Transmara Sugar Company is facing financial trouble after lawyers filed hundreds of cases seeking compensation for cane payment on behalf of farmers who have no idea of the claims or who have died and their documents have been forged.
The sugar company located in Enoosean, Transmara West, is currently battling more than 1,000 cases in various courts in Migori and Kisii towns. The company was acquired by Alteo Group in 2015, and has a presence in Mauritius and Tanzania.
The cases are mainly over non-payment for cane deliveries, or failure to harvest the cane on time, leading to wastage.
Some of the cases have been filed in the names of people who died, without the knowledge of their families. Lawyers have also re-filed old and settled cases in different courts or even in the same court that handled the original suit, but under a different judge or magistrate.
For example, Stephen Ongubo, a sugarcane farmer from Boige, Kisii County, died at Nyangena Hospital aged 93 on May 5, 2015. The death certificate indicates that he died from advanced prostate cancer with senility.
However, in September 2018 his papers were used to file a civil suit in Rongo against the sugar company, claiming compensation for an unpaid cane delivery.
In 2020, Ongubo’s son was surprised to hear that his father had a case against Transmara. In a sworn police affidavit, Zedekiah Nyokangi Ongubo, 57, swears that he has never met the advocates who sued the sugar company.
“I wish to swear that the matter was filed without any authority from the family. The applicant is deceased and could not file a matter three years later after death.”
According to the documents, the matter was filed by Odondi Awino & Company, the same law firm associated with ongoing cases at Sony Sugar. In 2019, the then struggling South Nyanza Sugar Company (Sony Sugar) lost millions of shillings after a clique of lawyers filed fake compensation cases against the firm.
According to Transmara Sugar Company Ltd’s Compliance and Legal Risk officer, Mr Samuel Kalu, the case is one of more than a thousand the firm is currently battling in courts in Kisii, Migori and other towns in the region.
“We started getting this kind of cases in 2014-15, but it all exploded in 2016-17 where cases rose to over 1,000. There was a day we got 300 summonses within a day and that is when the management decided to start investigations,” he said.
In an attempt to understand why so many of its outgrower farmers had sued it, Transmara contracted a private investigator to check the authenticity of some of the cases.
“What we found is an intricate embezzlement done via pretence, filing fictitious documents and forgery in the majority of the cases,” said an officer with Advanced Forensic Ltd, which is investigating the cases.
Advanced Forensics Ltd has previously been part of litigation proceedings in matters involving prominent families. Its scope covers asset recovery, inquiries onto suspect murders and now being at the forefront of the sugar companies that are losing money through fraudulent claims.
The fact that there are sworn affidavits admitted in court raises the possibility that the scam is being perpetrated in collusion with contracted staff and members of the Judiciary.
Another case involves a mother and her two sons that was filed by lawyer Nelson Jura. The case, by Ms Evalyne Ngwono and her two sons Johnson and Geoffrey without their knowledge. Ms Ngwono swears that despite planting sugar cane for Transmara, she has never supplied any to the company.
“I wish to state clearly that I have never supplied sugar cane to Transmara as a miller and I am surprised that one Nelson Jura & Co Advocates have filed a case No CMCC 586/2018 in Ogembo claiming damages for unharvested cane,” she states. She also claimed that she has not met the advocate nor does she know where his office is.
According to the case, the claimants are demanding Sh1,032,000, Sh516,000 (case no. 624/2018), and Sh1,032,000 (case no. 617/2018) without the family’s knowledge.
“My mother is very ill, she never leaves the house, how could she have instructed a lawyer to file a suit?” he wondered. He confirmed that his mother’s name and that of his brother were used by the lawyer, whom they have never met, to file fraudulent cases.
The majority of the lawyers mentioned currently have forgery cases before different courts in the region. Samuel Odingo has a case in Migori and another one in Kisii (2277/2019). Same with Kerario Marwa (Kisii 2176/2019).
Mr Odingo, talking to the Nation, denied any wrongdoing and wondered why those who are claiming that they have not been paid have not been to his office.
“I have never forged any documents in relation to the claimants you are referring to or any other person. I have never filed any case in court on the names of dead persons without knowledge of my instructing clients. I have never been at Sony or Transmara and you may have to verify your facts or source of information, again thanks,” said P. D. Onyango one of the lawyers accused.
According to Mr Kalu, the company is yet to lose money despite all the cases that have been filed against them.
“Yes we have lost some cases,” he said.
What this means is that the money awarded to the plaintiff is either held by the courts or is deposited in a joint account of the company and advocate.
In one of the cases that Transmara lost, they had been sued for about Sh900,000 and ended up paying Sh1.2 million including legal fees. But it is yet to be dispatched because their appeal is still pending.
“The sums involved in these cases might seem small but when multiplied over thousands of cases, the fake claims run into millions,” added Mr Kalu.
