A. Introduction
1. This is an appeal brought against the judgment and sentence of the Principal Magistrate's Court at Malindi (MCCR/E150/2025) delivered by Hon. Nkurrunah Namunyak on January 29, 2026.
2. The Appellant was charged, tried, and convicted of the offence of Stealing by Agent contrary to Section 268(1) as read with Section 283 of the Penal Code.
3. Following her conviction, she was sentenced on February 9, 2026, to pay restitution of Kshs. 673,000 to the Central Amani Women Group within eight (8) months, and in default to serve three (3) years’ imprisonment. Being dissatisfied with both the conviction and sentence, the Appellant filed this appeal on June 9, 2026.
B. Background
4. The Appellant was charged in the lower court with stealing by agent, where the prosecution alleged that between January 2015 and December 2016 in Malindi Sub-County within Kilifi County, being an agent of the Central Amani Women Group, she fraudulently stole Kshs. 788,000 received to be deposited into the group’s Equity Bank account.
5. The trial court conducted a full trial wherein the prosecution called six (6) witnesses. The Appellant testified in her defense as DW1.
6. On January 29, 2026, the trial court convicted the Appellant as charged, finding that she served as the treasurer, was entrusted with funds, and failed to account for missing balances backed by audit findings and an admission letter.
7. On February 9, 2026, the trial court delivered a non-custodial sentence emphasizing restorative justice, ordering restitution of Kshs. 673,000 (after deducting her Kshs. 115,000 chama shares) with a default sentence of three (3) years' imprisonment.
C. Grounds of Appeal
8. The Appellant raised the following primary grounds of appeal in her petition:
a) That the learned trial magistrate erred in law and in fact by failing to appreciate that the prosecution failed to prove its case beyond reasonable doubt as mandated by law.
b) That the learned trial magistrate erred in law and in fact by ignoring material contradictions and inconsistencies in the evidence tendered by the prosecution witnesses regarding timelines, figures, and management practices.
c) That the learned trial magistrate erred in law and in fact by basing a criminal conviction on missing exhibits, unproduced primary documents, and a defective charge sheet that failed to match the evidence.
d) That the learned trial magistrate erred in law and in fact by misinterpreting and misapplying the law concerning admissions, confessions, and extra-judicial notes, wrongly treating a civil debt acknowledgment as a criminal confession contrary to the Evidence Act.
e) That the learned trial magistrate erred in law and in fact by failing to properly evaluate, analyze, and weigh the Appellant's sworn defense, thereby shifting the burden of proof improperly onto the accused.
f) That the learned trial magistrate erred in law and in fact by relying on a flawed, over-extended, and unverified audit report that failed to correspond with the specific particulars of the charge sheet.
g) That the learned trial magistrate erred in law and in fact by entering an unlawful and speculative order of restitution and a harsh sentence founded on ignored material facts and incorrect legal principles.
D. Submissions by Parties
Appellant's Submissions
9. The Appellant advanced robust arguments challenging the safety of her conviction, expanding across several key legal and factual fronts:
10. Failure to Prove Core Ingredients of Section 283: The Appellant submitted that the prosecution failed to establish the foundational elements of Stealing by Agent. Specifically, they failed to demonstrate a formal, legally binding agency framework, a specific entrustment of the alleged funds, and a wilful, fraudulent conversion.
11. Fatal Discrepancies in Timelines and Amounts: Counsel for the Appellant highlighted that the particulars in the charge sheet alleged an offence occurring between January 2015 and December 2016 involving Kshs. 788,000. However, the foundational evidence, including the audit report (PW4) and testimonies from the chairlady (PW1), bandied about completely different periods (such as 2012–2018) and contradictory financial deficits (ranging from Kshs. 673,000 to Kshs. 875,008), leaving the exact quantum shrouded in speculative guesswork.
12. Incompetent and Flawed Audit Evidence: The Appellant attacked the credibility and scope of the audit report compiled by Isika Maina & Associates (PW4/PW5). She pointed out that the audit was a generalized retroactive review rather than a forensic probe tied strictly to the charge sheet, and that the accountant relied purely on secondary records without verifying primary bank deposit slips or cash books.
