10 July 2018

Kenya: NYS in Fresh Tenders List as Probe Goes On

The National Youths Service (NYS) is inviting suppliers and service providers to register afresh to supply goods and services to the institution for the period between 2018/19 and 2019/20 financial years.

In a statement, the institution asked all current suppliers to apply afresh for consideration after Public Service, Youth and Gender CS, Ms Margaret Kobia, cancelled the previous list of suppliers last week.

SCANDAL

The CS made the announcement when she unveiled the new director general Matilda Sakwa and new crop of procurement officers last week.

NYS is in the eye of the storm following the arraignment of PS Lillian Omollo and former director-general Richard Ndubai on corruption related charges.

The institution was forced to cancel the list of suppliers after some of the companies that are under investigation over the possible loss of Sh9 billion have had previous controversial dealings with the outfit.

While the suppliers have raked in hundreds of millions of shillings in earnings, only one of the companies under investigation has a website but does not list its management.

Others, like Firstling Supplies Limited and Flagstone Merchants, the two firms that walked away with more than Sh1 billion each in the latest NYS scandal, remain largely anonymous operations. Records of some of the entities believed to have been fraudulently paid Sh9 billion are incomplete or missing from the company registry.

And, surprisingly, companies flagged by the Auditor-General and the Ethics and Anti-Corruption Commission (EACC) in the past for possible fraud are still doing business with the government.

CORRUPT OFFICIALS

According to investigators' understanding of what transpired, corrupt officials created companies then assigned them contract numbers ordinarily given to contractors pre-qualified by the Department of Public Works.

Whereas the contract numbers were valid and the pre-qualified companies genuine, the dummy companies were basically shells created to facilitate fraud.

Using a valid contract number, an account could be opened for the shell companies in the Integrated Financial Management Information System (Ifmis).

Local Purchase Orders (LPOs) were then raised in respect of the dummy companies and the impression created that they had supplied goods to NYS.

The fake payments were slotted into the NYS stock of pending bills.

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