The Tax Appeals Tribunal has granted former Nairobi Governor Mike Sonko a temporary reprieve, directing the Kenya Revenue Authority (KRA) to immediately lift the freeze on his bank accounts.
The ruling comes as the tribunal emphasized that the disputed tax amounts cannot be collected until his appeal is fully determined.
Delivered on 14 November 2025, Tribunal Member Hon. Dr. Rodney O. Oluoch instructed KRA to unfreeze Sonko’s accounts at Equity Bank and Co-operative Bank. Dr. Oluoch warned that failure to comply with the order would attract legal consequences, providing Sonko a brief relief in the ongoing tax dispute.
Despite the tribunal’s decision, Equity Bank says it is caught between conflicting directives from KRA and the Asset Recovery Agency (ARA). Both institutions have issued instructions requiring opposing actions on the same accounts, leaving the bank in a legal dilemma.
Court filings indicate that Sonko holds five accounts in Kenyan shillings and one in US dollars at Equity. The bank notes that following one agency’s instructions could breach the other’s directive. Equity has therefore sought judicial guidance to clarify which agency’s position takes precedence.
Previously, KRA issued an agency notice claiming over Sh574 million in unpaid taxes. ARA later notified the bank that the same funds were alleged proceeds of crime, even after a High Court ruling by Justice Nixon Sifuna had set aside earlier preservation orders against Sonko.
Sonko, through his lawyers, has written to Equity demanding access to his funds, asserting that Justice Sifuna’s judgment removed any lawful basis for maintaining the freeze.
In an affidavit, Equity’s Business Development Manager Gregory Akoth explained that he sought clarification from the Ethics and Anti-Corruption Commission (EACC). EACC officer Shem Shurie responded, stating that ARA had issued preservation orders pending the full implementation of the High Court decision.
ARA cited Section 97 of the Proceeds of Crime and Anti-Money Laundering Act (POCAMLA), arguing that property under a preservation order should remain restricted until a final ruling is made.
However, courts have previously clarified that preservation orders do not automatically continue without explicit judicial instruction and must align with the court overseeing the case.
Faced with overlapping judgments, conflicting legal provisions, and competing agency directives, Equity maintains it cannot release the funds or continue the freeze without risking legal liability. The bank has asked the court to provide a conclusive resolution to the standoff.
