Senate public accounts committee accused of extortion

SenatePAC1

Shocking revelations are emerging about how governors from Kenya’s 47 counties are battling a ruthless blackmail syndicate perpetuated by members of the Senate Public Accounts and Investments Committee that has been summoning governors to Nairobi under the guise of answering audit queries.

The sordid details have been exposed following private interviews by governors who have so far received summons. Several governors revealed how members of the committee thrive on harassing and intimidating them, going as far as demanding, off the records, that each of the 12 members of the committee be paid Ksh2.5 million as fees required to ‘overlook’ audit queries. This is the minimum to be paid per financial year, and given that governors have so far served for three financial years, it totals to a staggering Ksh90 million per governor!

In a typical county Ksh 90m can finance the county level 5 hospitals to full capacity in terms of medicine purchase, to offset county inherited debts, cater for public participation activities for 5 years, revamp and build new ECDs, build roads, revamp markets and provide clean water for county residents.

Failure or refusal by governors has been met with threats of production of false but incriminating reports that would paint the governors negatively. In an election year, governors accused of fraud, embezzlement or financial impropriety will find it very difficult to campaign for re-election.

The current members of the Committee are Prof. John Lonyagapuo, Martha Wangari, Hassan Omar, Amos Wako, Kennedy Okongo Mongare, Boni Khalwale, Paul Kimani Wamatangi, George Khaniri, Steven Ole Ntutu, Henry Ndiema and

It is not clear if Senate Speaker Ekwee Ethuro is aware of these serious allegations that put the integrity of the entire senate on the line. It is also not clear if Committee Chairman, Kisumu Senator Peter Anyang’ Nyong’o is partaking to this criminal extortion ring. Nyong’o is known for his strict compliance to the law and leadership integrity.

Numerous senators have declared interest to run as governors in the forthcoming general elections and analysts see this as a desire to control massive resources that are devolved to counties each year by the national treasury. This apparent extortion on governors is a manifestation of illegal fundraising by these ambitious senators ahead of the 2017 campaign period.

Council of Governors chairman, Peter Munya has declared that governors would not attend committee sittings until these allegations of institutionalized blackmail are addressed by the speaker. A visibly upset Governor Munya stopped short of calling for the disbanded of the committee.

The Senate Public Accounts Committee oversees how the 47 counties use allocated funds and audit their investments. It is also specifically mandated with examining reports by the Auditor General on the annual account of county governments and any other reports from the concerning county funds and investments.

Voters will be outraged by this damning exposé given that counties are starved of funds and the senate is abusing its powers to undermine instead of representing the interests of the counties and their governments.

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Safaricom, Scanad and Saracen: White Collar Corruption on a Grand Scale

White Collar Corruption on a Grand Scale

Safaricom, Scanad and Saracen:

Major business partners and shareholders are weighing in on recent corruption revelations at scandal-hit Safaricom even as it emerges that, against business ethics and Safaricom’s own code of ethics, some firms have been irregularly embedded as permanent suppliers at Safaricom.

The recently leaked KPMG report exposed extremely unethical conflicts of interest. What’s more, Safaricom’s own code of conduct has been repeatedly violated by the CEO Bobby Collymore and some of his senior members of management including Sylvia Mulinge the Head of the Consumer Business Unit and the firm’s Head of Risk Nicholas Mulila, who have abused with impunity supplier hospitality standards and partaken in insider trading.

Safaricom senior management has involved itself in distasteful activities that have directly compromised Safaricom’s impartiality in the eyes of competing suppliers and its shareholders.

One case that stands out in Safaricom’s embedded corruption is that of Scanad and its flamboyant billionaire CEO one Bharat Thakrar. Shocking revelations say that Scanad has been offering contractual services to Safaricom for nine years without being competitively awarded. To avoid audit queries, in April 2014 Scanad was irregularly awarded a contract by Safaricom with a monthly retainer of ksh.18m. The contract was to expire in April 2015 as indicated in their award letter. To date, Scanad is still offering the same services to Safaricom, even after their contract expired and without any tender or procurement process.

They are therefore operating illegally and unprocedurally. According to the technical and commercial analysis done during the tendering process in January 2014 that led to Scanad being irregularly awarded the tender, Transcend media won the tender in all categories as noted in the KPMG (Attached) where it states “Although Transcend Media was ranked first during the technical and commercial analysis, we observed that they were not selected” Consequently, despite not being ranked the best vendor, Scanad was still awarded a lucrative contract by Safaricom is required to contractually provide 76 resources to Safaricom on a monthly basis.

