A non-executive director of a construction company accused of fraudulently receiving over Sh96 million from Fina Bank Limited (FBL) — now Guaranty Trust Bank Kenya — broke down before Milimani Chief Magistrate Francis Andayi while defending herself.
Ms Gladys Moraa of Malch Construction Company Limited told Mr Andayi that for the last 11 years, she has suffered economically and emotionally for an offence she neither committed nor benefited from.
She disclosed the fraud was hatched by her brother, Mr Don Bosco Gichana, and a former Fina Bank Limited manager, Mr Graham Sagwe, who has also been charged.
Ms Moraa told Mr Andayi the beneficiaries of the fraud returned the money, leaving a balance of Sh15 million upon the intervention of High Court Judge Mohammed Warsame before whom the case was placed for criminal review.
The review had been sought by lawyer Macharia Njeru, now a member of the Judicial Service Commission (JSC).
Sh58 million intercepted
When the fraud was detected by the Banking Fraud Unit of the Central Bank of Kenya, Ms Moraa said Sh58 million was intercepted and returned to the lender. She listed beneficiaries whom Malch had disbursed the money to.
They were compelled by Justice Warsame to return the money and the charges filed against them were dropped.
Ms Moraa, who is charged alongside Mr Gwaru, Mr Sagwe and Mr Robert Moseti with conspiracy to commit a fraud and theft of Sh96 million from Eco Bank Limited, the property of Fina Bank Limited, said a city lawyer, Ian Maina, returned Sh33 million.
Another lawyer, Mr Albert Kuloba, returned Sh520,000, she said.
She added that her co-accused, Mr Moseti, returned Sh9 million which had been deposited in his account at the Barclays Bank of Kenya (now Absa).
Another Sh8 million paid to Ad Dot Company was also returned.
She added that her brother Gichana returned Sh12 million, leaving a balance of Sh15 million which Malch was supposed to clear.
Out of this balance of Sh15 million, Ms Moraa said Mr Sagwe is supposed to refund Sh10 million.
Brother gave instructions
She said her brother, who is the owner of the company, gave instructions how she and Mr Gwaru were to disburse the money.
“Your honour, as a non-executive director, I used to sign a whole cheque book but how monies were paid I don’t know,” Ms Moraa testified.
Led in her sworn defence by lawyers Ishmael Nyaribo and Danstan Omari, Ms Moraa said, “Malche has been willing and is still willing to return to FBL the balance of Sh15 million.”
She however said Malch encountered a problem with paying back the money following the arrest and jailing of Mr Gichana in Tanzania. He has since been freed.
Mr Andayi heard the conspiracy to defraud FBL was hatched by Mr Gichana and Mr Sagwe, who diverted the money meant for a Chinese company to Malch’s account in Eco Bank.
She said she has never operated an account in FBL.
“As you stand here today, can you tell this court whether you conspired with anybody to defraud FBL?”Mr Nyaribo asked Ms Moraa.
“No, I never and l have never conspired with anybody. It is my brother –Don Bosco Gichana — who called me a day before he and Mr Sagwe were charged telling me he has been arrested but he will handle it,” Ms Moraa replied.
Call from taxi driver
She further told the trial magistrate that she learnt about the fraud when a taxi operator called her telling her that her name had been splashed in the media over a Sh221 million bank fraud.
She testified that after purchasing a copy of the Daily Nation in November 2010, she locked herself in her bedroom where she read it in “utter disbelief”.
Ms Moraa said later, Mr Nyaribo called her and asked her to prepare herself as she was required to take a plea in court over the fraud.
She told the magistrate that she learnt from the investigating officer, Mr Fredrick Musyoki, that it was Mr Sagwe and her brother who hatched the plot to defraud the bank.
Ms Moraa pleaded with the court to acquit her, saying she never participated in the fraud conspiracy and has never engaged in crime since her childhood.
The accused asked the court to give her time to repay the money owed by Malch. The accused have since approached the DPP seeking to repay the money.
FBL confirmed to the court its willingness to accept the refund.
The deal will see them freed or get lesser punishment under a plea bargain scheme that will demand millions be returned to the bank, now owned by Nigerian lender Guaranty Trust Bank.
The Sh96 million was diverted from paying a Chinese contractor to a Kenyan firm associated with Don Bosco Gichana, Malch Construction, which had not handled any construction works, through Eco Bank.
Hearing resumes on October 29, 2021.