Tag: Auditor General

Questions As Auditor General Reveals That Sh8 Billion From The Hustler Fund Can’t Be Traced‬

NAIROBI, Kenya June 19– Serious questions are being raised over the whereabouts of Ksh8 billion allocated to the Hustler Fund in the 2022/2023 financial year, with lawmakers demanding accountability from the State Department for Cooperatives.

Appearing before the National Assembly’s Public Accounts Committee (PAC), Principal Secretary for Cooperatives Patrick Kilemi faced tough questions over the unexplained variance in the fund’s utilisation.

According to the Auditor General’s report for the year ending June 2023, only Ksh14 billion of the allocated Ksh22.96 billion was utilised, leaving Ksh8.2 billion unaccounted for.

The Hustler Fund, a flagship programme of President William Ruto’s administration, was launched to support youth and small-scale entrepreneurs.

However, its implementation is now under scrutiny due to the significant under-absorption of funds.

PS Kilemi told the committee that only Ksh12 billion had been requested and disbursed from the National Treasury, and that no formal request was made for the remaining Ksh8 billion.

“The department initiated the transfer of Ksh12 billion, which was processed. However, no further request was made for the remaining Ksh8 billion, hence the underutilisation,” he said.

PAC Chair and Butere MP Tindi Mwale criticised the PS for dereliction of duty, noting that as the accounting officer, he was responsible for ensuring full utilisation of budgeted funds.

“You cannot shift blame to officers beneath you. The Principal Secretary is legally mandated to initiate funding requests to the Treasury. Failing to account for Ksh8 billion raises serious questions about transparency and leadership,” Mwale said.

Aldai MP Maryanne Kitany rejected Kilemi’s claim that his role was limited to facilitating transactions on behalf of Treasury and MSMEs, saying such a defence undermines public trust.

“If you were the custodian of the vote for this fund, it was your responsibility to see it through—regardless of whether the department was fully operational. This was a flagship project. Allowing Sh8 billion to lapse undermines government policy and public confidence,” she said.

“You can’t simply call yourself a vehicle. Treasury doesn’t need intermediaries. You knew the importance of this fund and should have acted with urgency,” she added.

Funyula MP Wilberforce Oundo questioned whether any official directive had authorised the shifting of funds from the Cooperatives Department to the State Department for Micro, Small and Medium Enterprises (MSMEs).

“At what point was an executive order issued to shift these funds from Cooperatives to MSMEs? Was this even done legally?” he posed.

In his defence, Kilemi cited administrative delays, explaining that the MSMEs State Department was still being operationalised when the Hustler Fund was launched, and that the Cooperatives docket acted as a temporary host.

But MPs remained unconvinced, accusing the PS of failing to take timely action despite being aware of the fund’s significance.

“You knew this fund mattered to millions of Kenyans. Claiming bureaucratic hurdles now is not only irresponsible—it is dangerous. If you can’t give a better answer, then someone else should,” said Kitany.

June 19, 2025
How IPPs Power Firms Rob Kenyans Blind In Fuel Tender Scam

Electricity consumers have over the years been overbilled owing to malpractices in the procurement of heavy fuel oil that thermal power producers use to generate electricity.

A forensic audit on the procurement of heavy fuel oil (HFO) by the thermal Independent Power Producers (IPPs) by the Auditor General shows that consumers paid billions of shillings over and above what they should have paid in compensating the power producers for what they used in acquiring the fuel.

The money that thermal IPPs spend on fuel is usually passed to consumers and is captured in the power bill as the Fuel Cost Charge (FCC). The charge has been blamed as among the factors that have sustained high power prices in the country.

The audit, covering the period between 2018 and 2021, unearthed instances where IPPs overlooked fuel suppliers with low bids and instead award contracts to those with higher bids, sometimes more than double what had been the lowest bid.

The higher costs were borne by consumers. They would also claim to have used higher amounts of fuel when billing Kenya Power while the actual consumption was lower.

Auditor General Nancy Gathungu now wants the IPPs penalised and also made to return the money that is deemed to have been surcharged on consumers irregularly.

At the same time, she has recommended action to be taken against Kenya Power staff mandated with overseeing HFO purchases among IPPs for failing to protect consumers.

Kenya Power, the report noted, has a responsibility of scrutinising the procurement of HFO by IPPs but failed to fulfil this mandate.

“The instances of irregularities warrant severe assessment of gross misconduct and action to be taken on the responsible parties,” said the Auditor General in the report that was recently presented to Parliament.

The forensic audit was triggered by the recommendations of the Presidential Task Force on the Review of Power Purchase Agreements (PPAs).

The John Ngumi-chaired task force had raised alarm after review of the costs incurred by different thermal IPPs when buying HFO.

It noted a huge variance in the different players paid for the same commodity and purchased under near-similar conditions.

For instance, over 2019, the task force found out that one IPP would buy a tonne of HFO at $526 (Sh73,640 at current exchange rates) on average while another would buy the same at $1,037 (Sh145,180).

The task force recommended a forensic audit of HFO procurement by the IPPs over the five years to 2021 as well as closer supervision by Kenya Power of the power producers in their fuel procurement processes.

Fuel is among the major cost areas for Kenya Power, which paid Sh28 billion in the year to June 2022 to the different power producers operating thermal plants.

Among the areas of concern that the Auditor General identified following the forensic audit were instances where IPPs are claimed to have bought overpriced HFO.

According to the audit, three IPPs awarded separate tenders to Gulf Energy between 2013 and 2019 in which the firm had allegedly overpriced the HFO it sold to the power producers.

The result is that the electricity generators spent a combined Sh1.3 billion more than they would have spent had the IPPs worked with fuel suppliers that had offered the lowest bids. The cost was passed on to electricity consumers.

“Irregularities noted include the following… procurement award of the HFO supply tenders to Gulf Energy who were not the lowest bidders and without any justification led to losses that would have been avoided,” said the report.

Gulf Power, according to the report, incurred a loss of $2.93 million (Sh410 million at current exchange rates), Thika Power ($4.44 million – Sh616 million) and Triumph Power ($1.8 million – Sh252 million).

The report also noted that there was a conflict of interest in Gulf Power – the IPP – buying HFO from Gulf Energy – the oil marketing company – with Gulf Energy owning 80 per cent of Gulf Power when some of the tenders were awarded.

The Auditor General noted instances where Gulf Energy would be contracted to supply the fuel – not just to Gulf Power but also to other IPPs – even where there were other oil marketers that had bid at lower prices.

