For John Koyi Waluke, June 25,2020, will forever remain memorable but for all the bad reasons. He was found guilty of a Sh314 million maize import fraud.
Prior to the fraud case that resulted in his conviction this week, Mr Waluke was largely known for his political battles especially in Bungoma where he desperately sought election to Parliament for many years.
He had made several attempts to win the Sirisia parliamentary seat but unseating then Cabinet minister Moses Wetang’ula was not that easy.
The former military man almost clinched the seat in the 2007 general election. Actually, he thought he had won only for the coveted seat to be “snatched” from him. Mr Waluke subsequently filed an election petition but it was dismissed and he was made to wait for his rival to complete his term.
His quest was successful in 2013, winning the Sirisia constituency seat on an ODM ticket, then the popular party in Bungoma and the larger Western Kenya. He defended the seat in 2017 but this time on a Jubilee ticket against ODM, ANC and Ford-Kenya wave in the region.
During his stint in Parliament, the MP was elected the vice- chairman of the Administration and National Security committee.
All was well for the second term MP until October, 2018, when he together with a co-director of Erad Supplies & General Contractors were charged with corruptly acquiring Sh314 million from the National Cereals and Produce Board (NCPB).
This was after Parliament Investment Committee (PIC) probed the saga and found that they had corruptly been paid by NCPB yet they had not even supplied a single grain to the agency in 2004.
Evidence in court was that his company won a tender in August 2004 to supply 40,000 metric tonnes of maize.
But NCPB failed to give the company letter of credit to facilitate the importation of the maize. And for frustrating the contract, the company filed a case before an arbitrator and were awarded more than Sh500 million.
He together with his co-director claimed they imported the maize, which was meant for the strategic grain reserve from Ethiopia. Before arriving in Ethiopia, they claimed the maize had been stored in South Africa, making them incur more losses.
In the tender, five firms won the contract to supply some 180,000 metric tonnes of maize. But out of the five, four were issued with the letters of credit. Erad’s letter of credit was not opened. Eventually, only two firms supplied the maize, which was meant for drought mitigation.
After filing the case before an arbitrator, the firm was awarded damages for loss of profit, cost of storage and interests.
Evidence tendered in court showed that the company was incorporated in 1998 to deal in cement, sand and cereals. It also dealt in sugar, maize and beans, among other commodities.
On Monday, Mr Waluke together with 79-year-old co-director Wakhungu were found guilty of five counts, among them fraudulently receiving money from NCPB. The court found that the documents they used to convince the arbitrator that NCPB was wrong, were forgeries.
He becomes the first MP to be convicted under the watch of Director of Public Prosecutions (DPP) Noordin Haji.
While defending himself, the MP said a former shareholder, Jacob Juma, was the man who ran the show because he was more aggressive, and that it was only he who knew about the documents he presented to the arbitrator and only he who could tell if they were forgeries.
The MP admitted that he was paid Sh50 million from the award while Ms Wakhungu got Sh40 million. Mr Juma, he said, kept the rest while some were paid to law firms that represented the firm in the arbitration.
He said there was nothing criminal in the case, and if anything, the matter was still pending before the Court of Appeal, as they were pursuing a further Sh400 million from the agency.
But Chief Magistrate Elizabeth Juma observed that the letter of credit was a crucial document that was vital to initiating the importation process.
She said the company had no capacity to commence the process but the firm jumped the gun and went ahead and secured the maize on August 4, 2004, a day before the tender was awarded, imported the commodity and stored it without the letter of credit
Evidence presented to court showed that Ms Wakhungu owned some 1,000 shares in the company while Mr Waluke and Juma owned 500 shares each.
Later, in March 2006, Juma resigned and Waluke increased his shares by 250 while the rest went to Ms Wakhungu.
His defence was dismissed by the court saying as co-directors, they were responsible for the utilisation of the money, otherwise they ought to have protested or instructed their lawyers to distribute the money as they deemed fit.
This is because they were not answerable to a former director Mr Juma, whom they accused of meddling in the affairs of the company.