Cost of graft: Convicts reel under hefty court fines

It is almost three weeks since Sirisia MP and his accomplice Grace Sarapy Wakhungu were ordered to pay Sh2.06 billion in fines or serve 60 plus years in prison, for stealing Sh313 million from a State agency.

The two are yet to raise the amount and efforts by Mr Waluke’s wife to come up with a paybill number, seeking assistance from well-wishers failed almost immediately.

There were claims that the family of Ms Wakhungu was planning to raise the amount, but they too are yet to secure her release highlighting the high cost that corruptions suspects face upon conviction.

Slapping of the duo with the hefty fines sent shockwaves across the country and agencies involved in administration of justice are hoping to capitalise on the duo’s judgement to deliver more wins in the fight against corruption.

They argue the law is clear on the cost of graft and the guilty will get what’s coming their way as the Judiciary speeds up hearing of cases.

Section 48 (2)(b) of the Anti-Corruption and Economic Crimes Act (ACECA) imposes a mandatory fine, which is twice the amount the convicted persons benefited from.

It reads: “If the conduct that constituted the offence resulted in both a benefit and loss described in subsection (1)(b), the mandatory fine shall be equal to two times the sum of the amount of the benefit and the amount of the loss.”

Speaking to the Business Daily, Director of Public Prosecutions (DPP) Noordin Haji said it will not be easy for persons convicted on corruption cases to secure their release. If they think their deep-pocketed friends will quickly come to their rescue, Mr Haji said they are mistaken.

“We are taking a step further of tracking down the source of funds they would want to use to settle their court fines. We will not entertain the corrupt bailing out their colleagues,” he said.

Mr Joseph Riungu, an assistant DPP said the Wakhungu-Waluke judgment and their sentencing demonstrate the seriousness of the fight against corruption.

“The Office of Director of Public Prosecutions (ODPP) shall not relent to passionately prosecute and see the same standards of fines and penalties are meted in anti-corruption cases that are ongoing,” he added.

So far, Ms Wakhungu has found life behind bars unbearable. She has pleaded with the High Court to be released on bond pending the hearing and determination of her appeal.

In an application filed through Senior Counsel Paul Muite, Ms Wakhungu said she is 79 years old, sickly and undergoing treatment for hypertension.

Mr Muite further said because of her age and her underlying sickness, there is a likelihood that she has not been in proper mental state and that she may have been unable to stand trial and understand the nature and consequences of the proceedings as contemplated.

During the trial, he added, Ms Wakhungu allegedly displayed traits such as difficulty in concentrating, anxiety, long-lasting sadness and other signs of inferior mental health.

Other than being released pending the hearing of the appeal, he wants the court to direct the officer in charge of Lang’ata Women’s prison to conduct “geriatric and psychiatrist tests, in the presence of her doctor”. And after examining her, the doctor should file a report on her physical and mental health.

He said if not assessed and released, her physical and mental health might deteriorate permanently. “Her continued imprisonment, notwithstanding her age, medical condition extra-ordinary circumstances of the case and overwhelming chances of success in the appeal is highly prejudicial to her let alone that it cannot be undone by any legal relief,” the application stated.

Ms Wakhungu was sentenced to jail for 69 years after the chief magistrate Elizabeth Juma found her guilty of five counts in connection to theft at National Cereals and produce Board (NCPB).

The elderly woman accused the court of shifting the burden of proof on her and imposing a harsh sentences.

The two and their firm, Erad Supplies & General Contractors, received millions of shillings from NCPB for fake claims, in an alleged botched deal to supply some 40,000 metric tonnes of white maize in 2004.

Mr Waluke admitted that he was paid Sh50 million from the award while Ms Wakhungu got Sh40 million. A former partner, Jacob Juma allegedly paid himself Sh113 million while the rest of the money went to law firms, which represented the firm in arbitration.

Before the NCPB case, a court delivered judgements in a Sh283 million cemetery land scam to years ago. Former Nairobi city council legal secretary Mary Ngethe was fined Sh52 million, and on failure to pay ruled she was to serve four years in jail.