“In the case of the 2019 Thika Power Tender, Total and RH Devani were the lowest bidders but were disqualified. The tender evaluation report stated that the Gulf Energy bid was the lowest bidder, despite evidence to the contrary,” said the Auditor General.

“Gulf Power, Triumph Power and Thika Power should be held responsible for the losses occasioned through the procurement of more expensive HFO despite the availability of cheaper qualified fuel suppliers. Such actions should include recovery measures,”

“Action should be taken against KPLC staff tasked with oversight of the procurement process for failure to protect interests of electricity consumers in the irregular award of HFO supply tenders to Gulf Energy.”

The Auditor General also took issue with a claim for compensation of more than Sh1 billion by two oil marketers that were left holding huge stocks of HFO following a 2015 review of regulations.

In an April 2016 gazette notice, the Energy and Petroleum Regulatory Authority (then operating as the Energy Regulatory Commission) dropped requirements for IPPs to hold minimum HFO security stocks. This was supposed to ensure security of energy supply in the country.

KenGen had in 2015 commissioned a 280 megawatt (MW) geothermal plant that reduced dispatch from thermal power plants to 12 per cent from an earlier 33 per cent.

Hold huge stocks

This meant that IPPs no longer needed to hold huge stocks of HFO. According to the Auditor General, since the IPPs no longer had to tie this working capital, freeing up of the money that had been tied to the stocks benefited the companies but this was not passed on to consumers.

Instead, consumers had to pay fuel suppliers that were now stuck with huge stocks of HFO.

“Following the low dispatch in 2015 and 2016, Gulf Energy and Vivo Kenya who were the fuel suppliers for Kengen Kipevu III, Iberafrica, Gulf Power, Triumph Power, Thika Power and Tsavo Power wrote to ERC (which has since rebranded to Epra) claiming compensation of $9.75 million equivalent to Sh1.01 billion at an exchange rate of Sh103.67, citing additional financing costs,” noted the audit report.

“After deliberations, ERC approved the request and the amount was recovered from electricity consumers effective July 1, 2017. There was no justification for the payment.”

“There was also no basis for the fuel compensation since the Fuel Service Agreements were signed between the fuel suppliers and the IPPs and neither the government nor KPLC had guaranteed fuel uptake from the suppliers. All fuel orders from the IPPs were to be based on non-binding monthly estimates depending on the project energy dispatch levels.”

June 29, 2023
KURA DG Kinoti On The Spot As Agency Fails To Account For Sh2.7B

The Kenya Urban Roads Authority (KURA) has been in the news lately after the release of a report by the Auditor General. The report details several issues of concern within the organization, and Eng. Silas Kinoti, the Director-General of KURA, has been at the center of the storm.

The Auditor General Nancy Gathungu has once again fingered the Kenya Urban Roads Authority (KURA) over its failure to account for Sh2.7 billion advanced to it. Among the issues cited in the report are inadequate maintenance of roads, lack of proper documentation of expenditures, and the use of outdated equipment.

Gathungu in a report regretted that KURA did not have a separate account for this money as the funds were banked in the authority’s main bank’s account adding that the said money was not supported with a cashbook, bank reconciliation statement and bank confirmation certificates.

“In the circumstances the accuracy and completeness of the cash and cash equivalent balance of Sh 2,717, 690, 436 could not be confirmed, reads the report.

In her latest report tabled in the National Assembly last week by leader of Majority Kimani Ichung’wa, Gathungu also regretted that there was no value for money realised over the construction of the newly built footbridge along the Eastern Bypass Road around city cabanas areas as well as the maintenance of the Nairobi Outering road.

With regards to the footbridge, she said that the institution did not get any value for money due to poor road workmanship done on the bridge.

She revealed that physical verification conducted by the institution in February last year, shows that metal bars had been vandalised thus exposing pedestrians to the risk of being run over by speeding vehicles while crossing the road at undesignated areas. It adds, “In the circumstances, value for money from road assets may not be achieved.”

According to her, Kura maintenance Levy Fund needs to erect tall guardrails of heavy gauge and have a multi-agency approach to protect road assets from vandalism. The construction of the footbridge was carried through funding from African Development Bank (ADB) following the expansion of the 28km Eastern Bypass, which was being expanded into a dual carriageway at the cost of Sh12.5 billion.

Frequent accidents

The queries by Gathungu comes barely four months after motorists plying along bypass in Ruiru, Kiambu County protested over frequent road accidents in the area after over five reported people were killed by speeding motorists at the busy highway.

The bypass dualling project was among 11 major infrastructure initiatives Kenya showcased to international investors during the Belt and Road Forum in Beijing, China, in May 2017.

The Eastern Bypass was constructed as a single carriageway, but since its completion in 2014, considerable urbanisation and commerce along the corridor occasioned significant traffic volumes.

Unpredictable traffic

As a result, severe and unpredictable traffic jams rendered the road unusable as a reliable link to Jomo Kenyatta International Airport (JKIA).

LWith respect to the outering road, she said that physical verification of the project carried out in February last year had revealed that the designated pedestrian foot bridge at the main junction of the outering road and Thika Road lacked barriers and lighting systems.

Further she lamented that the Tassia road section had open drainages clogged with garbage and overgrown vegetation despite the fact that a firm had been contracted to regularly maintain the drains along the road. “In the circumstances, value for money from road assets may not be achieved,” the report states.

Eng. Silas Kinoti, who has been at the helm of KURA since 2019, has been accused of mismanagement of funds and lack of proper leadership within the organization. In particular, the report raises concerns about the use of funds for road maintenance, which is a critical function of KURA.

The report also notes that KURA did not provide the necessary documentation to support expenditure on various projects. This lack of documentation makes it difficult to determine whether the funds were spent in accordance with the law and regulations.

Eng. Silas Kinoti has defended his record, arguing that KURA has made significant strides in the past few years. He notes that the organization has undertaken several road construction and maintenance projects, and that the projects have been completed on time and within budget.

However, critics have pointed out that the lack of documentation and accountability raises serious questions about the effectiveness of KURA’s leadership under Eng. Kinoti. They argue that without proper documentation, it is impossible to know whether KURA is meeting its mandate of maintaining and improving urban roads.

The Auditor General report has sparked a heated debate about the state of KURA and the accountability of public officials in Kenya. Many people are calling for a thorough investigation into the operations of KURA and for those found responsible for mismanagement to be held accountable.

In conclusion, the Auditor General report on KURA raises serious concerns about the management of urban roads in Kenya. Eng. Silas Kinoti, as the head of KURA, has come under scrutiny for his leadership and management of the organization.

