchange accounts to sever ties to their sources.

The ARA said investigations remain ongoing, and Kenyan authorities dispatched a request for mutual legal assistance to the U.S. government in May 2026 to obtain international financial records.

The court action comes as Kenyan authorities step up enforcement against illegal financial flows involving cryptocurrencies, amid concerns that digital assets are being used to bypass traditional financial monitoring systems.