MPs put Judiciary on the dock over stolen court fines

The Judiciary faces mounting pressure over its failure to recover hundreds of millions in stolen court fines, with lawmakers now ordering immediate action against implicated banks and individuals.

The Public Accounts Committee has exposed shocking details of financial mismanagement, revealing that about Sh160 million in court fines had gone missing as of June 2022, with some cases dragging unresolved for over a decade. 

The Butere MP Tindi Mwale-led committee has directed Judiciary Registrar Winfrida Mokaya to expedite recoveries, citing glaring negligence in financial controls.

"The committee noted that the Judiciary was negligent in controls and reconciliations resulting in avoidable loss of funds," PAC stated in a damning report now before Parliament.

The revelations paint a picture of systemic failures, with funds disappearing from court stations across the country while investigations move at a snail's pace. 

Among the most glaring cases is Sh34 million lost at Molo law courts, where no prosecutions have occurred despite the matter being reported to investigative agencies in January 2021.

“The committee recommends that the accounting officers follow up on investigations to ensure criminal prosecution is taken against those responsible for the loss,” the report reads.

Similarly, Sh48 million vanished from the Judiciary headquarters through staff theft, with the dismissed employees yet to face consequences.

The matter was referred to the Director of Criminal Investigation and the Asset Recovery Agency, and is still outstanding.

Judiciary officials explained that the loss at the headquarters related to a fraudulent cybercrime payment in the deposit account for the fiscal year 2013-14.

Bank statements revealed further losses — Sh2.7 million in Embu, Sh84 million in Nakuru, and Sh1.5 million in Malindi court stations— though the Judiciary disputes the Nakuru figure, maintaining only Sh52 million remains unaccounted for there. 

“The committee recommends that the accounting officer immediately initiates civil recovery proceedings against all responsible persons and banks,” MPs said.

The rot appears to be running deeper than just missing fines.

The Judiciary has failed to surrender Sh866 million in unclaimed court deposits to the Unclaimed Financial Assets Authority as required by law.

These funds, held at various court stations beyond the mandatory one-year period, represent another failure in financial stewardship that has drawn lawmakers' ire. 

Lawmakers hold that the most alarming is the pattern of inaction following the thefts.

In one case involving a fraudulent cybercrime payment from 2013-14, though suspects were convicted, Sh37 million remains unrecovered.

A bank implicated in the scam refunded only Sh10.4 million after the Judiciary demanded it in February 2021.

Despite repeated requests to the Attorney General, the latest in March 2023, no civil recovery proceedings have been initiated against responsible banks or individuals. 

“The Attorney General is yet to initiate civil recovery proceedings against the responsible banks and persons,” the Judiciary told MPs.

The Judiciary said its letters to the Attorney General, the latest in March 2023, to initiate the recoveries were yet to be acted upon.

It emerged that the loss at Molo law courts was filed with the Director of Criminal Investigations and the Asset Recovery Agency in January 2021.

The Judiciary also failed to prepare monthly bank reconciliation statements or submit quarterly deposit reports to the Auditor General, breaching legal requirements.

Auditor General Nancy Gathungu flagged these violations, noting the Judiciary's inability to confirm the recoverability of lost deposits as of June 2024. 

Meanwhile, a separate Sh352 million meant for the Judiciary but held by former district treasuries remains in limbo.

While PAC claims the National Treasury admitted liability, Gathungu's recent report contradicts this, stating that the Treasury has never acknowledged the debt. 

She said in the report released two months ago that the Treasury has not acknowledged the debt to date.

The auditor general noted that the amounts had not been recovered as of June 30, 2024. “The recoverability of the lost deposits could not be confirmed.”