One of the most damning revelations in the report is that KURA paid contractors who had not completed their work, resulting in a loss of Sh 51.9 million. This was partly due to Kinoti’s failure to follow due process and ensure that the contractors had fulfilled their obligations before releasing payment.

The report also highlights several instances where KURA overpaid contractors, resulting in a loss of millions of shillings. In one such case, KURA paid a contractor Sh 90 million, even though the contractor had only completed 20% of the work. Kinoti was directly implicated in this case, as he had authorized the payment without following due process.

This latest report is just one of several that have been released over the years highlighting KURA’s financial mismanagement. However, despite these reports, Kinoti has remained at the helm of the authority, with little to no consequences for his actions.

Eng. Kinoti was controversially appointed to the DG position by then transport CS James Macharia despite opposition from insiders that he lacked the integrity of holding such a high office. At the time, many said he was a conduit for Macharia to loot the agency.

Macharia was one of the Uhuru regime CSs who’re on anti corruption scouts with suspicions that he amassed billions from several contracts in the ministries he ran. He’s fondly referred to be one of the four million dollar millionaires in Uhuru’s cabinet.

Before his appointment in June 2020, Kinoti had been acting as KURA Director-General since September 2015.

He joined the authority in 2009 as Manager (Roads) and was later promoted to General Manager (Planning and Environment).

At the time, Kinoti, was accused by critics of helping cartels in the transport sector benefit from state projects through procurement malpractice and irregular contracts.

During his reign, KURA has been accused of giving tenders to cronies, then later advertise as a formality.

KURA is accused of having favoured a construction firm identified as Stecol Corporation to do Ksh19 billion works in Nairobi, Kajiado and Kiambu counties.

The firm was involved in the upgrading of Outering Road. It has also been mentioned in the construction of a bridge at AllSops that will join Outering Road and Thika Superhighway.

Stecol Corporation is also said to have been awarded most of the contracts in the regeneration of roads in Nairobi Eastlands.

It is clear that Kinoti’s continued tenure as Director-General of KURA is untenable. His track record of financial mismanagement and incompetence has cost Kenyan taxpayers millions of shillings, and it is time for him to be held accountable for his actions.

In conclusion, the Auditor General’s latest report on KURA’s failure to account for Sh2.7 billion is a damning indictment of the authority’s financial management. Kinoti’s past record and scandals only serve to highlight his incompetence and the urgent need for him to step down from his position. The government must take swift action to hold those responsible accountable and ensure that such financial mismanagement does not continue to occur in the future.

February 24, 2023
Mischief Prompts Decision To Stop Private Firms From Auditing KenGen And Others

The state appears to be uncomfortable with parastatals engaging international consultancy firms in matters auditing and realignments.

Parliament has directed Auditor-General Nancy Gathungu to order all parastatals under the Ministry of Energy including Kenya Power and KenGen to stop hiring private auditing firms.

The National Assembly raised the red flag that State corporations under the Energy docket continue to advertise for external audit services in breach of the Constitution, the Public Audit Act and the Public Finance Management Act.

The Constitution and the PFM Act, 2012 require the Auditor-General to “audit and report on the accounts of any entity that is funded from public funds.”

The law, however, allows the Auditor-General to outsource audit services after entering into contracts with private audit firms.

But the committee reckons that the firms in the energy sector have been seeking the private auditors on their own.

Abdulswamad Nassir, chairman of the Public Investment Committee (PIC), directed Ms Gathungu to stop the hiring of private audit firms without consultations and approval of the Auditor-General.

PIC issued directive to disengage Private auditors as they were suspected of being pocketed and not capturing financial statements manipulated by management.

The Public Investment Committee raised issues with the move by the State corporations under the Energy docket continue to advertise for external audit services, saying it was in breach of the Constitution, the Public Audit Act and the Public Finance Management Act.

The law allows the Auditor-General to outsource audit services after entering into contracts with private audit firms.

The parastatals however, have been sourcing for private audit firms on their own.

The committee said that private auditors were returning clean accounts (unqualified audit) for State agencies despite outstanding audit queries and procurement irregularities.

National Assembly Speaker Justin Muturi also questioned why private audit firms have always given the parastatals a clean bill of health at a time when the cost of electricity was skyrocketing.

He said that private auditors were always returning ‘clean’ accounts for State agencies despite outstanding audit queries and procurement irregularities.

He called upon the house in its oversight role to question why firms which the government has an interest in always run to private entities when it comes to audit alluding that they hide a lot of dirt in the manipulated report to read clean.

Kengen that was recently on the spot over flawed recruitment process of staff is on the radar over the audit reports that in the recent past has given them a clean template. MPs now want KenGen, Kenya Power and other state agencies in the energy sector to be audited by the auditor general herself for a clear view instead of manipulated reports.

For instance, Deloitte & Touche that handles KenGen was recently busted for allegedly manipulating data for a client. In a leaked document involving Deloitte, one of the largest accounting firms in the world, began circulating on the Chinese social media. The 55-page document (in Chinese), written by a person calling themselves YW who says they were a Deloitte employee at the company’s Beijing office, outlined “serious problems of auditing professional ethics and quality” going back to 2016.

In the document, YW writes: “I have communicated with Deloitte management and Deloitte Reputation and Risk Group (RRG) more than 30 times for 2 years since 2018, requesting Deloitte to deal with audit quality reporting issues properly.”

“However, it is a pity that up until now, all of the people involved in the reporting issues are still engaged” in other important auditing engagements “and have been promoted accordingly.” The employee seems to imply that managerial conflicts of interest may have resulted in inaction up until now.

Among the main accusations which include 10 specific episodes, three of them by another employee who has since resigned is the failure to abide by proper auditing protocol. Auditors took major shortcuts, the report claims, telling their clients that their jobs were thoroughly completed when they were not.

International business consultancy and accounting firms have reached an unchartered phase in the business life cycle. These behemoths of commerce, often tasked with keeping both public and private sector players in check, have now grown powerful enough to pose a threat to entire countries, if not the global economy. After decades of predatory and self-serving behavior, resistance is growing that may well ring in the end of the consulting firm’s era.

India may have provided the initial impetus for pushing the consultancy system over the brink. The country is currently in the process of banning one of the so-called Big Four accountancy and consultancy firms, Deloitte, for aiding financial fraud. New Delhi says it has detected several violations of auditing standards by Deloitte while investigating IFIN, a unit of Infrastructure Leasing & Financial Services, whose debt defaults in 2018 triggered widespread fear of financial contagion.

