30 September 2016

Kenya: Sh1.8bn Lost in NYS Scam, Lawmakers Told

The amount lost in the National Youth Service scandal is now believed to be Sh1.8 billion, the anti-corruption watchdog has said.

"The amount lost is much more than the Sh791 million that is known by the public. We have been taking up the matters as the number of suspects increases and investigations move to new areas," Ethics and Anti-Corruption Commission (EACC) chief executive officer Halakhe Waqo told the National Assembly's Public Accounts Committee on Thursday.

According to Mr Waqo, as of last week, the total amount believed to have been stolen from the NYS stood at Sh1.8 billion, in proceeds that have been frozen and seized, or in assets, either in the form of cash in bank accounts or purchased property being pursued.

He told the MPs that the commission was investigating a total of 13 cases, adding that Sh471 million worth of assets had been seized in the past one year.

"We have more than 500 cases in court. Over 800 Kenyans have ongoing corruption cases," said Mr Waqo in response to the lawmakers' queries on whether the EACC had capacity to root out corruption.

He defended the clearance of former Devolution Cabinet Secretary Anne Waiguru of corruption allegations, but stated that the agency was open to information implicating her, especially after an affidavit by one of the key suspects, Ms Josephine Kabura, implied that she was culpable.

The House team's vice-chairman, Mr Jackson Rop, who is also the Kipkelion West MP, had asked whether the EACC was pursuing allegations raised in Ms Kabura's affidavit against Ms Waiguru.

Ms Waiguru was at the helm of the Devolution ministry, when the NYS scandal was exposed.

She eventually succumbed to pressure to step aside over the matter.

When she quit, Ms Waiguru cited health reasons and the doctor's advice to take lighter duties.

PAC chairman Nicholas Gumbo enquired on the status of investigations into the dealings of a firm owned by the family of former EACC chairman Phillip Kinisu.


Mr Waqo said the investigations had been left to a multi-agency team.

Mr Gumbo, who is also Rarieda MP, said the commission had withdrawn from the case to ensure impartiality and transparency in investigations touching on their former boss.

The Directorate of Criminal Investigations is leading a team that includes the Kenya Revenue Authority and the Assets Recovery Agency in efforts to establish whether the former anti-corruption boss was involved in economic crimes.

MPs also heard that the firm, which was paid over Sh54 million, higher than the Sh35 million initially reported, had received Sh2.9 million payment from the scandal-hit NYS in June this year, when Mr Kinisu was at the helm of the EACC, resulting in conflict of interest.

Mr Kinisu had defended himself, saying he had resigned from the firm and left his wife and daughter in charge.

However, as pressure mounted on him to resign, he opted to leave office rather than face a tribunal appointed by President Uhuru Kenyatta.

Mr Gumbo urged the EACC to conduct an audit of the Integrated Financial Management Information System since it had been the "nexus" through which billions had been stolen from the public coffers.

He said the electronic public payment system was shrouded in secrecy.


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