Kenya: CS Rotich, PS Thugge and Nema Boss Wahungu Arrested Over Sh63 Billion Dams Scandal

Nairobi — Top Treasury chiefs have been arrested over the Sh63 billion Arror and Kimwarer dams scandal, following approval of charges against them by the Director of Public Prosecutions Noordin Haji.

Those in custody include Treasury Cabinet Secretary Henry Rotich, his Principal Secretary Kamau Thugge as well as the Chief Executive Officer of the National Environment ManagementAuthority (NEMA) Geoffrey Wahungu.

"They are in custody now awaiting to be taken to court," George Kinoti, the Director of Criminal Investigations told Capital FM News on telephone, "We are looking for more others and they will all go to court."

The three presented themselves moments after the DPP declared that they were wanted persons over the scandal.

Also wanted is the Principal Secretary at the Ministry of East African Community (EAC) Dr Susan Jemutai Koech, Kerio Valley Development Authority (KVDA) Managing Director David Kimosop, Kennedy Nyakundi Nyachiro, Chief Economist at the Treasury who also heads Europe II Division alongside 23 other officials who include Italians from the CMC di Ravena--the firm that was contracted to put up Kimwarer and Arror dams in Elgeyo Marakwet on a government-to-government agreement.

"After analyzing the evidence gathered by the Director of Criminal Investigations, I am satisfied that economic crimes were committed and I have therefore approved their arrests and prosecutions," Haji told a news conference in Nairobi.

Whereas the alleged commercial contract signed between KVDA and CMC Di Ravenna/Itinera JV clearly states that Kimwarer Dam would cost USD 204,020,149.02 while Arror Dam would cost USD 252,188,732.27 totaling to USD 456,208,881 (approximately Sh 46 Billion), Haji said, the National Treasury negotiated a commercial facility increasing the amount to approximately Sh 63 Billion which is 17 Billion more than necessary or required payable on a timely basis without regard to performance or works.

"We now also know that CMC di Ravenna submitted draft technical designs in February 2019 four years behind schedule," Rotich said.

Others facing arrests are Jackson Njau Kinyanjui (Director Resource Mobilization Department National Treasury), Titus Murithii (Inspector General of State Corporations), Paolo Porcelli (Director CMC di Ravenna) CMC di Ravenna - Itinera JV Italy, William Kipkemboi Maina (Head of Supply Chain Management), Paul Kipkoech Serem (Manager Engineering Services), Francis Chepkonga Kipkech (Tender Committee).

Haji has also ordered the arrests of Samuel Kimutai Koskei (Tender Committee), David Juma Onyango (Tender Committee), Patrick Kiptoo (Tender Committee), Elizabeth Kebenei (Tender Committee), Esther Jepchirchir Kiror (Tender Committee), Moses Kipchumba (Ad hoc Technical and Financial Evaluation Committee Team 2) and Eng. Nelson Korir (Ad hoc Technical and Financial Evaluation Committee Team 2).

Others are Eng. Isaac M. Kiiru (Ad hoc Technical and Financial Evaluation Committee Team 2), Eng. Patrick Kipsang (Ad hoc Technical and Financial Evaluation Committee Team 2), Fredrick Towett (Ad hoc Technical and Financial Evaluation Committee Team 2), Jotham Rutto (Ad hoc Technical and Financial Evaluation Committee Team 2), Charity Muui (Ad hoc Technical and Financial Evaluation Committee Team 2), Geoffrey), David Walunya Ongare (National Environment Management Authority) and Boniface Mamboleo Lengisho (NEMA).

Charges facing them include conspiracy to defraud, failure to comply with applicable procurement laws, engaging in a project without prior planning and abuse of office among other economic crimes.

"The investigations established that government officials flouted all procurement rules and abused their oath of office to ensure the scheme went through," Haji said.

While detailing their crimes, Haji said the officials had breached public debt regulations.

"If this project was carried in the strict adherence to the law and existing policies in place to safeguard public interest, it should not have cost Sh63 billion. The evidence establishes malpractices that impacted on our national debt," he said.

"Some Sh4.6 billion was borrowed in addition to the principal amount to pay interest in advance during the construction period, which to date has not commenced. As a country we continue to pay interest on the loan. We borrowed, the loan had interest, we borrowed more money to pay the interest which also attracted interest," Haji said, "A further Sh643 million was released by the National Treasury as a counterpart funds which was meant for the resettlements of the persons that would be affected by the same projects for the compensation of land acquired.

However, there is no evidence that land has been acquired four years down the line. Furthermore, Kenya Forest Service any excision of forest land, pointing to significant adverse impact on the forest ecosystem."

Rotich is on record confirming that the government had spent Sh12 billion to secure funding for the construction of the two dams, with the sum having been paid out to meet set conditions before the actual funding.

"Like any other standard loan facility signed by the government, there are several conditions to be met before funds are available to the borrower and the contractor to commence work," he said in a press statement published in local dailies at the height of the police investigations in March.

The Sh12 billion was part of the conditions precedent outlined in a financing agreement approved by the Attorney General before the National Treasury signed it on April 18, 2017, he explained at the time.

The amount entailed an arrangement fee of Sh545.9 million, a Sh359.5 million commitment fee, a Sh3.5 million agency fee and a Sh11.1 billion insurance premium paid to an Italian contractor.

According to Rotich, the government-owned Italian firm - Servizi Assicurativi del Commercio Estero (SACE) - was paid a Sh7.8 billion advance fee representing 15 per cent of the contract amount.

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