News

EACC launches probe after blocking City Hall payments

Monday, February 3rd, 2020 00:00 | By
Commission chief executive Twalib Mbarak.

Detectives from the Ethics and Anti-Corruption Commission (EACC) have launched a probe at City Hall over what it has termed as possible cases of conflict of interests where some county officials are reported to have used their positions to award and pay tenders to close relative.

The commission chief executive Twalib Mbarak has written to Treasury, City Hall and Central Bank of Kenya (CBK) requesting the suspension of payment of pending bills tallied at about Sh1.5 billion until the investigations are concluded.

Mbarak said the commission has received “credible information” that City Hall intends to make suspected fraudulent payments whereby some beneficiaries are suspected not to have offered any services in a clear case of conflict of interest. 

“In order to safeguard public funds and to ensure that only deserving contractors and suppliers are paid, we advise that the intended payments be put on hold until the commission and other concerned government agencies are stratified that the payments are genuine and that they are being paid to deserving persons,” Mbarak said, telling Treasury to treat the matter as urgent.

Mbarak said EACC is interested in making sure that genuine suppliers are paid their full amount.

“We received information that some people have been demanding commissions for them to effect any payment to suppliers.

Some of the officers have even decided to break the payments in piece meals in order to get large amounts of money in kick-backs,” said EACC spokesman Yassin Amaro.

Close sources to People Daily intimated that EACC’s move to stop pending bills at City Hall was triggered by the 2018/2019 Nairobi City County audit report which revealed that there were several cases of conflict of interest in the procurement process.

Sacked Finance minister Pauline Kahiga has been accused of aiding her relative secure several tenders and paid the company over Sh100 million, a move that is reported to have led to a bitter fallout with Governor Mike Sonko who in December last year transferred her from the docket.

A special preliminary audit report signed by Lucy Mwangi on behalf of the Auditor General dated November 8, 2019 showed that Nanku Company Limited, which according to our search is owned by Nancy Wanjiku Kahiga was irregularly paid several millions among other companies.

The Auditor General in the report 2018/2019, which also listed several other companies, recommended that the funds paid amounting to conflict of interest, should be refunded.

“The contracts resulting from procurement with conflict of interest should be terminated as costs incurred by public entity are made good by the accounting officer.

Recoveries should be made from beneficiaries of firms contracted with conflict of interest,” the report, which was copied to Kahiga, recommended.

Yesterday, Kahiga confirmed that Nanku Company Limited belongs to her relative but rubbished claims that she has been aiding it to get tenders and payment, saying the firm has been doing work with City Hall for close to 20 years.

“Nanku Company has had contractual engagements with Nairobi County for the past twenty (20) years or so...even when it was the defunct Nairobi City Council.

The last contractual engagement Nanku Company completed with the County was in 2017 and they sought a Sh3.1 million payment for works done, certified and confirmed for payment in Financial Year 2018-2019. I was not serving in the finance docket then,” she said.

Nanku Company

She added: ”I joined the Nairobi City County as a Chief Officer in May 2018 having made a declaration of my relation with a Director of Nanku Company.

As such, since joining the County, Nanku Company has NOT been awarded any new contracts...a deliberate decision taken by the company directors not to bid for any tenders at Nairobi County in the interest of safe guarding against possibility of conflict of interest”.

Suspicion about some of the debts, which Sonko inherited from his predecessor Evans Kidero, is said to be the main reason City Hall delayed in settling pending bills.

The position has seen the county listed among the regional governments, which have been blacklisted by Treasury that is punishing counties by withholding allocations for refusing to pay the bills in line with a directive from President Uhuru Kenyatta.

When he took office in 2017, Sonko said the pending bills were approximately Sh64 billion, a figure he said was suspect forcing him to move to court for a moratorium stopping suppliers from forcing him to make payments until the bills were verified.

Sonko the set up the first Pending Bills Committee, which was headed by Senior Advocates PLO Lumumba and Eric Mutua to interrogate the bills. 

More on News


ADVERTISEMENT