Former Homa Bay County Assembly Clerk Bob Kephas Otieno has been ordered to refund KSh 12.57 million in public funds alongside two other individuals after the High Court found that money withdrawn from the Assembly's salary suspense account between 2015 and 2017 had been fraudulently paid to people who were not county employees.
The funds were transferred to a joint bank account belonging to Lillian Achieng, a teacher employed by the Teachers Service Commission (TSC), and David Obonyo, who was serving as Business Growth and Development Manager at Equity Bank's Homa Bay Branch.
The payments were recorded as salaries despite neither recipient having an employment relationship with the County Assembly or County Government, raising questions about how public money intended for legitimate salary obligations ended up in a private account controlled by individuals outside the county payroll.
In a judgment delivered on October 16, 2026, Justice Benjamin Musyoki ruled in favour of the Ethics and Anti-Corruption Commission (EACC), ordering Otieno, Achieng and Obonyo to pay KSh 12,571,166.50 to the government. The court found that Otieno, who was responsible for authorising payments during his tenure as Assembly Clerk, had caused the loss of public funds through corrupt and fraudulent conduct, while the two recipients were held liable for receiving money without performing any work or providing services to the county. The decision followed a recovery case filed by the anti-corruption agency in 2022 after investigations established that the transactions had been processed through the Assembly's salary suspense account, a financial account ordinarily used to hold salary-related payments pending reconciliation or clearance.
According to the EACC, the questionable transfers began on December 24, 2015, and continued until December 22, 2017, covering nearly two years during which Otieno authorised payments amounting to more than KSh 12.5 million. Investigators established that the money was deposited into the joint account held by Achieng and Obonyo under descriptions suggesting that the payments were salaries. However, checks against county employment records showed that neither individual worked for the Homa Bay County Assembly or the County Government during the period under investigation. The Commission also established that they were not registered as suppliers or contractors entitled to receive payment for goods delivered or services rendered.
The employment backgrounds of the two recipients became important to the investigation because they demonstrated that the transfers could not be explained as ordinary remuneration from the county. Achieng was employed by the Teachers Service Commission, while Obonyo held a managerial position at Equity Bank's Homa Bay Branch. Their employment elsewhere did not, by itself, establish wrongdoing, but the absence of any documented employment, supply or contractual relationship with the Assembly meant there was no legitimate basis identified for the salary payments. Investigators also examined the timing and amounts of the transfers, which varied considerably and occurred on irregular dates rather than following the predictable monthly pattern associated with normal payroll processing.
The use of the salary suspense account was another significant feature of the case. Such accounts are intended to facilitate the management and reconciliation of salary-related transactions, not to provide an alternative channel through which public funds can be distributed to people outside an institution's authorised payroll. In this case, the EACC established that money was repeatedly withdrawn from the Assembly's account and deposited into the same private joint account without corresponding employment records or evidence of services rendered. The findings placed responsibility on the officials who authorised the transactions and the individuals who received the payments, eventually forming the basis of the Commission's civil recovery proceedings.
The anti-corruption agency subsequently moved to court through ACEC Suit No. E011 of 2022, seeking to recover the entire amount transferred between December 2015 and December 2017. Rather than treating the payments as an ordinary payroll discrepancy, the Commission pursued the matter as a recovery of public money obtained through fraudulent transactions. The proceedings examined the source of the funds, the authority under which the payments were made and whether the recipients had any lawful entitlement to the money. The court ultimately accepted the Commission's case and found sufficient grounds to hold all three defendants responsible for the financial loss.
Justice Musyoki's ruling establishes civil liability for the recovery of the money, although the EACC's announcement of a successful judgment should not be confused with confirmation that the entire amount has already been collected. The court has ordered repayment of KSh 12,571,166.50, and the Commission must ensure that the judgment is enforced so that the money is returned to public coffers.
The case raises broader concerns about financial controls within county assemblies, particularly the procedures used to verify payroll transactions and approve payments from suspense accounts. County assemblies manage public resources allocated to support legislative operations, staff remuneration and administrative services. Their accounting systems are expected to provide safeguards against payments to unauthorised beneficiaries, including checks on employment records, supporting documentation and approval procedures. The fact that the transactions continued over a period of nearly two years raises questions about the effectiveness of those controls at the Homa Bay County Assembly during the period under investigation.
It also places attention on the responsibilities of accounting officers entrusted with public money. A county assembly clerk occupies a position that carries significant administrative and financial obligations, including ensuring that expenditure is supported by lawful authority and proper documentation. Where funds are released as salaries, there should be identifiable employees, approved payroll records and a legitimate basis for payment. In this case, the court found that Otieno authorised transfers to people who had no such relationship with the institution, demonstrating how the misuse of payment approval powers can expose public institutions to substantial losses.
The EACC's successful recovery suit comes as county governments and assemblies continue to face scrutiny over expenditure controls, payroll management and the handling of public funds. The Office of the Auditor-General and the Controller of Budget play important roles in examining the use of public resources, while county assembly audit committees and internal auditors are expected to identify irregular transactions before they develop into significant financial losses. The Homa Bay case illustrates why unexplained payments, particularly those passing through suspense accounts, require timely reconciliation and investigation rather than being allowed to accumulate over several financial years.
For the Homa Bay County Assembly, the judgment leaves important questions about the internal oversight mechanisms that existed when the payments were authorised. It remains necessary to establish how the transactions passed through the institution's financial approval processes, whether internal audits identified the irregularities and what corrective measures have since been introduced to prevent similar losses. The EACC has secured a court order requiring the three individuals to repay the money, but the wider public interest extends to ensuring that county institutions maintain financial systems capable of detecting and stopping unauthorised payments before public resources disappear.
The Commission has reaffirmed its commitment to recovering misappropriated public funds and holding those responsible accountable. With the October 16 judgment now establishing liability against the former Assembly Clerk and the two recipients, attention turns to enforcement of the repayment order and the lessons county institutions must draw from the case. Public money allocated to county assemblies is meant to support public services and legitimate institutional operations, and the Homa Bay transactions demonstrate the consequences when funds are released without a lawful employment or contractual basis.