Guernsey-based Investec Trust has become embroiled in a UK Serious Fraud Office investigation into British links with one of the biggest corruption inquiries in Africa.

According to The Guardian, UK firms won huge contracts from the Kenyan governments of presidents Daniel arap Moi and Mwai Kibaki, but anti-corruption investigators have discovered that many were fictitious and amounted to state-sponsored looting.

The SFO inquiry is concentrating on the movement of millions of pounds into accounts in Guernsey and Jersey controlled by UK-based arms dealer Andrew MacGill.

Documents seen by the Guardian, it said, showed that financing for some of the 18 suspicious security equipment contracts at the heart of the investigation was administered through Investec Trust, based in Guernsey.

Three men are now the focus of the SFO investigation. The Investec documents show that Mr McGill and and his business partners, brothers Rashmi and Deepak Kamani, were involved in 13 of the suspect contracts, which had an overall total value of more than $700 million.

Investec Trust is an arm of Investec, the South African-based private bank. It handled Mr McGill’s corporate business from 2001 through accounts with the banks HSBC in Guernsey and Standard Chartered in Jersey. Internal audits are understood to show that no questions were asked by Investec managers about his firm's receipt of funds from Kenya or dealings with controversial arms suppliers.

It was only after the publication in March 2004 of a report by the former Kenyan anti-corruption chief, John Githongo, that executives realised the danger and the company's lawyers recommended the firm make a suspicious activity report to Guernsey's financial intelligence service.

Last week an Investec spokesman said: "We are aware of this matter and are satisfied that we have dealt with it appropriately."

The investigation comes shortly after Investec Trust was named institutional trust company team of the year by the Society of Trust and Estate Practitioners at its annual private client awards.

Peter Neville, director general of the Guernsey financial services commission, said: "We take very seriously any evidence that a licensed finance business has been involved, even unwittingly, in untoward activities."