They are not based at Safaricom and not directly monitored by Safaricom personnel. A key observation made by KPMG. It is not lost on observers that Bharat Thakrar of Scanad has developed a close relationship with Safaricom MD Bob Collymore and have been seen in many informal social events together.

Thakrar was among the guests Bob Collymore invited for his lavish wedding in 2015. This presents a clear conflict of interest and a serious violation of Safaricom code of ethics on hospitality with company suppliers.

It is strange that although six firms bid for this contract, only Thakrar was present at the invitation-only wedding while the rest of competing firms CEOs only read about the wedding in social media. Why this is so, your guess is as good as mine. Nairobi Stock Exchange pundits and responsible Safaricom senior staff have quietly raised questions about the apparent ‘special’ relationship between Bob Collymore and the Bharat Thakrar? Do both CEOs understand that their close relationship put impartiality into serious doubt? This relationship does nothing to promote the business standing of the two firms but only result in personal gain for the two CEOs.

Does this preferred supplier status enjoyed by Scanad explain why Safaricom irregularly awarded a multi-million tender to Scanad without competitive bidding? Are the shareholders of Safaricom getting value for money out of Scanad? The only explanation that can be given is the corrupt relationship between Collymore and Bharat who runs the corrupt ScanGroup that apparently hires only Indian foreigners in high positions and African slaves in lower cadres. Most of the foreigners do not even have legal papers to work in Kenya. A clear violation of the Kenyan law. In its summary recommendation, auditors KPMG noted that Safaricom did not even monitor the delivery of Scanad to confirm availability of with the minimum staffing requirements set out in the agreement with them. Their focus was instead on delivery of particular projects.

This contrasts with the costing model considered when contracting Scanad. It was revealed earlier this year that senior Safaricom management led by its Director of Consumer Business Unit one Sylvia Mulinge, and its Director of Risk Management, one Nicholas Mulila secretly conspired to deny one company, Transcend Media Group a contract which they won fairly after a competitive bidding process. The tender was instead irregularly awarded to Saracen Media, who had bid with a creative agency called 5ive. Saracen eventually dropped 5ive and were awarded with Mulinge’s shell company called Fieldstone Helms. Our search at the company registry showed that Fieldstone Helms offices are located at Uganda House.

We were shocked when we visited the premises only to find a beauty and massage parlour at the same address. Did Safaricom award a multi-million contract to a beauty and massage parlour?

Further interrogation shows that Fieldstone Helms has neither requisite experience nor the expertise for similar contracts. Furthermore, Fieldstone Helms had never ever been prequalified as a Safaricom supplier and did not even bid for the tender that they were awarded. It has since been confirmed that Sylvia Mulinge single sourced Saracen after the Scanad business was split and an agreement was reached to use Saracen Media for a fee and as front to engage a third party to execute the contract. Saracen Media engaged Mulinge’s shell company, Fieldstones Ltd to provide the services. Mulinge also leaked to them Transcend Media’s technical presentation and then went to further to compromise and secretly pay off Transcend Media staff to undertake the contract on their behalf using intellectual property stolen from a disenfranchised competitor.

The shameful and unlawful insider trading by both Mulinge and Mulila and their associates underlines the circle of corruption and cycle of insatiable greed at Safaricom. This is a group of white collar criminals who have essentially formed a sophisticated club whose purpose was illegal profiteering from Safaricom’s shareholder revenues; and whose members regularly barter lucrative insider information to the detriment of other stakeholders. As suppliers who practice fair trade count their loses, Kenyan and British law enforcement officials and anti-corruption agencies are expected to move into Safaricom to probe these allegations. The legislature is also considering a petition before it submitted by a concerned shareholder/member of the public concerned with the long term effects of endemic corruption at Safaricom.

See below

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Bob Collymore CEO Safaricom, barred from the UK due to allegations of corruption

The SafariconBurgles / SafariconCorruptionBungles series – Part 1

BobCollymore

Ladies and Gentlemen

News reaching this blog from credible and reliable sources indicate that Bob Collymore, CEO of Kenya’s flagship and largest mobile services operator was hurriedly dropped and replaced from representing Vodafone in an international summit to be held in the UK amid allegations of high level corruption uncovered in an audit on Safaricom.

Why would this be of interest? Good question.

Safaricom is one of the largest and probably the top revenue generator in the Kenyan economy. As such any executive in this company is therefore a highly visible personality and their public profile is always a subject of discussion. Recently we have seen snapshots of his low profile “by invitation only” wedding which by all means should have been a private affair, but due to the high public profile, had to be leaked to the media.

