Public Accounts Committee chairman Nicholas Gumbo speaks during one of
the sittings to probe the National Youth Service scandal. PHOTO | FILE |
NATION MEDIA GROUP
Parliament has decried the failure by key investigative agencies
to get to the bottom of the scandals at the National Youth Service.
The
Public Accounts Committee, the key watchdog team of the House, strongly
criticised the Ethics and Anti-Corruption Commission, the Directorate
of Criminal Investigations and Director of Public prosecutions for
shoddy investigations which failed to unravel the real magnitude of the
theft at the National Youth Service, especially because it is likely
more than Sh1.8 billion had been lost.
The committee’s
criticism came out in the open on Tuesday as it revealed that it had
obtained more information from the Devolution and Planning ministry
showing several billions were paid out from National Youth Service to
date.
The fresh information showed that 17 other banks,
in addition to the 11 PAC has already interviewed, handled the money on
behalf of hundreds of businesses that transacted with the youth
service.
“We realised that the work this committee did
ought to have been done by the investigative institutions of this
country, that is the Ethics and Anti-Corruption Commission and the
Director of the criminal investigations,” said accounts committee
chairman Nicholas Gumbo.
Instead of exposing the
intricate web of looting, the investigating agencies appeared to have
concentrated on the information that was in the public domain, therefore
limiting inquiries into the banks and the businesses involved.
Mr Gumbo said the committee would write to anti-graft agency and
the head of the criminal investigations to ask them if they had probed
the roles of the banks and businesses in perpetrating the scandal.
Although the fresh information has not been analysed, it is suspected
there is more to it than meets the eye.
The accounts
committee has in the past questioned a decision by prosecutor Keriako
Tobiko to list former youth service deputy director-general Adan Gedow Harakhe as a prosecution witness rather than a suspect.
Director
of Criminal Investigations boss Ndegwa Muhoro pointed out the apparent
anomaly when he testified before the committee. Last week, Mr Tobiko
told the committee he was cautious about testifying before MPs as he is
at the same time prosecuting the cases against 35 suspects.
It
was later reported, but he is yet to make it official, that Mr Harakhe
and Hassan Noor Hassan, who was the chairman of the Ministerial Tender
Committee at the Devolution and Planning ministry would be prosecuted
for abuse of office. “We have asked him to submit a report. After
looking at the report we’ll decide whether to invite him,” said Mr
Gumbo.
The anti-corruption agency and that of criminal
investigations would also be asked if they had investigated the Central
Bank of Kenya and any of its officers as the money that went to the
banks was from the Devolution and Planning ministry and youth service
accounts at the Central Bank.
The bank fired off the
first warning shot about the scandal after it wrote a letter to the
Devolution Ministry expressing concerns about the huge payments to
private companies through the National Youth Service.
When
a related letter from then Principal Secretary Peter Mangiti to then
youth service director-general, Dr Nelson Githinji ,was leaked,
Devolution and Planning Cabinet Secretary Anne Waiguru said that Sh791 million had been paid out fraudulently.
Mr
Harakhe later claimed that his password to the Integrated Financial
Management Information System (Ifmis) had been stolen and his account
used to pay out Sh695 million.
In off-the-record
conversations, Public Accounts Committee members have said they are
dissatisfied with the manner in which the auditor-general conducted the
youth service audit.
One glaring mistake by the
auditors was failing to get information from the Central Bank yet it was
the source of all the money paid out, fraudulently or otherwise.
TRANSACTIONS DONE AT NIGHT
According
to the MPs, talking to the Central Bank would have revealed the role of
other banks and individuals in handling the youth service money.
In
the report, only National Bank and Family Bank feature. National Bank
handled the money paid out to cohorts recruited to work in Kibera and
other places, while key suspects had accounts at Family Bank where some
transactions were allegedly done in the dead of the night, some as late
as 2 am.
Central Bank governor Patrick Njoroge has
endorsed the prosecution of some Family Bank employees for failing to
report the suspicious transactions to the financial reporting centre.
“We
levied a maximum penalty to Family Bank. We fined them Sh1 million. We
also required re-vetting of nine employees who were responsible since
there was culpability on their part,” he said when he met Public
Accounts Committee in August.
Information on the banks
is considered important because it can show who was paid from youth
service, giving the committee leeway to question what the money was
being paid for.
In two instances reported to the committee, Ben Gethi and John Kago,
the suspected beneficiaries of the loot, transferred funds to a lawyer
supposedly to handle purchases for them, and later asked him to transfer
the money to other bank accounts.
The committee investigated and found out about the involvement of Elgeyo-Marakwet senator Kipchumba Murkomen and Farouk Kibet, the personal assistant of Deputy President William Ruto.
Mr
Murkomen’s firm — Sing’oei, Murkomen and Sigei Advocates Ltd — was
reported to have been paid Sh5 million by Out of the Box Solutions
Limited, the company that was paid Sh90 million from a dodgy contract
worth Sh302 million before the scandal was detected and payments
stopped.
The duo has for now been spared public questioning and asked to make written submissions, which will be scrutinised.
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