Her co-accused Alexander Musee was ordered to pay a mandatory fine of Sh32 million for his role. He was a member of a county tender evaluation committee.

Ms Ngethe and Mr Musee were found guilty of giving a misleading report purporting that the committee had agreed to buy the controversial 120-acre land in Mavoko town, Machakos County. They also used a false valuation report to award the tender.

Also sent to jail over the scam was former Local government Permanent Secretary Sammy Kirui and ex-Nairobi Town Clerk John Gakuo, who died in prison waiting for the hearing of his appeal suit. The three remaining convicts were released months later after posting bond of Sh5 million each. Their appeals are pending.

While sentencing the officials, chief magistrate Douglas Ogoti said they acted passively and allowed embezzlement of public funds.

In yet another case, former Kenya Re-Insurance managing director Johnson Jackson Githaka is serving a two-year jail term for fraud.

Mr Githaka was given the option of paying a Sh15.1 million fine, which is twice the amount he fraudulently received after the sale of a building belonging to United Insurance Company. He used the money to purchase a house in Loresho.

The trial court found Mr Githaka guilty of corruptly receiving Sh7.2 million from the underwriter. The insurance company was placed under statutory management on July 15, 2005 by the Commissioner of Insurance Sammy Makove, who also picked Kenya Re insurance as the statutory manager.

On September 23, 2005, the statutory manager Mr Samuel Mueni invited bids from interested buyers for United Insurance Towers. The building situated on Westlands Museum Hill Road had served as the company headquarters.

It was eventually sold to PTA Reinsurance Company at a cost of Sh242 million. The buyer paid the initial deposit of Sh24.2 million through Muriu Mungai and Co. Advocates on December 23, 2005.

In January 2006, Mr Githaka, then the managing director wrote to Muriu Mungai and Co. Advocates instructing them to release a commission of 3 percent of the sale price to an agent who was not specified.

Public trust betrayed

Last year, Justice John Onyiego dismissed an appeal by Mr Githaka, saying he was properly convicted.

“Having held above, I am satisfied that the appellant did use his office improperly to confer a benefit unto himself thus betraying public trust entrusted on him. The conviction is upheld,” the judge ruled.

Another former official who was slapped with a hefty fine is John Faustin Kinyua, then Kenya Re-insurance finance director and Charles Gichane, former Heritage Insurance manager, who were ordered to pay a Sh7.3 million fined each , failure to which they would serve three years in jail for tricking taxpayers into buying a house at Embakasi’s Villa Franca Estate.

Evidence presented in court showed that they hatched and executed the scheme and the magistrate ordered each should pay Sh1 million for the fraudulent acquisition of public property, alongside a fine double the value of the house at the time of the crime.

But on appeal, the High Court reduced the fine slapped on Mr Kinyua and directed him to pay a fine of Sh393,792, saying it was the amount involved in the fraud.

In the judgment, Justice Mumbi Ngugi faulted chief magistrate Lawrence Mugambi for imposing a mandatory fine of Sh6.3 million and a further fine of Sh1 million for abuse of office.

Last year, two former senior employees of the Nairobi County government and a broker were fined a total of Sh29 million after they were found guilty of conning a Chinese contractor and denying the county Sh8.8 million.

Ms Esther Nyambura Thogori, a former city county clerical officer III, Mr Bonney Stephen Otieno Oduor, a building inspector and Mr George Gichui Karume, a broker were found guilty of fraud.

The three, on diverse dates between May 11, 2015 and December 16, 2015, conspired to commit an economic crime by retaining Sh8,891,943 building approval plan that was meant for the county.

They were also accused of jointly conspiring to defraud Li Wen Xue of Sh8,891,943 for building approvals.

Mr Li, the proprietor of Elephant Real Estate Ltd, complained about a delayed approval yet he had paid a fee of Sh8,981,943 to the county.

The investor said he later discovered, upon checking, that his approval requests had been made in favour of the property by different developers and architects.

He said the approval was for a joint venture, yet the project was to be executed solely by Elephant Real Estate.

His company was to develop a parcel in Kilimani, by putting up a 19 storey building. But he was later informed that the designs were never approved on the basis that only eight floors were permitted within the zone.