Anyway onto the meat and potatoes of this story, why would such a high profile, well known CEO who has recently publicly declared his wealth in a country that is ranked high in Corruption Indices and wealthy individuals hide their dodgy pasts and shady deals, be barred from visiting the UK.

In this exclusive expose, we will lay bare the facts as presented to us and analyse how deep the rot in Kenya truly is. Not just government and its agencies is corrupt, but also wealthy institutions and their managers.

Due to the large volume of documents availed, we will break this expose into several parts. This post is the first in the series.

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It was a huge embarrassment as Bob Collymore is barred from a major international summit following the uncovering of corruption scandals at Safaricom. In what is being seen as a highly embarrassing twist to in Kenya’s corporate circles, Safaricom CEO Bob Collymore has been barred from travelling to United Kingdom to attend a major anti-corruption summit that is being hosted by British Prime Minister David Cameron following the leaking of a forensic audit report by global audit firm KPMG.

Leaked documents reveal a web of corruption in high value contracts at Safaricom which raise serious integrity questions on several senior Safaricom executives led by its CEO Bobby Collymore who was due to be in UK attending the anti-corruption summit as a representative of Vodafone PLC which owns Safaricom.

The Safaricom CEO was forced to call an unprecedented press conference in Nairobi last weekend to deny allegations contained in the leaked forensic investigation report even as his UK bosses barred him from travelling to the international conference.

The UK government is hosting an historic Anti-Corruption Summit between 12-13th May 2016 which comes just weeks after the Panama Papers thrust offshore secrecy and corruption into the international spotlight, and represents an historic opportunity to tackle crime, poverty and instability at the source. The summit will seek to galvanise a global response to tackle corruption.

As well as agreeing a package of actions to tackle corruption across the board, it will deal with issues including corporate secrecy, government transparency, the enforcement of international anti-corruption laws, and the strengthening of international institutions.

It will be the first summit of its kind, bringing together world leaders, business and civil society to agree a package of practical steps to:
• expose corruption so there is nowhere to hide
• punish the perpetrators and support those affected by corruption
• drive out the culture of corruption wherever it exists.

The summit will be preceded by a conference on 11 May for leaders in civil society, business and government who are championing the fight against corruption. According to the official program, Safaricom CEO Bob Collymore who had been listed as one of the speakers at the event, has been removed and replaced by Paul Polman, CEO of Unilever.

This comes in the wake of damming allegations of widespread corruption at Safaricom and a public petition that was presented to the Kenya Parliament by a Kenyan citizen.

An internal forensic investigation done by KPMG to investigate the dealings and modus operandi at Safaricom exposes serious fraud, numerous conflict of interest cases, bribery among others as the order of the day at Safaricom, where internal staff collude with suppliers to hike prices of goods and services and use numerous shell companies to defraud Safaricom Vodafone UK, which partly owns Safaricom was forced to immediately replace Bob as soon as this information became public.

We are also informed that the Serious Frauds Office in London has already launched investigations into this issue. Ironically, back at home, Bob Collymore is spearheading an anti-corruption war in the private sector with the governments backing yet his own organization has been put on the spotlight as the most corrupt in the region.

Citing the trove of leaked documents, the forensic report has revealed that Safaricom contracts worth billions of shillings were awarded to unscrupulous wheeler dealers and cowbow contractors on the basis of insider trading in complete disregard of ethical procurement standards.

Collymore’s fate is now awaiting the outcome of an investigation which has been launched by Vodafone and Government authorities in the UK and Kenya Parliament into Safaricom procurement procedures and contracts awarded in the past.

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We conclude this first part of the series by appending a petition presented to parliament on the alleged corruption at Safaricom by a conscientious and patriotic citizen below

 

President Kenyatta Government a failure on all fronts, pursuing vengeance politics

A_Elect_Uhuru_RutoPresident Kenyatta government has caused the breakdown of the structures of governance, failure on all fronts from economy to external affairs, engaged in dispensation of pursuing a politics of vendetta and selectively targeting opponents. It is abundantly clear that the government’s mindset was one of perpetual confrontation and containment of divergent opinion.

Kenyatta regime is hallmark of democratic regression. For the last 3 years, President Kenyatta government has been insulting, silencing and belittling political opponents. There is justifiably lead for one to the inference that this government does not believe in bipartisan consensus on issues that concern Kenya’s national interests.

Knee-jerk responses and abrupt changes with regard to many national issues have caused setbacks leading to belittling of issues and country’s response thereto, both at national and regional level. Hype, photo opportunities and high profile events cannot be a substitute for serious foreign, economic and , security diplomacy.