13. Absence of Vital Documentary Exhibits: Crucial primary documents—such as the official registration certificate of the Central Amani Women Group, meeting minutes authorizing collections, and primary bank statements tracking the exact movement of funds—were conspicuously missing or never formally produced as exhibits, violating the best evidence rule.
14. Misapplication of Law on Admissions (Sections 25 & 25A of the Evidence Act): The Appellant argued that the trial court erred fundamentally by treating an informal, extra-judicial debt reconciliation letter (P. Exhibit 2) as an outright confession of criminal guilt. She maintained that extra-judicial admissions must meet strict statutory thresholds and that negotiating a civil shortfall or acknowledging a bookkeeping deficit under duress does not equate to a criminal confession of theft.
15. Perfunctory Investigations: The Appellant criticized the Investigating Officer (PW6) for conducting a lazy and superficial inquiry, noting that PW6 simply swallowed the group’s allegations hook, line, and sinker without independently auditing the accounts or investigating alternative hypotheses of innocence.
16. Unlawful and Speculative Restitution Orders: Finally, it was submitted that the trial court's order for restitution lacked any secure factual foundation, given that the amounts kept shifting and the essential components of criminal culpability had not been proven beyond a reasonable doubt.
Respondent's Submissions
17. The respondent did not file formal written submissions but relied entirely on the trial records, maintaining throughout the proceedings that the appellant was culpable based on the evidence tendered below.
E. Summary of Detailed Evidence Adduced Before the Trial Court
18. The prosecution presented six witnesses to establish the charge against the Appellant, followed by the Appellant's testimony in her own defense:
19. PW1 (Lovisa Odongo Ochieng — Group Chairlady): Testified that she was the chairlady of the Central Amani Women Group. She stated that the group operated table banking and contributed funds meant to be deposited into an Equity Bank account.
20. She told the trial court that anomalies and missing funds were uncovered during a retrospective review of bank balances conducted around 2019.
21. According to PW1, the Appellant served as the group's treasurer and failed to bank various collections entrusted to her. She alleged that when confronted, the Appellant admitted liability and signed an extra-judicial written commitment letter (subsequently marked as P. Exhibit 2) undertaking to refund a sum totalling Kshs. 825,117. Under cross-examination, however, PW1 conceded that the group lacked proper, continuously reconciled financial books and that primary records like individual deposit slips for specific years were missing.
22. PW2 (Beatrice Wafula Wekesa — Group Secretary): Testified regarding the administrative structure of the women's group. She stated that during her maternity leave in 2014, the Appellant temporarily took over or assisted with certain treasury duties.
23. She claimed that subsequent internal reconciliations revealed cash deficits that could not be accounted for by bank balances.
24. This prompted the group to commission an independent audit firm, Isika Maina & Associates, which purportedly uncovered a massive deposit deficit. On cross-examination, PW2 admitted she could not independently verify how the exact figure of Kshs. 788,000 specified in the charge sheet was arrived at, as it differed from figures bandied about in internal meetings.
25. PW3 (Virginia Munee Mutua — Group Member): Testified as an ordinary member of the group. She corroborated the narrative that members noticed a discrepancy between what was recorded in hand-written cash books and what was actually reflecting in the group's bank account.
26. She confirmed that a special meeting was convened where the Appellant was asked to explain missing funds, leading to the decision to engage an external accountant to audit the books. During cross-examination, PW3 acknowledged that cash transactions were frequently handled informally among members during table banking sessions without immediate banking.
27. PW4 / PW5 (Gibson Scaea Ighombo — Auditor, Isika Maina & Associates): (Note: Recorded interchangeably in the trial records as PW4 and PW5) Testified as an independent expert accountant who reviewed the financial records of the Central Amani Women Group.
28. He stated that he examined loan books, cash records, meeting minutes, and available bank statements.
29. His audit established a cumulative deposit deficit/shortfall of Kshs. 875,008. However, during cross-examination, the witness conceded critical limitations: his audit covered a broad, generalized period spanning from 2012 to 2018, which did not align neatly with the specific timeframe in the charge sheet (January 2015 to December 2016). Furthermore, he admitted that he relied entirely on secondary records and summaries provided by the group's officials, without independently cross-referencing primary bank deposit slips to match specific cash collections directly to the Appellant.
