NAIROBI, Kenya Apr 21 – Lawmarkers have recommended a comprehensive forensic audit of the Agricultural Finance Corporation (AFC) following the emergence of widespread financial irregularities spanning more than a decade.
The National Assembly’s Public Investments Committee on Social Services, Administration and Agriculture (PICSSAA) resolved to push for the audit after reviewing reports by the Office of the Auditor General, which exposed what lawmakers described as systemic breaches of fiduciary duty and entrenched malpractice within the state agency.
The decision was reached during a session chaired by Vice-Chairperson Caleb Amisi, where Members expressed alarm at the scale of anomalies, particularly in loan approvals and disbursements.
Appearing before the committee, AFC Director General George Kubai faced tough questions from legislators, who demanded accountability over what they termed as long-running institutional failures.
“Director General, this Committee has cited a lot of malpractice in the Corporation’s operations. Every book of account with us here points to massive malpractice around the approval of loans and disbursements. What is happening in the organization?” Amisi posed.
He pointed out the strategic role of AFC in supporting farmers and bolstering national food security, warning that persistent governance failures risk undermining the institution’s mandate.
“This is a very important organization to this country. We are going to recommend that a forensic audit be carried out to determine where the problem is. We require a full inquiry so that these issues do not recur year in, year out,” he said.
AFC Director Kubai acknowledged past cases where loans were issued on the basis of falsified documents and overvalued collateral, but maintained that most of the concerns raised were historical.
“Honourable Members, the majority of the issues we are addressing are historical. Since I assumed office in 2021, we have undertaken a review of our processes and how we conduct business as an institution,” he said.
Kubai also revealed that the corporation had previously undergone a forensic audit following concerns raised by its Board of Directors an assertion corroborated by officials from the Auditor General’s office.
However, lawmakers remained unconvinced, insisting that the current management bears responsibility for restoring institutional integrity regardless of when the irregularities occurred.
Ndhiwa MP Martin Owino challenged the leadership on the principle of institutional continuity.
“The doctrine of perpetuity demands that even if you inherit an institution plagued by malpractice, you have an obligation to clean up the mess,” he said.
Other MPs echoed similar concerns, with Nominated MP Jackson Kosgey faulting the management for what he termed as a lack of due diligence in loan processing, adding that AFC should by now have evolved into a self-sustaining farmers’ bank.
“The management of this Corporation does not seem to be in charge of its operations. How did you issue loans without proper verification of collateral?” he asked.
Othaya MP Wambugu Wainaina raised the possibility of collusion with corrupt land officials, calling for investigations to extend beyond the corporation.
“A keen reading of this report suggests these malpractices may have involved lands officers. We want to know whether any investigations have been initiated against them,” he said.
Concerns were also raised over non-compliance with statutory requirements, including failure to revalue the corporation’s land assets since 2019 and the existence of at least 16 parcels without title deeds.
Turkana North MP Ekwom Nabuin questioned the security of the untitled land and pressed the management on timelines for valuation.
“The law requires revaluation every five years. When do you plan to comply? And how safe are these parcels without title deeds?” he asked.
The committee further learnt that AFC had failed to pay land rates for 16 years, attributing the lapse to delays in acquiring title deeds for several properties across the country.
In a separate but related matter, the committee resolved to summon the Cabinet Secretary for Agriculture alongside the AFC Board to explain the controversial appointment of the Board Chairman.
Lawmakers heard that the chairman was appointed in 2022 for a three-year term in contravention of Section 6(1)(a) of the State Corporations Act, served the full term without rectification, and was subsequently reappointed in 2025.
MP Amisi directed that both the Cabinet Secretary and the Board Chair appear before the committee to address what he termed as a serious administrative lapse, warning that decisions made under the chairman’s tenure could face legal challenges,