Fraud at IFIN was “nothing short of organized crime,” India’s Ministry of Corporate Affairs has charged, with the firm “actively aided and abetted by the statutory auditors.” While Deloitte is contesting a government call for a five-year ban on new business, it appears the ministry plans to invoke section 140 (5) of the Companies Act to debar the firm for alleged malpractice.

In 2019, Deloitte was fined£415,000 ($518,000) by Malaysian regulators for audit failures linked to the scandal-ridden state fund 1MDB. Established more than a decade ago, the $583-million investment was meant to finance much-needed development projects across the country. Thanks to endemic corruption, 1MDB accumulated losses of $10 billion, emerging as one of the largest cases of gross corruption in the region. The Malaysian Securities Commission has since struggled to decide if Deloitte was “aiding and abetting” in the graft or was “merely negligent.” As far as the regulator is concerned, there is no third option.

Harrowing stories from South Africa highlight the ruthlessness of these firms evidently operating in a morality-free void. Not shying away from helping corrupt politicians and their agendas, under former president Jacob Zuma major consulting players have all been shown to have dirtied their hands in aiding Zuma’s project to effectively “capture” the South African state.

Kenya Power

In the same light of international firms consultancy, the government shot down a proposal by Kenya Power to single-source three international legal and consultancy firms the utility company had picked to review expensive power purchase agreements (PPAs) blamed for high consumer bills.

Documents presented in Parliament show that the National Treasury, the Attorney-General and the Procurement Agency slammed breaks on Kenya Power’s quest to directly hire the services of Michael Sullivan, the Queen’s Counsel (QC) Howard Barrie, and Mr Jude Kearney.

The Treasury further shot down firm’s request to use Specially Permitted Procurement Procedure to hire the services of consultancy firms PriceWaterhouseCoopers (PWC), McKinsey & Company, and Boston Consulting Group.

Kenya Power’s decision to seek the services of the experts followed the March 21 decision by President Uhuru Kenyatta to appoint a taskforce to review PPAs signed between Kenya Power and all electricity generators with a goal of renegotiating the energy prices and other terms downwards.

The 15-member team, chaired by boardroom veteran John Ngumi has recommended a number of reforms including renegotiation of all PPA’s contracts that Kenya Power has signed with electricity producers that also dictate modes of engagement, including payment.

The proposals that are expected to reduce the cost of power by 33 percent – from Sh24 per unit of electricity to Sh16 per unit by December this year.

Kenya Power signed contracts committing it to take more electricity than it can sell, leaving it to pay onerous capacity charges to energy producers even when their plants are idle.

Mr Howard Barrie and Mr Jude Kearney were to be hired to advise KPLC and the Presidential Taskforce on the review of the PPAs and the renegotiation strategy.

PWC was to undertake financial analysis of PPAs, McKinley was to be hired as management consultant while Boston Consulting Group was to offer the taskforce “a wealth of cross-cultural experience.”

Members of the Energy committee, who probed the PPAs, have now questioned why KPLC wanted to bring in the international experts at the time the taskforce was conducting a investigations into the PPAs.

Consultancy and accountancy firms are the only ones big enough to audit states or multinational corporations (MNCs), and have thus developed into quasi-cartels capable of influencing the paths of entire countries through their intimate connections to the centers of power and decision-making.

While their work as auditors is no doubt crucial to providing accurate reports to shareholders, they have a broader responsibility to simultaneously safeguard economies on a national and global scale. That is, after all, what they are paid to do. Or so the theory goes.

In reality, they have aided those with financial interests to avoid taxes and cook the books since their first conception in the ancient economies of Mesopotamia and Babylonia.

November 15, 2021
KMTC Officials On The Spot Over Missing Sh7M Cash

Officials at the Kenyan Medical Training College on the Kuria campus collected $ 7.1 million in cash from students as fees, but never transferred the money.

The money was in the form of cash collected directly from the students, but the same was not reflected in the students’ accounts in June 2019.

Auditor General Nancy Gathungu has expressed doubts whether the college would get the money back, which is a large chunk of the outstanding Fees of Sh 10.4 million. made campus.

She raised the concerns in her report on the institutions’ finances for the year ending June 30, 2019, recently presented to Parliament.

Gathungu also gave Sh8 , 2 million of what was recorded in cash books but not in bank statements, hence “an indication that the cash was not deposited intact, contrary to financial regulations”. 559,738,289 reported on the balance sheet as of June 30, 2019, undetectable, ”said the auditor.

Officials also failed to show checks for 2.7 million shredders for processing in audits p> The Auditor General also expressed doubts about the collectibility of the unpaid fee balance of Sh 46.8 million for more than a year.

The audit also found that KMTC students still had fees of Sh 380 million as of 30 June 2019.

“Under the circumstances, the validity, correctness and full collectibility of the entire receivables balance reported as receivables from stock exchange transactions could not be confirmed,” said Gathungu.

KMTC, so the report is embroiled in a dispute with the University of Nairobi over 96 rooms that were occupied by medical students at the university at the rate of Sh80 per day.

The rent was at Sh73. accumulated 0.8 million in June 2019, with the auditor questioning why the lease was not presented to her for review.

G athungu cast doubt on the college’s ability to get the money from the rent it had accumulated over the years would get back.

“Although management has indicated that the college has issued letters of formal notice to the university to settle the outstanding amounts and a leave notice so the college student can occupy the dormitories, the rent is said to be down has been accumulating for over 20 years, ”the audit report said.

Also worrying is that the college failed to assess and disclose in records some parcels of land occupied by 45 campuses across the country.

KMTC also has no auditing, title documents for 18 plots at headquarters and constituent colleges with acreage of 241,731 hectares valued at 333 million shorts.

“As a result, it could The accuracy, completeness and ownership of land with a value of 333 million short on June 30, 2019, is not confirmed, “said Gathungu.

She also asked why the college still needs to upgrade its land, the last was in 2005.

The 2005 valuation, which was more than 16 years ago, put the property at $ 1.165 billion, with the auditor saying the college’s assets may be severely undervalued.

“Management has not explained why the college property has not been revalued since 2005 to determine the fair value of the property,” said the Auditor General.

“Under the circumstances, I cannot confirm the existence of effective internal controls in the countryside,” she added.

The auditor also indicated the accuracy of the information on the institution’s performance for the year and gave a deviation of 55 4,123,706 Sh an on both the income and expenditure votes.

November 7, 2021
Audit Report Exposes MPs Stealing From The CDF

Another 47 MPs have been fingered over misuse of funds meant for bursaries and development projects in their constituencies.