30. PW6 (PC Edwin Rono — Investigating Officer): Testified as the officer who took over the investigation. He stated that he received the audit report from the group, recorded statements from the executive officials (PW1, PW2, and PW3), and subsequently summoned the Appellant.
31. Upon concluding that funds were missing and that the Appellant had served as treasurer, he preferred the charge of Stealing by Agent against her.
32. On cross-examination, PC Rono admitted that he did not conduct an independent forensic investigation into the bank accounts or primary financial transactions, but instead heavily relied on the summaries and documents handed to him by the complainants.
33. DW1 (Lilian Mmbone Babikha — The Appellant): Testified on oath in her defense, denying the criminal charge entirely.
34. She explained that the Central Amani Women Group operated primarily through informal table banking where cash was collected, rotated as loans among members, and managed collectively.
35. She maintained that she never stole, misappropriated, or converted any group funds to her personal use during her tenure as treasurer.
36. Regarding the audit figures, she contended they were based on flawed assumptions, missing receipts, and incomplete records.
37. With respect to the alleged commitment letter (P. Exhibit 2), she explained that she signed a paper under immense psychological pressure during tense group meetings, wherein she only acknowledged a much smaller, disputed bookkeeping discrepancy (around Kshs. 250,000) for the sake of peace, rather than confessing to any criminal theft of Kshs. 788,000.
F. Issues for Determination
38. From the record and submissions, the following issues arise for determination:
(i) Whether the prosecution proved the existence of an agency relationship and entrustment of property under Section 283 of the Penal Code.
(ii) Whether the prosecution proved fraudulent conversion and the exact quantum of stolen money beyond reasonable doubt, including the legal weight to be attached to the audit report and the commitment letter.
(iii) Whether the trial court properly evaluated the Appellant's defense and applied the rules on admissions and the standard of proof.
(iv) Whether the conviction and order for restitution were sustainable in law.
G. Legal Analysis
(i) Whether the prosecution proved the existence of an agency relationship and entrustment of property under Section 283 of the Penal Code.
39. The offense of stealing by agent under Section 268(1) as read with Section 283 of the Penal Code requires clear proof of an agency relationship, entrustment of property in specified circumstances, and fraudulent conversion. While the Appellant admitted to serving as treasurer between 2012 and 2016, a criminal conviction requires strict proof of the corpus delicti and the exact quantum misappropriated.
(ii) Whether the prosecution proved fraudulent conversion and the exact quantum of stolen money beyond reasonable doubt, including the legal weight to be attached to the audit report and the commitment letter.
40. The record shows that an audit was indeed carried out by the firm Isika Maina & Associates (testified to by PW4/PW5), which examined loan books, cash records, minutes, and bank statements, establishing a deposit deficit of Kshs. 875,008.
41. However, the existence of an audit report showing a financial deficit does not automatically establish criminal culpability for stealing by agent.
42. Crucially, the audit examined a broad and generalized period from 2012 to 2018 yielding Kshs. 875,008, which conflicted directly with the specific particulars in the charge sheet alleging an offence between January 2015 and December 2016 amounting to Kshs. 788,000.
43. Further, the auditor relied entirely on secondary documents supplied by the group without independently verifying primary bank deposit slips to tie the missing funds directly to the appellant's actions.
44. Critical foundational exhibits—such as the group's registration certificate, meeting minutes proving authorization or collection, and primary bank records—were either unproduced or missing from the record. While an audit can successfully establish civil or administrative discrepancies within a group, criminal culpability requires rigorous proof beyond a reasonable doubt.
45. The trial court placed heavy reliance on an extra-judicial commitment letter dated February 7, 2022 (P. Exhibit 2) as an admission of liability. However, there is no evidence on record indicating that the Appellant was forced or coerced into signing the commitment letter; rather, her defense was that she wrote it while acknowledging a much smaller figure (Kshs. 250,000) based on assumptions and without proper literacy interpretation of the complex reconciliations.
(iii) Whether the trial court properly evaluated the Appellant's defense and applied the rules on admissions and the standard of proof.
46. From a legal standpoint, relying on the trial records, the commitment letter should not be held as conclusive proof of criminal culpability. Under Section 25 and 25A of the Evidence Act, any extra-judicial admission of a fact tending to prove guilt is strictly inadmissible unless made before a magistrate or an authorized police officer (above the rank of Inspector) in the presence of an independent third party of the accused's choice.
