Caption: Former President Mwai Kibaki with President Uhuru Kenyatta With the 2017 general elections approaching, Uhuru Kenyatta is facing the daunting task of taming corruption that has been flourishing leaving key governance institutions such as the judiciary and civil service hollowed out. The president knows too well that failure to weed out corruption will make his re-election for a second and final term a herculean task.
Two weeks ago, Auditor General Edward Ouko, released an annual audit of government accounts. An uproar immediately followed as the scale of mismanagement of public funds became clear. Only 1.2pc of the country’s 2013-14 $10bn (£6.4bn) budget was correctly accounted for. About $600m could not be accounted for at all. Caption : Auditor General Edward Ouko But what is giving the president nightmare is the emergence of a cabal of people in business and wheel dealers who called the shots in the supply of security equipment to Mwai Kibaki’s government, back to the corridors of power. The wheel dealers, some of whom the president schooled with at the prestigious St Mary’s School, are embedding themselves in all key government departments in an attempt to win the lucrative tenders.
The cartel is currently linked to the silent diplomatic feud between Japan and Kenya over the tender involving an international company to manage the second container terminal at the port of Mombasa. To show how things are bad between the two countries, Japanese diplomat recently fired a letter the National Treasury. The chief representative of the Japan International Corporation, Hideo Uguchi, protested bitterly in the manner in which Treasury had interfered in the tender warning any changes at this stage will affect future assistance to Kenya.
The Japanese have been in port expansion projects, and the new container terminal Kenya is procuring an international management has been funded by Japan.
In the procurement process, changes were introduced in the bid documents against Japan government had signed with the government.
Treasury ordered KPA to introduce new rules in the bidding documents. The conditions that have raised eyebrows are that the firm that wins will be given the privilege to work out the financing process for the coming phases of the project.
The planned projects will be under the so-called build, operate and transfer arrangement. Here sources say private firms will be allowed to construct the terminal, manage it for a period and transfer the facility to the government. The said move favors the Chinese companies the cartel is fronting with a section of Treasury.
This will see the selected firm given the first right of refusal in the planning and arrangement for the remaining phases of the project. The Japanese say being the financier to this process, Jica is under obligation to assure accountability and transparency in the process. Already, the director of delivery, Nzioka Waita, has held meetings with officials of both Kenya and Japan to iron out the burning issue. Caption : The head of Presidential Delivery Unit Nzioka Waita The dealmakers who made millions of shillings in the Kibaki presidency but have been finding the going rough in the Uhuru administration have regrouped and are reportedly pushing senior members of the police service and the Interior Ministry to purchase multi-billion-shillings equipment at the heart of the Jubilee government’s promise to modernize the security sector.
The equipment lined up for purchase in one of the most lucrative purchases for the police since independence include helicopters, armored personnel carriers, new firearms and bullet proof vests. But the dealmakers bid to have their preferred foreign firms strike the lucrative tenders has sparked a bitter war with government officials opposed to the deal. This has forced the Public Accounts Committee chairman Nicholas Gumbo to threaten to institute a special audit to ensure the public gets value for its money.
In the Kibaki era the names that featured prominently as the brokers in any security deal at the Office of the President included former permanent secretary Dave Mwangi, businessman Jimmy Wanjigi and former personal assistant to President Kibaki, Alfred Gitonga among others. The ministers were either co-opted or forced to sign the deals. Interestingly, it was former Governance and Ethics permanent secretary, John Githongo who blew the whistle on the mega corruption deals that were being executed at the Office of the President.
Githongo’s dossier forced the United States government in March 2006 to bar Wanjigi and Gitonga from ever stepping foot in US over their role in the Anglo-Leasing scam.
Reads the notification from the United States Embassy in Nairobi barring the two and their associates from visiting US according to WikiLeaks: “(F) VISA SAO REQUEST: ALFRED GITONGA, ANURA PERERA, DEEPAK KAMANI, JAMES WANJIGI Date: 2006 March 2, 11:24 (Thursday) Canonical ID: 06NAIROBI944_ A SUMMARY AND ACTION REQUEST: Embassy Nairobi hereby seeks security advisory opinions under section 212(F) of the Immigration and Nationality Act, Proclamation 7750, suspending entry into the United States of the following individuals: — Alfred Gitonga, — Anura Perera, — Deepak Kamani, — Joseph “Jimmy” Wanjigi. Caption : Controversial Businessman Jimmy Wanjigi All were central figures in a network of alleged corrupt government officials and private sector dealmakers that have systematically stolen or attempted to steal, a cumulative sum as high as $700 million over the past three years by exploiting a secretive system of government security- related procurement contracts in Kenya.
These activities have had serious adverse effects on US national interests in Kenya, which include strengthening democratic institutions and the rule of law and fostering economic development. Gitonga: As personal assistant to the president, he allegedly used his position in the Office of the President to push forward fraudulent contracts in the OP and other ministries, and then divert a significant portion of these resources for personal gain.
