Kenya: Woman Accused of Conning Mt Kenya Coffee Societies Millions

26 October 2021

A woman claiming to be a representative of the International Coffee Organization (ICO) has been accused of duping coffee society officials in the Mt Kenya region to sign multi million-shilling contracts for rebuilding factories, exposing them to litigation.

Officials of 27 societies in Tharaka-Nithi complained that Ms Caroline Karanja might have deceived them into signing illegal contracts.

In Meru County, contractors who had started work on four factories have abandoned the projects, saying they have not been paid.

At least 50 factories were expected to be refurbished in Meru alone, each for over Sh20 million, according to the Meru Central Coffee Union.

Similar tenders had been issued in Machakos and Bungoma counties but work had not started when the alert was raised in Tharaka Nithi.

The ICO is an intergovernmental organisation for coffee that brings together exporters and importers to tackle the challenges facing the sector in the world through international cooperation.

Ms Karanja was arrested on October 15 by officers from the Directorate of Criminal Investigations in Chuka, accused of impersonating an official of the ICO.

Bills of Quantities

She was presented in court last Monday with police given 10 days to complete their investigations.

But even as investigations started, society officials who spoke to Nation said they suspected the deals might have been fake when they were presented with Bills of Quantities and asked to sign contracts.

"We were asked to open new bank accounts, which we did, and she asked us to sign the contracts. But we were shocked because though the contractors had started work, no money was being wired into our accounts," said an official in Meru, who spoke on condition of anonymity.

Another contractor said Ms Karanja would present them with seemingly lucrative bills of quantities of over Sh30 million, with construction costs of Sh15 million, and ask them to pay facilitation fee.

"Any businessman wants good profits and with such good money, it was easy to part with up to Sh1 million," said a contractor, adding, at least 30 of them had paid the "fees".

He said he had spent Sh3 million refurbishing a factory in Imenti North, Meru, and vowed to ensure he was paid his money.

"I signed a contract with the society and in case I'm not paid, I'll sue the society because it's the one on the papers," he said.

Meru Coffee Millers Cooperative Union was also supposed to be refurbished for over Sh70 million but officials said the project didn't start.

"We suspected the project was fake because when we demanded to sign the contract with the financier, the coordinator refused," an official at the society said.

Meru County Trade, Tourism and Cooperatives Executive Maingi Mugambi said the devolved unit was not aware of the works. "We were not consulted and we don't know what's going on," he said.

When Ms Karanja was presented in a Chuka magistrate court on October 18, prosecutors argued that detectives had several people of interest to interrogate before bringing charges against the suspect.

Unhappy with the ruling, Ms Karanja, with the help of her lawyer Muthomi Gitari, moved to the High Court on the same day.

Under a certificate of urgency, the matter was heard before Chuka High Court Judge Lucy Gitari.

Bail or bond

The lawyer argued that it was unfair to detain his client without the option of bail or bond for an offence that had not been disclosed to her.

In her ruling, Justice Gitari upheld the decision of the magistrate's court, noting the suspect could interfere with investigations.

"The suspect will remain in police custody for the 10 days as investigations are concluded and on expiry of the time, she must be either charged or set free," Justice Gitari ruled.

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