47. The informal civil or extra-judicial acknowledgment of a debt or deficit during an internal group meeting does not automatically translate to a criminal conversion under Section 283 of the Penal Code. Civil liability or a willingness to negotiate a shortfall cannot replace the strict standard of proof required in criminal trials, especially when the underlying figures across the charge sheet, audit report, and restitution orders shifted inconsistently.
48. The burden of proof in criminal trials rests squarely on the prosecution under Section 107(1) of the Evidence Act and never shifts to the accused person.
49. The trial court erred in treating unverified reconciliation figures, an over-extended audit period, and an inadmissible extra-judicial debt acknowledgment as conclusive proof of criminal theft. Because the prosecution's case suffered from fatal contradictions regarding the audit period, unproduced primary records, and an unascertained exact sum, the standard of proof was not met.
(iv) Whether the conviction and order for restitution were sustainable in law.
50. Legality of Restitution and Sentence Under Section 31 of the Penal Code, restitution and compensation must be founded upon proven loss and clear culpability. Because the prosecution's case lacked a secure evidentiary foundation based on the trial records, the resultant order of restitution of Kshs. 673,000 and the default custodial sentence of three years were unsustainable in law.
51. Disposition and Final Orders
52. Accordingly, having re-evaluated the entire record of the lower court as a first appellate court, this Court finds that the prosecution failed to prove the charge of stealing by agent beyond reasonable doubt.
53. Consequently, the following orders are hereby issued:
a) The appeal is allowed.
b) The conviction entered against the Appellant on January 29, 2026, in Malindi Principal Magistrate's Court Criminal Case No. E150 of 2025 is hereby quashed and set aside.
c) The sentence, including the order for restitution and the default custodial sentence delivered on February 9, 2026, is hereby set aside.
d) The Appellant is acquitted and shall be set at liberty forthwith unless otherwise lawfully held.
54. It is so ordered.
DELIVERED AND SIGNED AT MALINDI THIS ……21 st ..DAY OF SEPTEMBER, 2026.
C.AKAIGWA
JUDGE,
Page 2 of 2
1. This is an appeal brought against the judgment and sentence of the Principal Magistrate's Court at Malindi (MCCR/E150/2025) delivered by Hon. Nkurrunah Namunyak on January 29, 2026.
2. The Appellant was charged, tried, and convicted of the offence of Stealing by Agent contrary to Section 268(1) as read with Section 283 of the Penal Code.
3. Following her conviction, she was sentenced on February 9, 2026, to pay restitution of Kshs. 673,000 to the Central Amani Women Group within eight (8) months, and in default to serve three (3) years’ imprisonment. Being dissatisfied with both the conviction and sentence, the Appellant filed this appeal on June 9, 2026.
B. Background
4. The Appellant was charged in the lower court with stealing by agent, where the prosecution alleged that between January 2015 and December 2016 in Malindi Sub-County within Kilifi County, being an agent of the Central Amani Women Group, she fraudulently stole Kshs. 788,000 received to be deposited into the group’s Equity Bank account.
5. The trial court conducted a full trial wherein the prosecution called six (6) witnesses. The Appellant testified in her defense as DW1.
6. On January 29, 2026, the trial court convicted the Appellant as charged, finding that she served as the treasurer, was entrusted with funds, and failed to account for missing balances backed by audit findings and an admission letter.
7. On February 9, 2026, the trial court delivered a non-custodial sentence emphasizing restorative justice, ordering restitution of Kshs. 673,000 (after deducting her Kshs. 115,000 chama shares) with a default sentence of three (3) years' imprisonment.
