EACC recovers Sh67 million fraudulently paid as irregular allowances to Treasury official
Court found that the official had illegally and irregularly received public funds disguised as taskforce, extraneous, entertainment, facilitation, and other unspecified allowances.
The Ethics and Anti-Corruption Commission (EACC) on Tuesday secured a landmark judgment resulting in the recovery of over Sh67 million that was fraudulently paid as unauthorised allowances to Faith Jematia Kiptis, an official at the Department of National Treasury and Planning.
In a judgment delivered by Justice Musyoki of the Anti-Corruption and Economic Crimes Division of the High Court in Nairobi, the court found that the official had illegally and irregularly received public funds disguised as taskforce, extraneous, entertainment, facilitation, and other unspecified allowances.
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As a result, the court ordered that she refund a total of Sh67,664,975, with Sh2,443,667.92 forfeited from her Equity Bank account and Sh6,320,419.80 from her KCB Bank account. Further, the court ordered Payment of interest at court rates until full recovery and costs of the suit be borne by her.
The judgment follows investigations by the Commission, which were initiated upon receipt of reports alleging embezzlement of public funds by Kiptis.
"EACC investigations established that between January 2020 and June 2022, Faith Jematia Kiptis received allowances contrary to government policy. These included multiple and overlapping committee and taskforce payments; payments made without the requisite approval from the Salaries and Remuneration Commission (SRC); allowances not applicable to her job group; and payments not provided for in government procedure manuals and circulars. The investigations also uncovered the disbursement of undefined and duplicated allowances that were neither recognised nor specified in any formal guidelines," the court heard.
Upon conclusion of the investigations, the Commission filed a plaint dated January 18 2023.
During the trial, the Commission presented evidence demonstrating that the allowances were unauthorised and in direct violation of the Salaries and Remuneration Commission (SRC)'s circulars, particularly the binding advisory dated December 16, 2015, and a subsequent circular issued on April 22, 2021, both of which expressly rejected the payment of such allowances.
The court reaffirmed that SRC's advice on public officers' remuneration is binding under Article 230 of the Constitution and held that Ms. Kiptis knowingly participated in the fraudulent scheme, unjustly enriching herself at the expense of the public.
It further noted that the National Treasury ought to have awaited the advice of the SRC before effecting any such payments.
"This judgment underscores the Commission's mandate to recover assets acquired through corruption and to uphold the integrity of public financial management and the protection of public property in Kenya. This judgment is one of several successful recoveries by the Commission involving funds embezzled from the National Treasury between February 2020 and June 2022," the commission said in a statement after the ruling.
Following the ruling, the Commission has recovered a total of Sh174,092,175 in unlawfully and irregularly paid allowances to officials of the National Treasury, through both Alternative Dispute Resolution (ADR) mechanisms and court processes.
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