In various reports tabled in the National Assembly, Auditor General Nancy Gathungu has detailed how the MPs misappropriated funds allocated to their areas.

Among the constituencies identified are Nyatike, Mt Elgon, Lagdera, Suba North, Kuria East, North Mugirango, Gatanga, Bobasi, Laikipia West and Gatundu South.

Others are LamuWest, Wajir West, Kitutu Chache, Kiambaa, Mathioya, Suna West, Kitutu Masaba, Kabuchai, , Banisa, Lamu East, Kitui East, Kitui Central, Kibwezi West, Kangundo, Mwingi North and Kanduyi.

Also on the spot for abuse of set criteria are Teso North, Butere, Mumias West, Kaloleni, Wajir North, Mandera South, Gichugu, Laisamis, Kirinyaga Central, Mandera North, Shinyalu, Funyula and Matungu.

In Millie Odhiambo’s Suba North constituency, Gathungu raises concern over various issues including irregular bursary disbursements, irregular construction of Mbita Medical Training Centre and questionable gravelling of access roads.

Gathungu reported that bursary funds amounting to Sh40,000 was paid for a student at Tom Mboya High School but a review of the records revealed the student was not registered in the school.

“Consequently, the regularity and validity of the expenditure of the bursary amount of Sh40,000 could not be ascertained,” reads the report.

It notes that the NGCDF committee spent Sh3 million on bush clearing, dozer work and gravelling of a 2km road to Wakondo Primary School and another Sh3.9 million being incurred on grading of a 2.6 km access road to Nyamaji Kisaka and Ndhuru Primary Schools despite the projects falling under the county government which is contrary to the National Government Constituency Development Act.

Construction advertised The report shows that out of Sh2 million allocated for the establishment of Mbita Medical Training Centre, a review of records revealed that Sh1.8 million was spent before the project started, adding that the tender for construction was advertised in only one newspaper contrary to provisions of the Public Procurement Act 2015.

In Peter Masara’s Suna West constituency, Gathungu raised concern over unsup ported bursary disbursements to secondary and tertiary institutions amounting to Sh25.6 million, which had no supporting documents such as the beneficiary’s identity cards, fee statement balances and admission letters.

“Further evidence of vetting of the beneficiaries by the bursary sub-committee as required under regulation 21(3) of the National Government Constituencies Development Fund regulations was not provided. Consequently the accuracy and validity of the expenditure totaling Sh25.6 million incurred on bursary disbursement could not be confirmed,” adds the report.

No vetting In Central Imenti, Gathungu fingers area MP Mosses Gachine, over unsupported bursaries totaling Sh27.4 million because the list of applicants and bursary committee minutes showing how beneficiaries were vetted and awarded was not provided.

She also raises concern over another Sh5.9 million, which was not supported by an acknowledgement from the recipient institution.

“In the circumstances, the accuracy, completeness and validity of bursaries amounting to Sh27. 4 million for the year ended June 30, 2019, could not be confirmed,” adds the report Gathungu also raises queries over an unsupported emergency project worth Sh1.3 million for the completion of Kauthene Police Post yet a report of the urgent unforeseen situation and bills of quantities were not provided.

She also questions a transfer of Sh52.5 million to three primary schools for construction and renovation of buildings yet there were anomalies on how the money was spent.

The schools in question are Gatuatine Primary School, Ngeene Primary School and Kirigara Primary School.

In Robert Gichumu’s Gichugu constituency, Gathungu questions bursaries worth Sh 34.6million to secondary and tertiary institutions. According to her, out of the money only Sh28.7million was acknowledged through letters and receipts by the beneficiaries leaving a balance of Sh5.9 million.

Unapproved ICT expenditure She also pokes holes on what she terms unconfirmed project management committees bank account balances totaling Sh16.6 million as well as unapproved Information Communication Technology (ICT) hub expenditure.

“In the circumstances it has not been possible to ascertain if the Sh5.9 million bursaries benefitted the intended beneficiaries and whether it was expended as appropriated in the year under review,” notes the report.

In Abdullahi Bashir’s Mandera North constituency, Gathungu reveals that there was unsupported bursaries totaling Sh9.7 million, as official receipts or acknowledgement letters by beneficiaries did not support it.

“Consequently the accuracy, completeness and validity of the expenditure for the bursaries of Sh 9.7 million could not be ascertained.”

She also reveals that procurement of sports equipment worth Sh1 million was not supported by documents.

In Mathioya constituency, area MP Peter Kimari has been fingered over unsupported bursary to needy students in secondary and tertiary institutions totaling Sh 5.9 million.

She also raises questions over unsupported expenditure on environment totaling Sh1.9 million for purchase of seedlings but no evidence was provided to confirm the seedlings were delivered.

In Lamu East, area MP Sharrif Athman is on the spot over unsupported bursary payment to secondary schools and tertiary institutions amounting to Sh25.4 million as minutes of the bursary committee meetings were not provided while another Sh15.5 million disbursed to various institutions was not acknowledged through the official receipts of beneficiary institutions.

In Stanley Muiruri’s Lamu West constituency, Gathungu raises concern over bursary disbursements totaling Sh24 million as it was not supported by minutes of bursary meetings. She also raises concern over delayed implementation of projects in the constituency as nine initiatives with a combined budget of Sh23.9 million were yet to be started.

October 28, 2021
Audit: Sh32 Million From Covid-19 Emergency Response Fund Board Was Sent To 7K Persons With Same Names But Different M-Pesa Numbers

Nothing is new under the sun and corruption is becoming a norm in Kenya, nothing is too divine to touch, while country struggles with the adverse effects of the pandemic that has seen incomes shrink with many left out in unemployment, the pandemic has been a blessing to a few crooks privileged to hold high offices controlling Covid funds.

To cushion Kenyans living in the urban informal sectors from the harsh effects of the pandemic, President Uhuru in 2020 established cash transfer program to the vulnerable groups in the society, including the aged too. Uhuru established the Covid-19 Emergency Response Fund Board whose primary mandate was to mobilise resources for an emergency response towards containing the spread, effects and impact of the COVID-19 pandemic. Other objectives of the fund included supporting the government’s efforts in the supply of medical facilities and equipment and support for vulnerable communities with their immediate needs, including food.

The board developed a Cash Transfer Program of Kshs.400, 000,000 aimed at benefitting 100,000 Kenyans weekly in urban informal settlements for a period of one month.