C. Grounds of Appeal
8. The Appellant raised the following primary grounds of appeal in her petition:
a) That the learned trial magistrate erred in law and in fact by failing to appreciate that the prosecution failed to prove its case beyond reasonable doubt as mandated by law.
b) That the learned trial magistrate erred in law and in fact by ignoring material contradictions and inconsistencies in the evidence tendered by the prosecution witnesses regarding timelines, figures, and management practices.
c) That the learned trial magistrate erred in law and in fact by basing a criminal conviction on missing exhibits, unproduced primary documents, and a defective charge sheet that failed to match the evidence.
d) That the learned trial magistrate erred in law and in fact by misinterpreting and misapplying the law concerning admissions, confessions, and extra-judicial notes, wrongly treating a civil debt acknowledgment as a criminal confession contrary to the Evidence Act.
e) That the learned trial magistrate erred in law and in fact by failing to properly evaluate, analyze, and weigh the Appellant's sworn defense, thereby shifting the burden of proof improperly onto the accused.
f) That the learned trial magistrate erred in law and in fact by relying on a flawed, over-extended, and unverified audit report that failed to correspond with the specific particulars of the charge sheet.
g) That the learned trial magistrate erred in law and in fact by entering an unlawful and speculative order of restitution and a harsh sentence founded on ignored material facts and incorrect legal principles.
D. Submissions by Parties
Appellant's Submissions
9. The Appellant advanced robust arguments challenging the safety of her conviction, expanding across several key legal and factual fronts:
10. Failure to Prove Core Ingredients of Section 283: The Appellant submitted that the prosecution failed to establish the foundational elements of Stealing by Agent. Specifically, they failed to demonstrate a formal, legally binding agency framework, a specific entrustment of the alleged funds, and a wilful, fraudulent conversion.
11. Fatal Discrepancies in Timelines and Amounts: Counsel for the Appellant highlighted that the particulars in the charge sheet alleged an offence occurring between January 2015 and December 2016 involving Kshs. 788,000. However, the foundational evidence, including the audit report (PW4) and testimonies from the chairlady (PW1), bandied about completely different periods (such as 2012–2018) and contradictory financial deficits (ranging from Kshs. 673,000 to Kshs. 875,008), leaving the exact quantum shrouded in speculative guesswork.
12. Incompetent and Flawed Audit Evidence: The Appellant attacked the credibility and scope of the audit report compiled by Isika Maina & Associates (PW4/PW5). She pointed out that the audit was a generalized retroactive review rather than a forensic probe tied strictly to the charge sheet, and that the accountant relied purely on secondary records without verifying primary bank deposit slips or cash books.
13. Absence of Vital Documentary Exhibits: Crucial primary documents—such as the official registration certificate of the Central Amani Women Group, meeting minutes authorizing collections, and primary bank statements tracking the exact movement of funds—were conspicuously missing or never formally produced as exhibits, violating the best evidence rule.
14. Misapplication of Law on Admissions (Sections 25 & 25A of the Evidence Act): The Appellant argued that the trial court erred fundamentally by treating an informal, extra-judicial debt reconciliation letter (P. Exhibit 2) as an outright confession of criminal guilt. She maintained that extra-judicial admissions must meet strict statutory thresholds and that negotiating a civil shortfall or acknowledging a bookkeeping deficit under duress does not equate to a criminal confession of theft.
15. Perfunctory Investigations: The Appellant criticized the Investigating Officer (PW6) for conducting a lazy and superficial inquiry, noting that PW6 simply swallowed the group’s allegations hook, line, and sinker without independently auditing the accounts or investigating alternative hypotheses of innocence.
16. Unlawful and Speculative Restitution Orders: Finally, it was submitted that the trial court's order for restitution lacked any secure factual foundation, given that the amounts kept shifting and the essential components of criminal culpability had not been proven beyond a reasonable doubt.
Respondent's Submissions
17. The respondent did not file formal written submissions but relied entirely on the trial records, maintaining throughout the proceedings that the appellant was culpable based on the evidence tendered below.
E. Summary of Detailed Evidence Adduced Before the Trial Court
18. The prosecution presented six witnesses to establish the charge against the Appellant, followed by the Appellant's testimony in her own defense:
19. PW1 (Lovisa Odongo Ochieng — Group Chairlady): Testified that she was the chairlady of the Central Amani Women Group. She stated that the group operated table banking and contributed funds meant to be deposited into an Equity Bank account.
20. She told the trial court that anomalies and missing funds were uncovered during a retrospective review of bank balances conducted around 2019.
21. According to PW1, the Appellant served as the group's treasurer and failed to bank various collections entrusted to her. She alleged that when confronted, the Appellant admitted liability and signed an extra-judicial written commitment letter (subsequently marked as P. Exhibit 2) undertaking to refund a sum totalling Kshs. 825,117. Under cross-examination, however, PW1 conceded that the group lacked proper, continuously reconciled financial books and that primary records like individual deposit slips for specific years were missing.
