Bidco Africa Chairman Vimal Shah told a Kenyan court that he lost KES 102.4 million, or about $790,000, in a foreign-exchange transaction after trusting former capital-markets executive Nicholas Nesbitt to source U.S. dollars for his company during a period of dollar shortages.

Shah testified that Nesbitt approached him in May 2023 with a proposal to convert Kenyan shillings (KES) into U.S. dollars within 24 hours. The proposal followed earlier foreign-currency transactions between the two that had failed.

Nesbitt introduced British national Bulent Boitoru as his business partner and described him as an expert in using cryptocurrencies and stablecoins to facilitate currency conversions, Shah said. Stablecoins are blockchain-based tokens designed to track the value of a reference asset such as the U.S. dollar — a profile that has made them a common pitch for cross-border conversions where banks cannot supply dollars quickly.

According to Shah, his existing relationship with Nesbitt was central to his decision to proceed. The Bidco founder told the court that he had known Nesbitt through business and private-sector organisations and trusted him because of his previous senior role and reputation.

Shah also testified that he contacted Standard Chartered to verify whether Nesbitt and BNB Kenya Limited, the entity involved in the transaction, held an account with the bank. A bank employee confirmed that the account existed but did not provide further information, he said. As described in the testimony, that check confirmed the account's existence, not the counterparty's ability to deliver the currency it promised.

Bidco transferred KES 102.4 million to BNB Kenya on May 23, 2023, under a trade-finance support agreement signed by Shah and Boitoru. The promised delivery of U.S. dollars did not materialise.

Nesbitt has been charged with conspiracy to defraud Shah and has denied the allegations. The case remains before the Kenyan courts, where further proceedings are expected to add detail on how the proposed stablecoin-based conversion was meant to work.

The testimony illustrates the risks businesses can face when foreign-exchange shortages lead them to seek alternative settlement mechanisms, including cryptocurrency and stablecoins. Those risks can increase when transactions depend heavily on personal relationships and assurances from third parties.

The case also highlights how cryptocurrency- and stablecoin-based currency conversion was presented to Kenyan businesses during the country’s dollar shortage in 2023, as well as the fraud risks that emerged in connection with such arrangements.

Source: BitcoinKE