The mapping of the vulnerable categories of persons to benefit from the cash transfer programme would be guided by considerations such as persons who were on employment but rendered jobless due to COVID-19, persons within a family set up and those who had not been beneficiaries of funds from any Government related intervention. The Board approved the cash transfer programme on 2 June,2020 and Kshs. 400,000,000 was transferred to MPESA Holding Company Limited to be disbursed to the identified beneficiaries.

According to auditor-general’s report seen by Kenya Insights, the money was transferred from an irregular account of the board at Absa to Mpesa.

The disbursements were done in 4 phases. Detailed recipient’s phone number, names, receipt number, provided for audit from Safaricom through the Fund Accountants (PricewaterhouseCoopers). Location of the recipients was, however, not indicated, and as a result, the special audit could not therefore confirm if the beneficiaries were from urban informal settlements.

The audit revealed that a total of 97,515 persons benefited from the cash transfer program. Out of these, 95,727 were registered Mpesa users while 1,788 were not registered. The highest amount disbursed to a beneficiary was Kshs 24,000 while the least amount disbursed was Kshs 1,000.

Analysis of the data provided revealed that, there were 38 payments done to the same Mpesa telephone number but with different names amounting to Kshs 72,000.

Similarly, there were 7,850 beneficiaries who shared names but had different Mpesa telephone lines who were paid a total of Kshs.32,626,000. The identity card (ID) numbers of the recipients were not provided for audit and analysis. In absence of the identity card numbers and in view of the time constraint, the special audit was not able to independently verify that the recipients of the cash transfers were the bona fide beneficiaries or that the cash was received. Consequently, the lawfulness and effectiveness of utilization of the Kshs.400,000,000 could not be confirmed.

According to a statehouse statement issued on 30 March, 2020, President Uhuru according to the COVID-19 Emergency Response Fund Regulation, 2020 established a Board responsible for the management of the fund.

Ms. Jane Karuku, was appointed the chairperson, Fred Matiang’i served in his capacity as the CS, Wycliffe Oparanya, as chairperson of the Governor’s council. Members of the board included; Michael Joseph, James Mwangi, Dr. Narenda Raval, Joshua Oigara, Jeremy Awori, Wachira Waruru, Mohammed Hersi, Ms. Phyllis Wakiaga and Kennedy Kihara as the secretary.

The audit report has faulted the management of the fund red flagging it’s oversight framework.

The audit established that on 12 June 2020, the Fund Board registered the Kenya Covid-19 Emergency Fund Limited under the Companies Act, 2015 as a Company limited by guarantee. The audit noted that the Fund Board approved the establishment of the Fund as a corporate entity for procurement and logistics purposes in a Board meeting held on 14 April, 2020.

The certificate of incorporation indicates the Company Registration Number as CLG- PPFDDA and the registered office of the company as ALN House, Eldama Ravine Close Off Eldama Ravine Road, P.O. Box 200-00606 – Sarit Centre.

It was not clear why an entity established under the Public Finance Management (COVID- 19 Emergency Response Fund) Regulations, 2020 as the COVID-19 Emergency Response Fund Board with clear governance, management structures, systems and procedures outlined in the Public Finance Management Act, 2012 and the attendant Regulations was again registered as a Company Limited by Guarantee under the Companies Act, 2015 indicating it was a private company receiving donations from well-wishers.

A review of the inauguration Board meeting minutes (MIN 5/1/4/20 held on 1 April 2020) notes that the Members were briefed about the Fund Regulations issued by the National Treasury but unanimously resolved to adopt a private sector steered approach for purposes of instilling and assuring public confidence in the process. The Board decided to develop its own procedures and workplan in the performance of its mandate.

The audit established that, the Fund opened a Bank Account with Absa Bank Kenya PLC, the account name being Kenya COVID-19 Fund, Account Number 2042554653 at Absa Towers Branch. Though the decision to open the Bank Account was approved by the Fund Board, there was no evidence of approval by the Cabinet Secretary to The National Treasury for opening the Bank Account. The Fund also operated an MPESA pay-bill number 999000.

In her submissions, Nancy Gathungu, the auditor-general has recommended that the Ethics and Anti-Corruption Commission and the Directorate of Criminal Investigations should conduct further investigations to establish acts of criminality in all irregularities identified by this special audit.

June 23, 2021
How MPs Loot Using Fake Mileage Claims

The Parliamentary Service Commission (PSC) is on the spot over Sh16.6 million paid to three MPs irregularly.

The three lawmakers blew out Sh16.6 million in triple payments for domestic travel, mileage claims and overseas travel, all done in the same day.

The three MPs were paid Sh11,392,479 in domestic travel and subsistence in respect of mileage claims.

“However, no explanation was provided as to why three Members were paid twice or thrice for the same date of travel,” Nancy Gathungu, the Auditor-General said in a report to Parliament.

Ms Gathungu said further examination of payments for claims by MPs for mileage and domestic subsistence facilitation revealed instances where some legislators were paid domestic subsistence facilitation and mileage claims amounting to Sh5,219,357 on days when they were outside the country and already receiving foreign subsistence allowances.

“In the circumstances, the propriety of the expenditure of Sh11,392,479 and Sh5,219,358 included under domestic travel and subsistence in the statement of receipts and payments for the year ended June 30, 2020 could not be determined,” Ms Gathungu said.

The Treasury has allocated Parliament Sh37.7 billion in the current financial year.

MPs are ordinarily reimbursed weekly mileage of about 18,000 per kilometre for return trip per kilometre depending on the distance covered. Those travelling long distance like Mandera, Lamu, Garissa Wajir, and Turkana pocket more than Sh1 monthly.

Mileage reimbursement is usually claimed Monday to Friday by MPs also draw Sh5,000 per committee sitting, while chairman laughs all the way to the bank with Sh15,000. Vice chairpersons draw Sh7,500.

Other perks include domestic subsistence (Sh19,000), house allowance (Sh2000,000). And Medical (Sh10 million) among others.

In a qualified audit opinion for the year ended June 30, 2020 Ms Gathungu said the PSC spent Sh303,881,415,626 in respect of use of goods and services.

“As disclosed under Note 4 to the financial statements, the expenditure includes an amount of Sh1,395,384,441 relating to domestic travel and subsistence out of which Sh11,392,479 was paid to the Members in respect of mileage claims.

“However, no explanation was provided as to why three Members were paid twice or thrice for the same date of travel,” she said.

She said examination of payments for claims by Members for mileage and domestic subsistence facilitation revealed instances where some Members were paid domestic subsistence facilitation and mileage claims on days when they were outside the country and already receiving foreign subsistence allowances.

