Graft cases hanging around Gachagua’s neck

Mathira Member of Parliament Rigathi Gachagua, who Deputy President William Ruto announced as his running mate yesterday is fighting allegations of fraud in court involving billions of shillings allegedly fleeced from public coffers.

The fiery politician has been on record dismissing the allegations as a far-fetched political witch-hunt despite having been charged in court and active court cases going on in the corridors of justice.

The MP is defending himself in court against allegations of fraudulent purchase of public property and money laundering totalling Sh7.3 billion through three Rafiki Micro-Finance Bank accounts.

Rafiki Microfinance Bank Limited asked the court to enjoin it in the case so it can argue its case in defence of Gachagua and his business associate Anne Kimemia trading as Jenne Enterprises Ltd.

Through lawyer Henry Macharia, the bank says it stands to lose Sh170 million should the court allow the application by Asset Recovery Agency (ARA) to have the money in Gachagua’s account forfeited to the state and wants to be enjoined in the case as interested party.

“The bank has been holding the money as security for various credit facilities advanced to third parties, who have already defaulted in repayment, which means the bank will suffer irreparable losses should the forfeiture orders be issued,” the bank said.

A complicated network of financial transactions involving the MP’s family, including his wife, children, nephews, nieces and close colleagues, comprising politicians and a banker, was disclosed in an inquiry report. The plot directly benefited the wife, who is a co-director in some of the companies.

Sammy Kipkorir, a Mathira CDF employee who was the only signatory of Upper deck Agencies and allegedly made cash withdrawals from the MP’s Rafiki DTM account, was one of the MP’s close companions.

The role of Gachagua’s favourite banker, Ann Nduta Ruo, at the Rafiki DTM was also revealed in the court files. Details are lacking Upper deck Agencies’ account opening materials were incomplete, with one of the forms missing elements such as pictures.

Justice Joseph Onyiego froze almost Sh200 million belonging to the MP in October 2020, providing a unique glimpse into his financial war chest and cash dealings from his three accounts in the microlender not known for huge transactions.

After receiving Sh5.8 billion, one savings account had a balance of Sh773,228 while a fixed deposit account had Sh35 million after getting Sh877 million.

According to the Assets Recovery Agency ARA’s court records, a second fixed account received Sh5.87 billion, of which Sh705.1 million had been withdrawn, but with a Sh165 million balance, leaving an unexplained Sh5.1 billion.

Criminal proceeds the ARA said it received information from the Ministry of Lands (Kenya Informal Settlements programme), the state department for Special Planning, the Ministry of Health, Bungoma county government, Mathira constituency development funds, Nyeri county government, and the National Irrigation Board on March 30, last year, about suspected complex money laundering schemes and proceeds of crime involving public funds.

According to early investigations, Gachagua and Jenne Enterprises Limited were involved in a suspected complicated money laundering conspiracy involving multiple entities that received monies from government departments and state agencies.

The Informer had established that most of the monies in question were traced back to at least four counties; Nyeri, Kisii, and Kwale counties, Mathira National Government-CDF, Tana Athi River Development Authority (TARDA), Ministry of Housing and Urban Development and the State Department of Environment.

Detectives unearthed a trail of cases where loans were purportedly acquired to cover up for funds received from government entities.

“However, these loans have been used to cover-up for funds received from government departments or inter-company transfers in a bid to conceal the ultimate beneficiaries of funds.” A preliminary investigation report says in part.

According to detectives, it was difficult to ascertain whether the companies made any supplies to some counties as the bank accounts made minimal or no payments to suppliers, which is normal for any transaction.

The detectives also raised the possibility of the lawmaker using kick-backs or payments to influence the award of lucrative tenders in counties, particularly in Nyeri.

One of the companies of interest is Asoma Enterprises, which is owned by a salonist, Julia Muthoni Mwangi, who was an employee of Gachagua at his Ellison Hair dressing based at the Anniversary Towers in Nairobi.

Muthoni also opened a cleaning company, Klinshine Limited, which used to clean Gachagua’s office.

Asoma Enterprises won several tenders in Nyeri county government including upgrading Thungari dispensary bridge road, upgrading of Karafani-Gatome road, and installation of culverts at Charity-Manooro Road, among many others.