22. PW2 (Beatrice Wafula Wekesa — Group Secretary): Testified regarding the administrative structure of the women's group. She stated that during her maternity leave in 2014, the Appellant temporarily took over or assisted with certain treasury duties.
23. She claimed that subsequent internal reconciliations revealed cash deficits that could not be accounted for by bank balances.
24. This prompted the group to commission an independent audit firm, Isika Maina & Associates, which purportedly uncovered a massive deposit deficit. On cross-examination, PW2 admitted she could not independently verify how the exact figure of Kshs. 788,000 specified in the charge sheet was arrived at, as it differed from figures bandied about in internal meetings.
25. PW3 (Virginia Munee Mutua — Group Member): Testified as an ordinary member of the group. She corroborated the narrative that members noticed a discrepancy between what was recorded in hand-written cash books and what was actually reflecting in the group's bank account.
26. She confirmed that a special meeting was convened where the Appellant was asked to explain missing funds, leading to the decision to engage an external accountant to audit the books. During cross-examination, PW3 acknowledged that cash transactions were frequently handled informally among members during table banking sessions without immediate banking.
27. PW4 / PW5 (Gibson Scaea Ighombo — Auditor, Isika Maina & Associates): (Note: Recorded interchangeably in the trial records as PW4 and PW5) Testified as an independent expert accountant who reviewed the financial records of the Central Amani Women Group.
28. He stated that he examined loan books, cash records, meeting minutes, and available bank statements.
29. His audit established a cumulative deposit deficit/shortfall of Kshs. 875,008. However, during cross-examination, the witness conceded critical limitations: his audit covered a broad, generalized period spanning from 2012 to 2018, which did not align neatly with the specific timeframe in the charge sheet (January 2015 to December 2016). Furthermore, he admitted that he relied entirely on secondary records and summaries provided by the group's officials, without independently cross-referencing primary bank deposit slips to match specific cash collections directly to the Appellant.
30. PW6 (PC Edwin Rono — Investigating Officer): Testified as the officer who took over the investigation. He stated that he received the audit report from the group, recorded statements from the executive officials (PW1, PW2, and PW3), and subsequently summoned the Appellant.
31. Upon concluding that funds were missing and that the Appellant had served as treasurer, he preferred the charge of Stealing by Agent against her.
32. On cross-examination, PC Rono admitted that he did not conduct an independent forensic investigation into the bank accounts or primary financial transactions, but instead heavily relied on the summaries and documents handed to him by the complainants.
33. DW1 (Lilian Mmbone Babikha — The Appellant): Testified on oath in her defense, denying the criminal charge entirely.
34. She explained that the Central Amani Women Group operated primarily through informal table banking where cash was collected, rotated as loans among members, and managed collectively.
35. She maintained that she never stole, misappropriated, or converted any group funds to her personal use during her tenure as treasurer.
36. Regarding the audit figures, she contended they were based on flawed assumptions, missing receipts, and incomplete records.
37. With respect to the alleged commitment letter (P. Exhibit 2), she explained that she signed a paper under immense psychological pressure during tense group meetings, wherein she only acknowledged a much smaller, disputed bookkeeping discrepancy (around Kshs. 250,000) for the sake of peace, rather than confessing to any criminal theft of Kshs. 788,000.
F. Issues for Determination
38. From the record and submissions, the following issues arise for determination:
(i) Whether the prosecution proved the existence of an agency relationship and entrustment of property under Section 283 of the Penal Code.
(ii) Whether the prosecution proved fraudulent conversion and the exact quantum of stolen money beyond reasonable doubt, including the legal weight to be attached to the audit report and the commitment letter.
(iii) Whether the trial court properly evaluated the Appellant's defense and applied the rules on admissions and the standard of proof.
(iv) Whether the conviction and order for restitution were sustainable in law.
G. Legal Analysis
(i) Whether the prosecution proved the existence of an agency relationship and entrustment of property under Section 283 of the Penal Code.
39. The offense of stealing by agent under Section 268(1) as read with Section 283 of the Penal Code requires clear proof of an agency relationship, entrustment of property in specified circumstances, and fraudulent conversion. While the Appellant admitted to serving as treasurer between 2012 and 2016, a criminal conviction requires strict proof of the corpus delicti and the exact quantum misappropriated.