“The irregular payments had not been recovered by the time of the audit in December, 2020.

“In the circumstances, the propriety of the expenditure of Sh11,392,479 and Sh5,219,358 included under domestic travel and subsistence in the statement of receipts and payments for the year ended 30 June, 2020 could not be determined,” Ms Gathungu said.

Source: BD.

June 22, 2021
Okiya Omtatah Wins As Court Stops Re-advertisement Of The Auditor General’s Post

The Employment and Labour Relations Court has suspended the recruitment for an auditor General after the outspoken activist Okiya Omtatah filed a petition against the selecting panel.

Auditor General position fell vacant last year in August after then Auditor General Edward Ouko’s term came to an end. Public Service Commission had stated that the government had to re-advertise for the vacancy after the selection panel failed to find a suitable candidate to fill the retired Ouko’s vacancy.

According to activist Okiya Omtatah, all of the three candidates met all the requirements. Omtatah had sued the panel stating that it was unlawful to turn down the selection of the three candidates.

“The decision to re-advertise the vacancy in the position of Auditor-General is unconstitutional and, therefore, invalid, null and void,” he said.

In today’s ruling, Justice Stephen Radido temporarily halted re-advertisement for the post. The vacancy had been announced in 2019 December.

“Pending the inter-partes hearing and determination of this case, the court at this moment issues an interim order prohibiting the sued parties and their agents. Howsoever acting, from giving effect to the advert, howsoever published, re-advertising the vacancy in the office of the Auditor-General and asking qualified and interested persons to apply,” Justice Stephen Radido said.

January 17, 2020
Exposed: 19 Secret Looting Accounts Linked To Embu’s Embattled Governor Martin Wambora

Embu county assembly has been trying to impeach Governor Martin Wambora since the first month he was elected in the Office. The governor who has nine-lives like a stray cat has been, fortunately for him, surviving all impeachment attempts against his reign.

However, Embu county Public Accounts and Investment Committee has released damning details after the audit report by the retired Auditor General exposed that Wambora and his cronies have been operating 19 main bank accounts with a total balance of Sh518,995,353 and 56 Danish International Development Agency Health facilities accounts with a total balance of Sh1,441,558 all totalling to Sh521,436,911.

Wambora’s key allies have been linked to suspicious 19 secret bank accounts that have been used to loot millions.

According to the committee’s chairman Phillip Nzangi report, accounts were opened and operated against Section 82 of the public finance management regulations (county government) 2015 Act. Nzangi who is the Makima MCA report reveals existence of two revenue accounts at the Runyenjes Level Four Hospital, being operated by strangers since the said signatories had been moved to other departments and/or counties and no changes had been made against the signatories.

According to the report, Wambora’s signatories in-law made unexplained and unsupported withdrawals from the accounts amounting to Sh34,751,498 in 2017 and another Sh11,508,452 early this year. It has been established that George Muthinji, the hospital administrator was also the banking agent for the two bank accounts whose only duty was to access the bank statements.

Other suspicious accounts are Runyenjes District Hospital accounts numbers; 0114148462201 and 0114148462200 balances show that two accounts had credit balances of Sh554,289 and Sh15,814,210 as at July 24 2019. The money was not declared to the county government.

The report implicated former health accountant Ruth Ndirangu, former medical superintendent Anthony Mulu, former county director of finance Edwin Rugendo, former director for health administration Anthony Mugendi and former health accountant Musalia Eric as main culprits—all signatories to the two accounts— Wambora is using in the scam to fleece Embu.

Another fraud unearthed was when Wambora and his cronies —county executive—transferred Sh25,700,000 from Embu county treasury to Embu Youth Trust Fund account (0190264375530) at Equity Bank Embu branch comprising of Sh15,800,000 and Sh9,900,000 transferred on November 9, 2016, and April 30, 2017, respectively.

It has also emerged that Wambora cleared Sh170, 517,267 funds transfer to Embu county education support fund account number 01141408639900 held at Embu branch in respect to scholarship and bursaries. According to Edward Ouko’s audit, the said account had an unspent balance of Sh10,821,866.

The fleecing did not end there, Wambora and his alleged accomplices fraudulently procured tree seedlings worth a whopping Sh17.5 million in the 2016/2017 financial year. Kenya Forest Services on March 13, 2017, approved the deal budgeted at Sh14,499,856. However, Wambora approved over-expenditure of Sh3,000,144.

This is the governor who is expected to improve the lives of fellow Kenyans in Embu. The learned leaders the new constitution tapped. While Kenya is still fighting illiteracy 56 years after independence, 47Million ‘fools’ have elected learned cartels that are fleecing the coffers to their deathbeds. Who will save this country?

December 12, 2019
Kisii County Can’t Account For Sh1.2 Billion Pending Bills

Former Auditor general Edward Ouko’s report for the 2017/18 financial year that ended in June has revealed that James Ongwae led Kisii County can’t account for pending bills worth Ksh1.26 billion.

The Audit, also reveals that Kisii county used Sh255 million own-generated revenue without banking nor supporting documents on how the were utilized.

According to Dr. Ouko’s audit, Kisii County did not keep cash books for the maternal healthcare, fuel levy and national agricultural and rural inclusive growth project accounts.

Auditor General’s report pokes holes in how the County clear payments of imprests that some officers applied on behalf of others. Also, Kisii County didn’t explain as to why the officers who are recorded in IFMIS recieved their pays in turns through their colleagues.

According to the law, under section 102 of the public procurement and Asset Disposal Act, 2015, each county is supposed to advertise tenders on their websites but James Ongwae led County procured goods worth Sh25 million through restricted tendering that wasn’t advertised.

The Auditor-General also pointed out that the procurement and disposal plan amount exceeded the budgeted amount by Sh696 million, which breached section 53(2) of the procurement Act, 2015.

Kisii County also used Sh450 million to buy Wireless Access point corporate that was charged under construction of roads line items, which was not in the County budget.

Another loot was detected when Kisii county failed to account for Sh9 million revenue expect to have been collected in the form of coffee and tea cess in the 2017/2018 financial. There are no records to prove that the county colected even a penny.

The land register in LAIFOMS indicated arrears in property rates amounting to Sh112.5 million as of June 30, 2018. The amount decreased from Sh279 million reported in the 2016/2017 financial year.

According to their records, Kisii county collected Sh2.2 million last year leaving Sh164 million unaccounted for in the whole financial year.

