Detectives say they have finalised investigations into tenders involving companies associated with Mathira MP Rigathi Gachagua, putting the legislator in trouble over Sh12 billion said to have passed through his accounts.
The number of companies associated with the MP’s transactions, and those of his proxies, have now reached 40, revealing what seems to be a complex web of transfers.
Most of the transfers end up in a company known as Wamunyoro Investments Limited, where Mr Gachagua and his wife, pastor Dorcas Wanjiku, are the only shareholders.
“We have completed that investigation and it has taken us a lot of time,” said Director of Criminal Investigations George Kinoti, without revealing his next move.
Eight months ago, detectives from the Serious Fraud Unit of the Directorate of Criminal Investigations questioned the MP over alleged corruption and money laundering and later released him without charges.
In their final report, detectives say Mr Gachagua used his companies and proxies to fraudulently procure multibillion-shilling health tenders in the counties and the national government.
For instance, while a company known as Upperdeck Agencies won a Sh9.4 million tender to supply linen to Nyeri County hospitals, its proprietors were listed, in the bank records, as Gerald Waema Mbatha and Moses Otieno.
Detectives later found out that when the money was paid on February 18, 2015, the entire amount was transferred to Wamunyoro Investments Limited, leaving a balance of Sh5 only.
Proxies companies
They also found out that the listed proprietors were not signatories to the bank account.
The sole signatory was a Mr Sammy Cheborgey, an employee of Mathira National Government Constituency Development Fund (NG-CDF) committee. But Kenya Revenue Authority documents indicate Mr Gachagua is linked to the company.
The entire scheme appears to have started when Mr Gachagua’s elder brother, James Nderitu, who died in 2017, was the governor of Nyeri County.
The family appears to have used some of the companies – through proxies – to carry out business with the county.
“Accounts held at Rafiki Deposit-taking Microfinance have been used to source for loans (and) these loans have been used to cover up for funds received from government departments or intercompany transfers in a bid to conceal the ultimate beneficiary or beneficiaries of the funds,” the final investigation report says.
For instance, Crystal Kenya Limited, which had an account at Rafiki DTM, transferred some money to the late governor and the money was used to buy some plots in Nyali, Mombasa.
Another of Mr Gachagua’s companies, Rapid Medical Supplies, was being investigated over Sh47 million medical supplies to Nyeri County.
After analysing the bank accounts of some of these companies, the detectives say “the bank statements were noted to made minimal or no payments whatever to ‘would-be’ suppliers, yet they receive large amounts for supplies (and) works done. This is likely to imply that no supplies are made or works done,” the report says.
Apart from the DCI, the Asset Recovery Agency (Ara) has taken Mr Gachagua to court where they are questioning his billionaire status and the source of money found in his various accounts.
But while Ara had targeted to freeze the accounts, the agency told the court Mr Gachagua managed to withdraw Sh7.3 billion, which he disbursed to various companies and bought some assets. The agency said it could only locate Sh5.2 billion, according to court records.
Links with DP Ruto
Mr Gachagua, however, read politics and dismissed his previous arrests and investigations as “persecution” over his alliance with Deputy President William Ruto.
In past public pronouncements, the legislator claimed he was being targeted because of the “poor turnout” when President Uhuru Kenyatta visited Mathira.
After he was questioned by the DCI, Mr Gachagua sought the protection of the High Court.
In a signed affidavit, he said: “I have a genuine fear that I will soon be arrested and charged with offences I do not know about. My impending false arrest is based on my political standing. It will be malicious and devoid of merit to arrest me without any evidence linking me to any crime,” swore Mr Gachagua.
Yesterday, Mr Gachagua said he is “aware” that he is set to be arrested.
“They want to get me out of Kiambaa by-elections where Jubilee is facing an uphill task and where I was a DO (District Officer) for many years. I also know that I will soon be facing trumped-up charges but I am ready for them. If they want to arrest me, they know my home, and they know my office. I am ready. But the good thing is that the courts are independent and will bring his monkey-business to an end.”
Besides Mr Gachagua, the investigators have recorded statements from 102 people, include Meru Senator Mithika Linturi, former Cabinet Secretary Mwangi Kiunjuri and Laikipia Senator John Kinyua. Bank records have indicated they received some payments from some of the companies.
The investigators were concerned that some of the companies had some youths as proprietors but upon receiving the payments for tenders reserved for the youth, the funds were wired to Gachagua’s companies.
“During the recording of the statements, they appeared clueless, naïve, unprofessional and (as) persons who had no idea what their companies had done,” a preliminary inquiry report had noted.
“The tenders won involved construction of roads, water pans and others but they did not have any idea how it is done. They had no known office space, staff and both were operating from Gachagua’s office.”
Road construction tenders
The final document states that “there have been attempts to conceal” the beneficiaries of the accounts, with some entities paying money into a clearing account at Rafiki DTM, from where it was moved to respective beneficiary accounts.
“The funds received through the suspense/clearing account were ultimately utilised by immediate transfers to Wamunyoro Investments, transfers to Rigathi and to Julienda Jahenda Makaa, personal secretary to Rigathi,” the dossier points out.
According to detectives, Ms Makaa was an M-Pesa attendant in Buruburu before she became a hairdresser in a salon operated by the Gachagua family.
Ms Makaa is the proprietor of Skytop Agencies, which received tenders valued at millions of shillings from Mathira CDF.
Detectives are pursuing leads as to why some companies that won road construction tenders in Nyeri County paid part of their proceeds to either Mr Gachagua’s companies or his proxies.
For instance, Stecol Corporation, which has won tenders in the county, paid Sh15 million to Skytop Agencies, while Endrem Agencies paid Sh34 million to Machine Centre Limited.
Machine Centre Limited is associated with William Wahome – the board chairman of Mathira NG-CDF – and Elizabeth Wachera. Both Machine Centre Limited and Gachagua’s Wamunyoro have two Joint Venture savings accounts in Equity Bank.
“Further, Machine Centre Limited received a total of Sh314 million from the Ministry of Water and Sanitation for Sagana River Restoration Project. This contract was awarded to Baran International, an Israeli company and it is not clear how the payment, which is 20 per cent of the project cost, was made to Machine Centre Limited,” documents indicate.
While analysing the bank documents relating to Machine Centre Limited, detectives found out that a majority of the withdrawals or transfers were “in a structured manner to beat the reporting threshold of Sh1 million”.
In total, police have been looking at 66 bank accounts, include 10 belonging to the MP. But in a previous interview with the Nation, Mr Gachagua said the cases “will be determined on merit, not by directives of some dynastic sympathisers who are hell-bent on curtailing our democratic choices and attached liberties to speech and association”. BY DAILY NATION