(ii) Whether the prosecution proved fraudulent conversion and the exact quantum of stolen money beyond reasonable doubt, including the legal weight to be attached to the audit report and the commitment letter.
40. The record shows that an audit was indeed carried out by the firm Isika Maina & Associates (testified to by PW4/PW5), which examined loan books, cash records, minutes, and bank statements, establishing a deposit deficit of Kshs. 875,008.
41. However, the existence of an audit report showing a financial deficit does not automatically establish criminal culpability for stealing by agent.
42. Crucially, the audit examined a broad and generalized period from 2012 to 2018 yielding Kshs. 875,008, which conflicted directly with the specific particulars in the charge sheet alleging an offence between January 2015 and December 2016 amounting to Kshs. 788,000.
43. Further, the auditor relied entirely on secondary documents supplied by the group without independently verifying primary bank deposit slips to tie the missing funds directly to the appellant's actions.
44. Critical foundational exhibits—such as the group's registration certificate, meeting minutes proving authorization or collection, and primary bank records—were either unproduced or missing from the record. While an audit can successfully establish civil or administrative discrepancies within a group, criminal culpability requires rigorous proof beyond a reasonable doubt.
45. The trial court placed heavy reliance on an extra-judicial commitment letter dated February 7, 2022 (P. Exhibit 2) as an admission of liability. However, there is no evidence on record indicating that the Appellant was forced or coerced into signing the commitment letter; rather, her defense was that she wrote it while acknowledging a much smaller figure (Kshs. 250,000) based on assumptions and without proper literacy interpretation of the complex reconciliations.
(iii) Whether the trial court properly evaluated the Appellant's defense and applied the rules on admissions and the standard of proof.
46. From a legal standpoint, relying on the trial records, the commitment letter should not be held as conclusive proof of criminal culpability. Under Section 25 and 25A of the Evidence Act, any extra-judicial admission of a fact tending to prove guilt is strictly inadmissible unless made before a magistrate or an authorized police officer (above the rank of Inspector) in the presence of an independent third party of the accused's choice.
47. The informal civil or extra-judicial acknowledgment of a debt or deficit during an internal group meeting does not automatically translate to a criminal conversion under Section 283 of the Penal Code. Civil liability or a willingness to negotiate a shortfall cannot replace the strict standard of proof required in criminal trials, especially when the underlying figures across the charge sheet, audit report, and restitution orders shifted inconsistently.
48. The burden of proof in criminal trials rests squarely on the prosecution under Section 107(1) of the Evidence Act and never shifts to the accused person.
49. The trial court erred in treating unverified reconciliation figures, an over-extended audit period, and an inadmissible extra-judicial debt acknowledgment as conclusive proof of criminal theft. Because the prosecution's case suffered from fatal contradictions regarding the audit period, unproduced primary records, and an unascertained exact sum, the standard of proof was not met.
(iv) Whether the conviction and order for restitution were sustainable in law.
50. Legality of Restitution and Sentence Under Section 31 of the Penal Code, restitution and compensation must be founded upon proven loss and clear culpability. Because the prosecution's case lacked a secure evidentiary foundation based on the trial records, the resultant order of restitution of Kshs. 673,000 and the default custodial sentence of three years were unsustainable in law.
51. Disposition and Final Orders
52. Accordingly, having re-evaluated the entire record of the lower court as a first appellate court, this Court finds that the prosecution failed to prove the charge of stealing by agent beyond reasonable doubt.
53. Consequently, the following orders are hereby issued:
a) The appeal is allowed.
b) The conviction entered against the Appellant on January 29, 2026, in Malindi Principal Magistrate's Court Criminal Case No. E150 of 2025 is hereby quashed and set aside.
c) The sentence, including the order for restitution and the default custodial sentence delivered on February 9, 2026, is hereby set aside.
d) The Appellant is acquitted and shall be set at liberty forthwith unless otherwise lawfully held.
54. It is so ordered.
DELIVERED AND SIGNED AT MALINDI THIS ……21 st ..DAY OF SEPTEMBER, 2026.
C.AKAIGWA
JUDGE,
Page 2 of 2