Politics and policy
Dr Kioko Mang’eli, the former Kebs managing director. PHOTO | FILE
By BRIAN WASUNA, bwasuna@ke.nationmedia.com
In Summary
- Former Kebs MD Kioko Mang’eli has been accused of using a shell company to defraud a Dubai-based firm of nearly Sh300 million.
- The UAE firm made the claims in court while responding to a suit filed by the allegedly fraudulently registered Geo Chem Middle East Limited against Kebs and the taxman.
- The firm adds that Dr Mang’eli learnt intimate details of his firm when he was still the Kebs MD, and that he has taken advantage of that to hatch the plot.
Former Kenya Bureau of Standards (Kebs) managing
director Kioko Mang’eli has been accused of using a shell company to
defraud a Dubai-based firm of nearly Sh300 million.
Geo Chem Middle East, which is claiming Sh296 million from
Kebs for unlawful termination of its inspection contract, says Dr
Mang’eli formed a company with a name similar to its own in a bid to
dupe the State into paying him the sum.
The UAE firm made the claims in court while
responding to a suit filed by the allegedly fraudulently registered Geo
Chem Middle East Limited against Kebs and the taxman. The UAE firm says
the suit is part of Dr Mang’eli’s grand scheme to defraud it and Kebs of
the cash.
It adds in court filings that Dr Mang’eli forged
several documents and falsified identification details of the Dubai
firm’s directors to form the shell corporation.
The Kenyan firm sued Kebs and the taxman in July,
claiming the amount, allegedly arising from inspection of oil products
imported to Kenya.
“It is an evident fact that Mr Mang’eli has crafted
a scheme whose singular objective is to obtain the funds that are owed
to the company under the pretext that he is the local agent. A copy of
the purported memorandum of association in English and Arabic is a
forgery.
“For instance, in English the entity is referred to
as Geochem ME LLC whereas the Arabic translation is Standard
Verification LLC. My passport number quoted therein is wrong as well as
my place of birth and date of birth,” says Pradeep Gopal, the Dubai
firm’s executive director.
The former Kebs boss is yet to respond to the claims.
Mr Gopal adds that Dr Mang’eli learnt intimate
details of his firm when he was still the Kebs MD, and that he has taken
advantage of that to hatch the plot.
Claims of mismanagement
The Nairobi firm has attached letters from the
ministry of Industrialisation terminating Geo Chem Middle East’s
contract for inspection of oil products imported to Kenya as evidence in
its claim. It had also asked that Kebs deposit Sh296 million in court
until the suit is determined.
Dr Mang’eli left Kebs on September 22, 2009 after a
month-long standoff with then Head of Public Service Francis Muthaura.
He had refused to leave office following a confidential letter sent to
then Industrialisation PS John Lonyangapuo.
His dismissal followed claims of mismanagement and
alleged graft. A report by the Inspectorate of State Corporations to the
Ministry of Industrialisation accused Dr Mang’eli of falsifying
information to justify a salary increment.
Mr Muthaura accused the sacked Kebs boss of
hoodwinking the State Corporations Committee into awarding him a monthly
salary of Sh1.07 million up from Sh480,000.
He allegedly told the committee that he was behind a
turnaround at the State agency that saw it make Sh1.6 billion between
2007 and 2008, up from a Sh300 million deficit it had suffered in 2006.
He had served as MD for three years at the time of his dismissal.
The Ministry of Industrialisation and Enterprise cancelled
the Dubai firm’s contract in April 2010, arguing that the tendering
process a year earlier was flawed.
This was after the company increased inspection
fees from 0.2 per cent to 0.675 per cent of the cost of insurance and
freight that consequently raised fuel pump prices.
Fred Ngatia, representing Dubai’s Geo Chem,
appeared in court during a July hearing and revealed that his client was
actually the one owed Sh296 million for the cancelled contract, and
that he is in mediation talks with Kebs over settlement of the claim.
Justice David Onyancha halted proceedings in the
suit filed by the Nairobi-registered Geo Chem until the Dubai firm’s
concerns are addressed in entirety.
The parties to the suit are yet to set a hearing date to resolve the matter.
A harshly worded letter sent by Mr Gopal to Dr
Mang’eli on August 2 has been attached as evidence in the suit. Mr Gopal
in the letter demanded that Dr Mang’eli withdraw the suit before
Justice Onyancha and issue a public apology.
“Do take steps to immediately remove that case at
the High Court at your personal expense. In addition, you must apologise
for your unashamed act of trying to steal money from the Kenyan
Treasury. Do keep away from our affairs completely and desist from
making telephone calls to us,” the letter reads.
The Dubai-based Geo Chem says it will still pursue
its Sh296 million claim from Kebs even if the State agency was to pay
the same amount to its Nairobi-registered namesake.
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