Kenyan held seven days in $440,000 crypto app fraud

A Kenyan court ordered Dickson Ndege Nyakango held for seven days as detectives investigate an alleged $440,000 cryptocurrency investment fraud that collected money through bank accounts, Paybill numbers and mobile-money channels.

The Directorate of Criminal Investigations’ Capital Markets Fraud Investigation Unit obtained the detention order, telling the court the case involves complex digital records, multiple victims and possible accomplices still at large. Investigators opened the probe after Kestrel Capital flagged a suspicious mobile app listed on Google Play and the Apple App Store.

The app presented itself as an artificial intelligence–powered investment fund linked to Kestrel Capital and a firm called Nathaniel Capital Partners Ltd. Kestrel denied any connection to the platform or to Nathaniel Capital Partners, and investigators began examining impersonation and fraudulent representation.

Detectives allege the platform recruited users through WhatsApp groups, promised returns of up to 7% daily and directed deposits into bank accounts, Paybill numbers and mobile-money wallets. Court filings show one bank account received about $260,200 between April 8 and April 29. Authorities arrested Nyakango on May 4 at an I&M Bank branch on Kenyatta Avenue, where he is accused of attempting to withdraw funds from an account under investigation.

Prosecutors argued that releasing Nyakango could jeopardize the probe while officers trace other accounts and digital platforms, including a second app identified as GSIWEA. The court agreed and ordered Nyakango held at Kilimani Police Station; the matter will return to court later this month.

Investigators are conducting forensic analysis of devices, bank records and app infrastructure to identify beneficiaries and recover funds. The prosecution said it is following multiple digital trails and expects to present further evidence when the case returns to court.

The case comes after Parliament passed the Virtual Asset Service Providers Act in October 2025, which assigns oversight of crypto-based payment services to the Central Bank of Kenya and introduces licensing, anti–money-laundering and consumer-protection rules for exchanges and custodians. Subordinate regulations prepared by the National Treasury are still awaiting gazettement. Regulators continue to warn that unlicensed platforms use social media and messaging apps to target retail investors.