Court freezes accounts of roads authority director Margaret Muthui over Sh500m fraud

A director at Kenya Rural Roads Authority has been barred from accessing her bank accounts and selling properties worth millions of shillings she allegedly acquired using stolen public funds.

Margaret Muthui who is KeRRA’s Deputy Director for Supply Chain Management is said to have gone into a spending spree after allegedly embezzling public funds and bought 11 apartments in upmarket Kileleshwa Estate in Nairobi at Sh264 million in cash within a period of three months.

The 11 apartments are part of the properties and Sh13.9 million in her account frozen by Justice James Wakiaga following an application by Asset Recovery Agency claiming that Muthui and her associates had allegedly embezzled more than Sh500 million from the government.

“An order is hereby issued stopping the respondents or their agents from transferring or dealing with the funds in the stated accounts or disposing of the listed properties pending determination of the suit,” ruled Wakiaga.

ARA named Muthui, Esther Wagio Njunge, Grace Nyabura Ndiritu, Mercy Nyambura, Cynthia Nyambura and their company Light House Trading Ltd as beneficiaries of the alleged stolen public funds.

Justice Wakiaga also froze the accounts of Ms Njunge with Sh75 million and another Sh4.8 million in the accounts of Light House Trading Ltd.

Apart from the 11 apartments in Kileleshwa, the judge also stopped the four from selling or transferring a house at Nairobi’s Colligham Gardens, two plots in Kiambaa within Kiambu County, a piece of land in Dagoreti and 24 residential apartments in Ruaka.

Justice Wakiaga ordered Muthui and her associates to surrender the original land titles and leases for the properties to ARA as well as transfer the money in their accounts to the agency pending determination of the suit.

ARA in its suit filed through state counsel Esther Muchiri argued that the investigations revealed the properties were acquired through a scheme of money laundering with suspicion that the funds were diverted from government coffers.

“Their accounts received huge chunks of money which they could not explain and made us believe they are proceeds of crime and money laundering. They used to fund to purchase the apartments from Ceytun East Africa Ltd then registered them in the names of their proxies,” said Muchiri.

ARA investigator Fredrick Muriuki in his affidavit stated that Ms Njunge received suspicious amounts in her fixed deposit account at Cooperative Bank between June 2015 and October 2016 which has accumulated to Sh75 million.

For Muthui, the agency claimed that she deposited the Sh13.9 million in her fixed account and used the other amounts to purchase the apartments to conceal the source of his funds.

“She purchased the houses and registered them in the names of Grace Nyabura Ndiritu, Mercy Nyambura, Cynthia Nyambura at a cost of between Sh20.5 million to Sh27 million each. She has now rented the houses and charging Sh116,000 per month,” swore Muriuki.

He added that Muthui and her associates purchased the land in Kiambaa at a price of Sh15 million and the Dagoreti plot at Sh25 million.

According to the investigator, Muthui was the architect of embezzling the public funds but used her cronies to register the properties to conceal the theft.