The Ministry of Agriculture has heightened its investigations into the circumstances under which politically motivated Kenya Tea Development Agency (KTDA) officials borrowed a Sh18.2 billion loan to pay an early bonus to farmers ahead of last year’s general election in August.
On Tuesday, January 10, 2023, the besieged directors led by CEO Wilson Muthaura alongside Board Chairperson David Ichoho honoured summons to appear before an inquiry committee at Kilimo House.
The executives who were part of the previous Peter Munya-led puppet populist administration are faulted for acting against farmers’ best interests and taking the multi-billion loan in an attempt to swing votes in favour of Azimio presidential candidate Raila Odinga.
According to trusted insiders, the visibly shaken directors who could soon face prosecution arrived to answer the scathing allegations in a fiery grilling session that began at 7 am.
Records show that KTDA mortgaged its shares worth Sh18.2 billion to pay an early bonus to farmers ahead of the polls.
The loan was guaranteed by the KTDA Management Service, a subsidiary of KTDA Holdings.
Some of its directors include Wilson Muthaura, Dorcas Mugure Mwangi, Julius Misuko Onguso, Mathews Ouma Odero and Simeon Kiprotich Rugutt.
KTDA normally closes its books on June 30 with the bonus payment to farmers approved in September ahead of disbursement in October, but the 2021/2022 bonus was paid at the beginning of July.
The books had not been closed and audited by the time the company paid the bonus.
They borrowed the money from multiple banks that included NCBA and Standard Chartered Bank Kenya.
The disclosure on the debenture was recorded on September 2, 2022, by the registrar of companies after the company had paid the bonus.
The irregularly approved loan has subjected farmers to extra costs as they are paying interest on the borrowed amount through their respective factories.
For instance, farmers in Chinga tea factory in Nyeri had to pay close to Sh3 million in interest from the Sh200 million that they had received to pay an early bonus, according to the management.
Reacting to the heavily publicized reports, KTDA bosses on Friday issued a panic statement in a desperate attempt to distance themselves from the litany of scandals surrounding the company.
In its shallow communiqué, KTDA failed to address the elephant in the room.
The CEO Wilson Muthaura and Board Chairman David Ichoho failed to explain their politically motivated decision to borrow the illegal tea bonus loans and those responsible for the heinous crime.
They also steered clear of the controversial subject of mistreatment and sexual harassment of staff at the company.
Instead, they threatened to sue media houses that unearthed the massive rot at KTDA.
Various local media had reported that upon his rise to the position, Muthaura embarked on a serious witch-hunt at the headquarters by ruthlessly sending senior staff home and replacing them with his incompetent acquaintances.
This was against due process and only inspired by greed, nepotism and tribalism.
At the time, he also faced accusations of sexual escapades together with a section of KTDA’s top administration.
Insiders described their boss as a “loose zip” and “serial womanizer” with an appalling level of arrogance.
Most recently, he was found in contempt of court after failing to act on orders issued on reinstating the Managing Director of the Kenya Tea Packers (Ketepa) Albert Otochi and the General Manager of KTDA Power Company Japheth Sayi.
In a letter dated September 22, KTDA suspended Mr Otochi and another company official and placed them on half salary, however, the court restrained the authority from effecting the directive.
The two officials went to court in September after they were served a show-cause notice for allegedly interacting with some directors of KTDA.
According to Mr Otochi, Mr Muthaura misrepresented himself as the group chief executive officer, yet he is the general manager of human resources and administration and hence not his supervisor.
He said issuing the letter when he is not his supervisor was unlawful.
He also noted the CEO started the disciplinary process against him, while the human resource policy says suspension should only be issued where there are pending investigations.
Mr Otochi argued that he was suspended, yet there are no pending investigations.
Further, he says the group HR policy also allows him to interact with directors, and the purported charges for gross misconduct for interacting with directors are illegal.
Mr Muthaura was appointed as KTDA’s chief executive following the suspension of the former head, Lerionka Tiampati.
Muthaura brought on his side acting company secretary Mathews Odero.
Odero, according to an insider source, is being used to pay suspicious legal fees running to millions of shillings to several law firms.
To frustrate those senior managers said to be sympathetic to former directors, they have employed the services of one Grace Korit alias “GK”, as General Manager, Human Resource and Administration who took over from Muthaura.
GK, like Kennedy Ochwando, the KTDA Group Head of Procurement and Logistics, takes instructions from Muthaura.
At KTDA, the “mean-looking” Muthaura is referred to as Bwana Rungu by the staff.
GK is a frequent visitor to Bwana Rugu’s office, where they spend time plotting schemes on who to be axed or kept at work based on their loyalty to him.
Senior managers in good books with the cartel are Esther Mburu, Manager of Audit and the stout roundhead “Francis Muthamia” the General Manager of Sales and Marketing and Kanja Thuku, the acting Manager of Operations.
Insiders say millions cannot be accounted for with Muthaura and cronies hiring choppers to crisscross the country visiting factories and flying their slay queens to Mombasa whenever on tour.
The cartel controls the finance, human resources, procurement, operations, sales and audit departments.
KTDA CEO Muthaura Declares War on The Court and Former Officials Alleging Backing from Ruto, Linturi