A reliable embassy source in the telecom sector reported that Gitonga was also at the center of the eleventh-hour cancellation of the tender for a second national landline phone operator in Kenya in July 2004. Thanks to his position, Gitonga was aware ahead of time of the winner. Invoking the president’s name, he approached the company slated to win and successfully solicited the gratis contribution of 5pc of the shares under the pretense that such a gesture was needed to guarantee to win the tender.
Interestingly, in March this year Interior cabinet secretary, Joseph Nkaissery was forced to suspend the Sh4.6 billion health insurance cover for 125,000 police officers barely hours after the police tender committee approved it and awarded the contract to a consortium that includes Britam Insurance Company. The suspension was communicated to the deputy principal secretary Joshua Irungu, who chairs the tender committee, by Interior PS Monica Juma.
Sources at the Office of the President were quick to attribute the decision to competing for procurement interests at the Interior Ministry and allegations of irregularities. The cancellation of the tender came a few months after Uhuru publicly complained about corruption in his own office and directed the transfer of all procurement and finance staff in an effort to rein in procurement cartels.
Currently, the dealmakers have embedded themselves in government by planting informants who disclose to them the tenders whenever they are floated, the best figure to quote and eventually the firms which have tendered and their quotations.
One person having an edge in this line is Jimmy. For instance, owing to his close rapport with Maluki Mwendwa, the chairman, Nema board of management who is his brothers-in-law as their wives, Irene Nzisah and Victoria Mwendwa are sisters, he has been able to get information on tenders in the department ahead of other bidders. Caption: NEMA Board of Management Chairman Mr Maluki Mwendwa Maluki is also occasionally hired by Jimmy as a consultant in his company known as Aldewright Consultants Limited. This has put Maluki at a vantage position since he gets to know the tenders floated by the government as well as the bidders.
He evaluates the bidders and identifies which companies Jimmy’s firm would offer consultancy services. The facilitation, however, is mainly the assurance of political goodwill and prompt payment.
Jimmy has also embedded himself in Vision 2030 flagship projects; a calculated move since the government has projected timelines on such projects. His interest is mainly in the infrastructure especially those modeled along Private-Public-Partnerships. He has keen interest at the Kenya Airports Authority. At the KAA board, Jimmy has selected board members protecting his interests.
For instance, the construction of the Greenfield Terminal and the development and operation of a CIP/VIP Terminal have been dogged with controversy and boardroom wars, all of which Jimmy is suspected to have ignited.
By igniting the boardroom wars at KAA, he has managed to safeguard the GFT Construction from scrutiny and in return earned a hefty commission.
He also successfully offered consultancy services to Greenside International Limited through his company, Iconic Structures Limited, in the Tender Number KAA/ES/JKIA/476B/ISMS (provision of Integrated Security Management Systems at JKIA).
Jimmy has earned the confidence of Chinese companies, notably Avic International/Catic, a state-owned Chinese corporation. He has hosted the investors and the Chinese ambassador at his Muthaiga 44 residence and the Avic senior managers at his Malindi home. The Chinese are a major source of Jimmy income through money earned as agent’s commission. Catic is undertaking the construction of the GFT, and previously supplied the National Youth Service with equipment. In this tender, the principal secretary in the Ministry of Devolution and Planning, Eng Peter Mangiti is believed to have influenced the ministerial tender committee. Caption: Former Devolution and Planning Principal Secretary Peter Mangiti If a particular tender does not favor him, Jimmy is quick to write anonymous complaints/letters to the Public Procurement Oversight Authority. The complaints are well received by the Director General of PPOA; Maurice Juma is allegedly well remunerated by Jimmy’s brother Sanu Mbui to protect their interests. It is believed that Sani Wanjigi bought a Mercedes Benz, registration KCD 991F, for Maurice.
Jimmy who is shrewd and rich prefers operating behind the scenes, leaving his handlers to do the work. He is the chief executive officer of Kwacha Group of Companies and is the son of former minister and Kamukunji MP Maina Wanjigi.
He is an alumnus of the prestigious St Mary’s School where his classmates included Uhuru, Githongo, Tony Gachoka, Gitonga and Jimmy Kibaki. Caption: John Githongo is the CEO of Inuka Kenya Trust fka Zinduko Trust. Born in 1962, he is married to Nzisah with whom he has two children, Maina and Wambui.
He acquired the Muthaiga house from the late Sunil Behal, a cowboy contractor who made hay during the notorious Kanu regime. The rich Jimmy also maintains an apartment in Hyde Park, London. He is an ardent shopper and shops on Amazon, the United Kingdom for his family effects. He also has a helicopter which, according to sources, is parked in his Muthaiga compound in violation of aircraft parking rules and regulations.
For Gitonga he has a chain of hotels and other businesses mainly in Nairobi. At his Kwacha Group offices, opposition leader Raila Odinga is a regular visitor.