Atwoli alleges Sh5bn NSSF scam

Cotu secretary-general Francis Atwoli. He has alleged that the National Social Security Fund managers approved Sh5 billion for the Tassia Estate housing project without proper procedures. Mr Atwoli is a board member of NSSF. PHOTO/FILE 

In Summary

• Cotu secretary-general Francis Atwoli, who is a member of the National Social Security Fund board, alleged the fund’s managers approved Sh5 billion for the Tassia Estate housing project without proper procedures.
• The Cotu boss said the board of nine members, three of whom have retired, lacked a quorum to approve such a huge amount of money.
• He also questioned why all NSSF tenders have been directed to one company since the tenure of the current NSSF board chairman Adan Mohamed began in 2012.

By PETER OBUYA
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The national insurer irregularly approved the release of more than Sh5 billion of workers’ money for a housing project in Nairobi’s Eastlands, it was alleged Tuesday.

Cotu secretary-general Francis Atwoli, who is a member of the National Social Security Fund board, alleged the fund’s managers approved Sh5 billion for the Tassia Estate housing project without proper procedures.

Opening the lid on what he described as the “scandal of the year,” Mr Atwoli alleged the fund’s acting chief executive, Mr Richard Lang’at, working in cahoots with the board of trustees, had approved Sh5.053 billion for putting up roads and a sewerage system in the new estate.

Mr Atwoli said the cost of the roads and sewerage system should be met by house owners.

Mr Atwoli, who represents workers on the board, claimed no meeting was held to approve the project.

The Cotu boss said the board of nine members, three of whom have retired, lacked a quorum to approve such a huge amount of money.

Mr Atwoli said he was in London on official business at the time.

“Even if they had a quorum, an item involving approval of Sh5.053 billion from an earlier proposal of Sh3.3 billion cannot be approved through a mere note,” he said.

He said Mr Lang’at had, on December 19, signed a communication to the effect that the board had approved the Sh5.053 billion development.

“Any such investment must first be considered by the sub-committee on investment, which I chair, as required by the NSSF Act but that was not done,” Mr Atwoli said.

He said the board had earlier proposed Sh3.3 billion for the project.

The pension provider bought the land in 1995 for Sh2.2 billion.

Squatters, however, invaded it in September 2001, claiming they had bought it.

In 2004, the court ruled in favour of the fund to evict them but this proved difficult as the matter became politicised, forcing the NSSF to sell the plots to the squatters.

A total of Sh2.5 billion was expected from the proceeds of the sale but by May 2011, only Sh1.1 billion had been received. As a result, the pension provider decided to develop the estate to recover its money.

Mr Atwoli also described as suspicious documentation showing how the tender was then awarded to China Jiangsi International Kenya Ltd.

He said the tender committee met the “same day the purported note by Mr Lang’at was circulated” and awarded the contract.

“What a scandal,” he declared before adding: “This is the highest fraud of the fund I have ever witnessed since becoming a board member.”

He also questioned why all NSSF tenders have been directed to one company since the tenure of the current NSSF board chairman Adan Mohamed began in 2012.

Mr Atwoli now wants President Kenyatta to intervene and cancel the tender.

NSSF public relations manager Christopher Khisa said he was on leave.

He told Nation that Mr Lang’at and Mr Mohamed were away in Dubai.

NSSF currently has some 1.5 million members who contribute about Sh600 million per month.

These allegations come even as the fund prepares to increase its monthly collections to six per cent after President Kenyatta signed into law the NSSF Bill 2013