President Kenyatta Government’s tenure in office is marked by gross non-delivery, acknowledged failure to fulfil the promises given to the nation and a betrayal of the people, particularly the poor, disadvantaged and the unemployed. It has used smokescreens to hide its failures.

The government has no quality and quantitive jobs creation record but slow growth of economy. The three years of Kenyatta regime has been marked by unaccountable centralization of power, policy making and administrative decisions. This authoritarian style of functioning has resulted in breakdown of the structures of governance, which has paralyzed administration and undermined independence of institutions of governance institutions.

The political atmosphere in the country has been vitiated by design and default in furtherance of Jubilee government’s divisive agenda. There has been a state orchestrated campaign unleashed which has created turbulence, disharmony and distrust and undermined social unity.

Probity, transparency and accountability have suffered a body blow. Mr. Kenyatta has brazened it out and does not act, when serious allegations of corruption and acts of omission and commission surfaced in his regime. Naming of 175 public officials for allegations of corruption and abuse of office was just a smokescreen and opportunity to reorganize his government but not act of tackling corruption.

Ironically, for a leader and party who has been promising transparency and accountability, Mr. Kenyatta , instead of taking any action, has practiced only double-standards, double-speak and hypocrisy on corruption and other governance malpractices.

All the claims of the government particularly with regard to the economic growth and the dynamism that policies are far removed from the ground realities. There has been gross mismanagement of Kenya economy. The GDP growth rate is flat or going down. If one goes by the old methodology, the GDP has grown only at average (a rate of) 5.3% and the government and has been forced to make a downward revision of the earlier growth projection.

If one goes by the Economic Survey, there is a downward revision. So, the earlier projected growth will not be achieved. The debt-to-GDP ratio gone up to 53.6%. The domestic investment sentiment is very low and there are mounting job losses and the youth of the country have been let down. Instead of new jobs being created, jobs are being lost.

In recent months, there has been a sharp decline in jobs in the manufacturing sector because exports have been in a free fall when there are official claims of an emerging economy.

Kenyans are desperate for the 2017 general elections, to get rid of this incompetent government.

Be very afraid of the “KDF Amendment Bill 2015”

The so-called “KDF Amendment Bill 2015” is the biggest threat to civil liberties and democracy in Kenya ever since the repeal of Section 2A of the constitution that had hitherto declared Kenya as a single party state.

Through the KDF amendment bill, Jubilee’s parliamentary dictatorship is seeking to invoke a law that would hand President Uhuru Kenyatta sweeping powers without safeguards that would effectively turn Kenya into a military state without any checks and balances.

The laws will will mark Kenya’s deepening descent into tyranny and will among other scary features effectively make the National Youth Service a key player in internal security and give the Defence docket a blank cheque to unilaterally spend tax payer money.

If these laws are enacted, it would be a severe blow to Kenya’s long and torturous reform journey and would inevitably portend dire consequences for multiparty democracy in Kenya and the entire region.

Here are some points form the proposed law;

1. The role of Kenya Defence Forces (KDF) in internal security could go a notch higher if a proposed new Bill becomes law.

2. The KDF Amendment Bill 2015, if enacted into law, will give express authority to the Chief of the Defence Forces to deploy KDF in civilian operations.

3. The move significantly shifts operational and command powers currently vested in the Inspector General of Police (IGP).

4. Similarly, the Defence Cabinet Secretary (CS) will not play a major role in the delegation of civilian functions to the Chief of staff.

5. The Bill, at publication stage, has the hallmarks of the composition of disciplined forces in Uganda, Rwanda, Ethiopia and Sudan, where there are no clear cut delimitation of the functions of the police and military.

In Uganda and Ethiopia, for instance, the Army is deployed during elections to man polling stations. The proposed law is expected to draw resistance from Opposition, human rights groups and even within government circles.

6. The Bill also envisages establishment of an auxiliary reserve force comprising Kenya Wildlife Service (KWS), Kenya Forest Service (KFS) and National Youth Service (NYS) to serve alongside the KDF.

“The president may in situations of emergency or disaster or during war, unrest, or disaster, order that the auxiliary forces comprising forest guards and NYS be employed to serve with KDF or otherwise in the defence of the nation whether within or outside,” reads the Bill.

7. Under the Bill, the KDF boss has immense powers to monitor implementation of policies, operations and directions issued to service commanders.

8. Under the new Bill, the President has the power to extend the terms of office for the chief, vice chief and service commanders of KDF for a period not exceeding one year.

9. The Bill also seeks to extend the retirement age of the KDF chief from 62 to 64 years.

“The President may, on the recommendation of the Defense Council, extend the term in office of the Chief of the Defense Forces, the Vice Chief of the Defence Forces or the Service Commanders for a period not exceeding one year,” reads the Bill.

