Inside the deal that got DP Rigathi Gachagua back his Sh200m
Deputy President Rigathi Gachagua had the last laugh in his battle with the State when his Sh202 million that had been declared proceeds of crime was returned to him.
The State will also pay him the legal costs he incurred while litigating the case for almost two years at the High Court.
Court of Appeal judges Daniel Musinga, Imaana Laibuta and Grace Ngenye adopted the consent between the DP and the Asset Recovery Agency (ARA) as an order of the court.
This comes less than seven months after the High Court ordered that he forfeits his millions to the State for being proceeds of corruption.
The consent was signed by lawyer Kioko Kilukumi for Gachagua, Mohamed Adow for ARA and the law firms of Waruiru, Karuku & Mwangale Advocates and Prof Tom Ojienda & Associates for the other respondents.
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“The court adopts the consent in terms of the agreement reached by the parties and signed on January 19 which will be marked as an order of the court,” ruled the judges.
The agreement marked the end of Gachagua’s tribulations in the corridors of justice, and comes just two months after the Director of Public Prosecutions withdrew corruption charges he was facing over allegations of fraudulently acquiring Sh7.3 billion.
They also agreed that the forfeiture order by the judge be overturned and that Gachagua’s money which had been frozen in three accounts at Rafiki Microfinance Bank be released to him forthwith.
“The Asset Recover Agency is also to pay Gachagua, Jenne Enterprises Ltd and Rafiki Microfinance Bank the costs they incurred while litigating the case at the High Court,” read the consent.
The parties will agree on the costs but incase they are unable to agree, the registrar will assess.
The consent was signed following a series of negotiations between Gachagua and ARA, after the state agency changed tune told the Court of Appeal that Gachagua’s millions were not proceeds of corruption and that they misled the High Court in issuing the forfeiture orders.
Lady Justice Maina on July 28 last year ordered Gachagua and his business associate to surrender the funds to the government after finding that they were proceeds of crime acquired through corruption.
According to the judge, ARA which filed the suit had proved beyond any reasonable doubt that the DP and his associate engaged in corrupt practices and acquired the millions which they could not explain.
But the DP, through Senior Counsel Kioko Kilukumi, appealed against the judgment, arguing that he was not given a fair hearing.
The State agency in a strange twist filed an affidavit through the investigating officer Fredrick Musyoki on December 30 stating that they are not opposed to the money being given back to the DP.
ARA argued that they had obtained new evidence that satisfactorily explains the source and legitimacy of the funds, and that they were misled by the Director of Criminal Investigations to believe the money were proceeds of graft.
“Since the DCI had purportedly investigated the matter, we relied on their conclusion that the funds were proceeds of crime and it was on that assumption that we filed the suit to have the money forfeited to the government,” swore Musyoki.
Musyoki swore that they wrote to six state agencies which the DP had traded with and acquired the funds on November 14 2022 to confirm if indeed they paid for services and goods delivered.
Among the State agencies they inquired from were Kenya Tsetse and Trypanosomiasis Eradication Council (KENTTEC), state department for Asal and regional development, Kenya Power and Lighting Company, state department for Lands and the county government of Bungoma.
He said that KENTTEC through its chief executive officer confirmed that they have never had any complaints regarding the contract with Gachagua’s company and that the money paid was duly authorised and signed.
From the State Department for Asal and Regional Development, ARA said they received confirmation that the DP was paid Sh32 million after his company satisfactorily completed construction of Primary Sewer and Electro-Mechanical Works with no arising complaints.
Musyoki swore that KPLC also confirmed to them that the Sh10 million paid to Gachagua’s company Wamunyoro Investment Limited was for gravelling of Nairobi West Office Yard with no complaints or defaults raised.
“We also received confirmation from the Ministry of Lands that the Sh65 million paid to the appellant and his companies were for supply of flatbed scanners which were delivered as per the contract with no complaints,” swore Musyoki.
He added that the County Government of Bungoma confirmed that they paid Gachagua’s company Encarter Diagnostic Limited Sh35 million for services performed which was value for money with no complaints of corruption.
With the new revelation, the DP through his lawyer Kioko Kilukumi wrote to ARA on January 9 asking that they settle the dispute out of court given that the independent investigations had established the proceeds were legitimate earnings.
“Our instructions are that the recovery proceedings were politically instigated and more significantly, the agency has confirmed from the procuring entities that indeed goods and services were rendered and there was no complaint whatsoever,” said Kilukumi.
Kilukumi insisted that the DP was mistreated by the High Court when the judge refused to allow him to cross examine the investigating officer before the court went ahead to consider irrelevant issues in determining that the money was acquired through corruption.
He had asked ARA to concede to an amicable settlement to avoid wasting the Court of Appeal’s time based on the new revelation by the investigator.
ARA through lawyer Mohamed Adow allowed the request and on January 10 informed the Senior Counsel to draft the terms of the consent which all the parties signed on January 20.