Anti-graft detectives have uncovered suspected theft of more than Sh316 million involving four government ministries, including the National Treasury and the Office of the President.
The Assets Recovery Agency says the alleged fraud was executed by government insiders who used two individuals and their seven businesses to conceal the ultimate beneficiary.
Documents filed in court and exclusively obtained by the Star show how money was deposited into the seven bank accounts and quickly withdrawn in cash. The agency believes the move was to disguise the money trail.
Other than the Treasury and Office of the President, the suspected fraudulent payouts were also made by the Ministry of Interior, the Ministry of Defence, State Department for Public Service and the Ministry of Health.
“That the suspected bank accounts of the business entities received multiple payments from the same government ministries and state agencies in massive schemes of money laundering and fraud in an effort to conceal, disguise the nature, sources, disposition and movement of the illicit funds and should be preserved,” ARA argues.
At the centre of the probe are Ruth Nyambura James who is the sole proprietor of five businesses and Stephen Musyoka Kinyamaso who runs two entities.
ARA has secured court orders from the High Court temporarily freezing more than Sh91 million in the accounts of the two individuals.
Nyambura had Sh58.6 million in her five business accounts at Equity Bank while Musyoka had Sh31.8 million also at Equity.
“I hereby grant temporary preservation orders against all the respondents, their agents, employees, servants or any person acting on their behalf from transacting, withdrawing, transferring and dealing in any manner in respects of the funds specified in the named bank accounts,” Justice James Wakiaga ruled on Friday last week.
The alleged fraud was perpetrated over nearly five years from December 2014 to July 2020 when the agency moved in.
“Preliminary investigations established that Ruth Nyambura James and Stephen Musyoka Kinyamaso business entities received multiple payments from the same government ministries and state agencies in schemes of money laundering amounting to Sh316.5 million which would then be withdrawn in cash in split transactions in an effort to conceal or disguise the nature, source, location, disposition or movements of the said funds,” the agency said.
For instance, on 22 October 2018, one of Nyambura’s businesses, Butah Technologies received Sh9.9 million from the State Department of Immigration.
However, the bulk of the money was soon withdrawn in cash from Equity Bank Taj Mall Branch in three different transactions.
Two days after the cash hit the account, Nyambura withdrew Sh6 million. She withdrew another Sh2 million three days later and a further Sh900,000 after about two weeks.
Apart from Butah Technologies, Nyambura’s other firms include Jaruh Supplies, Butah Technologies, Caillytech Solutions, Sinatab Agencies, Five Zone Traders all with bank accounts at Equity Bank.
Musyoka’s firms are Steko Enterprises and Famotech Supplies.
ARA suggests that Nyambura and Musyoka could be known to each other as they have had direct bank transfers. For instance, on October 18, 2019, Sh600,000 was directly wired from Nyambura’s Jaruh account to Musyoka’s Stekno Enterprises.
An analysis of the bank statements of Jaruh Supplies alone shows that it has received Sh77.2 million from government agencies soon after the account was opened in December 2014.
The documents show that the Ministry of Defence paid Jaruh Supplies in 42 tranches totalling Sh14 million, the presidency paid it in 10 transactions worth Sh5.1 million while the National Treasury made two transactions adding up to Sh2 million.
In July, The Ethics and Anti-Corruption Commission obtained a court order to freeze four bank accounts of the National Treasury’s deputy director external resources Charles Muia Mutiso over unexplained wealth.
The frozen accounts at Absa, Kenya Commercial Bank and Cooperative Bank have more than Sh36.7 million. The details emerged amid national outrage over the alleged Kemsa scandal in which individuals, some too close to power, were awarded lucrative contracts.