The council will direct and oversee deployment of KDF as authorised under this Act and also develop criteria for the recruitment, promotion and transfer of members of the Defence Forces.

10. The bill abolishes requirement for KDF to advertise slots as per counties. It also insulates KDF operations, including appropriation of its budget and functions, from public scrutiny by denying Parliament the oversight role.
However, Parliament would oversight deployment of troops in various operations.

“The Bill proposes to amend section 285 of the KDF Act and repeal section 289 of the same law, which stipulates that KDF should not hold accounts separate from those by the Ministry of Defence,” reads the Bill.

This means that KDF will have its own vote independent of the ministry’s budgetary allocation as appropriated by the National Assembly.

The law currently requires the CS to table an annual report in Parliament and to the Executive, which includes itemised statements on utilisation of public funds by KDF, but the Bill proposes to quash this requirement.

11.In a bid to ensure activities of KDF remain a closely guarded secret, the proposed law seeks to repeal section 290 of the Act to avoid the publication of Defense Council matters deemed to be prejudicial to national security.

#OkoaKenya: The strong case for electoral reforms

iebcTHE OKOA KENYA MOVEMENT has proposed constitutional amendments that, amongst others, seek election reforms aimed at strengthening Kenya’s electoral system to ensure free, fair, transparent, efficient, accurate and accountable elections.

The INDEPENDENT ELECTORAL AND BOUNDARIES COMMISSION (IEBC) prepared a confidential report dated July 2014 on the March 2013 general elections. This devastating report goes on to reveal how IEBC knowingly misled the country and the world, by allowing Kenyan voters to proceed to elections despite glaring omissions and ill-preparedness.
Though the commission claims to have registered 14.4 million people out of 21.8 million eligible voters for the 2013 elections, IEBC concedes that the accuracy of the voter register was compromised. Additionally:

  • The IEBC unilaterally shortened the voter registration period from 90-days to 30-days, thereby disenfranchising approximately 8 million of eligible Kenyans and blocking them from exercising a fundamental right to vote.
  • Further, the IEBC allowed Kenyans to go the general elections without determining the exact number of registers voters, contrary to the law.
  • In total violation of electoral laws, IEBC deliberately gazetted an erroneous voter register whose accuracy was taunted by the existence of illegal multiple registers prepared by the IEBC itself.
  • As if this was not enough for IEBC to halt the process, the commission knew that there was loss of biometric data due to IEBC staff negligence, and that the biometric data captured fundamentally differed with the data on the IEBC manual register
  • To add insult to injury, during the elections, the IEBC audit reveals that there was massive loss of data during the uploading of data from constituencies to regional level, and as a result there were glaring inconsistencies between data captured using the BVR kits and the final voter’s register.
  • In many instances, forms 34, 35 and 36 were not signed nor stamped by the responsible IEBC returning officers as required by law. This anomaly opened a window for competing political forces to manufacture their own election results summary forms.
  • Additionally, the IEBC internal audit fuels doubts in the veracity of the results it’s commissioners announced at the National Tallying Centre at Bomas of Kenya since a significant number of IEBC’s returning officers confirm that they came under intense pressure and were compelled to alter results.
  • In a shocking case of poor procurement procedure and conflict of interest, Electronic Voter Identification (EVIDs) kits were supplied by South Africa’s Face Technologies (whose local agent is an MP from North Eastern Kenya who contested in the same elections and a brother-in-law of one of the IEBC’s commissioners). The large scale failure of the equipment on election day is noted in the report which says they worked in only 7.5% of the polling stations nationwide.
  • IEBC invested billions of shillings in purchase of equipment. Interestingly, none worked as expected with the Results Transmission System (RTS) only being able to transmit presidential poll results from 14,252 out of of 31,981 polling stations (or 44.6%), another window opened for tampering and pussyfooting.

There are many other indictments IEBC places on itself and its commissioners. Nevertheless, this report vindicates the position by Okoa Kenya Movement that the entire elections were deliberately mismanaged and infiltrated by third parties in a bid to attain a predetermined result. It was an absurd subversion of democracy.

Despite the appalling failures in the 2013 general election management, no IEBC commissioner in authority has resigned, or conceded this glaring and systematic failures, instead the IEBC Chairman boldly affirm IEBC’s “readiness” to conduct 2017 elections.

The Okoa Kenya Movement maintains its intention to see electoral reform through positive constitutional amendments to correct these anomalies and strengthen the capability of the IEBC to conduct future general elections.