Auditor General also states that Kisii County, dispite having a 47 percent employees salary bills against the set 35 percent, they don’t have a Public Service Board, Human Capital Plan nor authorized staff establishment in place as the law states.

November 3, 2019
NSSF Lost Sh9Million In The ARM Recievership Deal

Early this month, this site published a story that Daveks NCC tycoon owner had bought the debt ridden Athi River Mining cement plant.

And today, according to an audit report by the Auditor General, Pensioners lost Sh9 million for the 2.9 million shares that the National Social Security Fund (NSSF) bought in now auctioned Athi River Mining Cement.

In the NSSF records seen by the OAG, the fund has passed off the now worthless shares worth sh9 millon and the records hidden from perusal books.

The debt ridden ARM Cement was placed under a 12-month receivership on August 17, 2018 before being sold of by PwC after they failed to repay their debts.

“Given that the ARM Cement had a debt of $190 million but sale of Kenya subsidiary yielded $50 million and Tanzania $116 million — and other assets like Rwanda are not significant — the sale price is insufficient to pay all the creditors and shareholders,” Mr George Weru, one of the administrators from PriceWaterhouseCoopers (PwC) said.

The auction of ARM has also seen British-owned CDC company lose Sh14 billion after their 42 percent stake in ARM that they acquired in April 2016 for were rendered worthless.

Pradeep Paunrana, the owner of now NCC-owned ARM has fallen short of his sh10billion family’s empire.

NSSF has also lost Sh534 million Chase Bank and Sh132 million Imperial Bank bonds whose recovery is unlikely despite the provisions made for them for the last two years.

“The bonds were invested between 28 September 2015 and 6 October 2015 and were to mature between February 2022 and September 2022. The two banks were put under statutory management by CBK before maturity of the bonds. Consequently, it is not clear if and when the money invested in corporate bonds totalling Sh666.9 million will be recovered” the Auditor General said.

The Auditor General also revealed NSSF still is holding onto fixed deposit of up to Sh329.5 million lost. The fund lost Sh170 million in Imperial Bank and Chase Bank (Sh259.5 million).

Earlier this month, NSSF had declared their Sh220Billion investment in Nairobi and Mombasa based properties alone, a move that prompted the office of Auditor General to scruitnize the funds books.

October 29, 2019
Counties Repaid Sh38Bn To Ghost Medical Equipment Suppliers

Auditor General report has revealed that Counties have been repaying ghost suppliers of the Health ministry’s leased Sh38 billion medical equipment four years.

Counties are caughing out billions of shillings repaying not only ghost suppliers but also crippling county taxpayers by forcefully buying equipments without any recorded evidence of their benefits.

County Health facilities are more sick than the real patients they have to cure and some of the expensive machines that counties are repaying are gathering dust in most of the hospitals.

Auditor-General’s report indicate that the suppliers of the MES the Ministry of Health leased to counties have never been paid yet the records from the counties indicate that the money had been deducted from County Allocations.

Each county pays sh200 million each year, initially the counties were paying Sh95 million.

So for 47 counties, tax payers fork out Sh9.4 billion each year, up from the initial Sh4.5 billion since 2015, when the programme was started. Who exactly is eating these funds? Why is embattled MoH mute and playing numb as yhwy always do?

According to the government, the modern equipment were meant to bring specialised treatment of cancer, diabetes and other serious illnesses closer to the people. The joke remains on people as, take for instance, cancer patients are all referred to KNH where a good number die while waiting on the long list that need to get the drugs and undergo chemo.

Kidney dialysis machines, X-ray and theatre equipment, and intensive care units were also included in the Managed Equipment Scheme (MES) package.

County Governments through the Council of Governors have been complaining that the MoH never involved them in this expensive stagnant project. Since Health is a devolved function Counties are left caughing out funds to keep such half-guessed projects crawling.

This report in a serious country can land couple of cartels behind bars, unfortunately, we are in a country where corruption is celebrated with baloons, fireworks, ceremonial positions, development only recorded on blueprints, national prayers that look more like a face-picture of National preyers… People who are supposed to keep wananchi Healthy are the very same cartels that directly looting and making them more sick in pockets.

October 17, 2019
Retired Commissioner Isiah Osugo In Trouble Over Sh1.8B Theft At The Prison

Auditor General Edward Ouko has exposed sh 1.8billion scam by Kenya Prisons department.

Auditor General’s report exposes how Kenya Prisons paid phoney suppliers, made double payments for goods and services, procured fake bulletproof vests and jackets.

Last month, EACC unearthed attempts to steal Sh4.8 billion through fictitious security contracts by top prison officials and the Matiangi led Interior ministry.

This questionable payouts were dispatched during the tenure of Isaiah Osugo, The now retired Commissioner General of Kenya Prisons.

Osugo has been holding the position for more than a decade.

According to Ouko’s report,304.4 million paid at Prison headquarters ,on behalf of various prisons, for food rations could not be traced or accounted for.

Ouko report has also exposed two suppliers who were paid Sh2.4 million by prison headquarters, on behalf of Kibos Medium Prison did not deliver the food.

“Indications are that the payments were irregularly made to recipients who did not supply food to the prison,” reads part of Ouko’s report.

Auditor General’s report revealed that Osugo swindled Sh12.4 million using forged pending bills for Kisumu Main Prison.

Ouko also discovered cases of double payments totalling Sh22.5 million in connection with

According to auditor general’s report, Usugo led department double paid non existing suppliers of Naivasha, Eldoret and Kakamega Prisons and Shikusa Borstal.

“However, verification at the prisons revealed massive irregularities as the purported suppliers had never been contracted to supply food and there were no deliveries or receipts at the three prisons,” reads part of the Auditors report.

Osugo and other senior prison bosses have been clearing multimillion fake pending bills.

The report reveals that bills totalling to 288.6million reflected in the headquarters’ records could not be traced to the records of the prisons where food rations were allegedly delivered.

Osugo also left cooked pending bill records worth 18.6 million for food rations. Auditor general’s report indicates the had already been paid before.

Usugo led Prisons department is also on spot for procuring 300 substandard bulletproof and 300 bulletproof vests for Sh22.2 million and Sh20.9 million respectively.

“Audit inspection carried out revealed that the body armour received do not have ballistic panels and cannot be used to protect staff against rifle fire, ammunition, knife stabs and sharp or pointed instruments,” reads part of Ouko’s report.

In mid March this year, EACC unearthed a Sh4.8 billion scandal executed via fictitious security contracts.

The Audit also reveals that the Osugo led department double paid bills worth Sh2 million to the officer-in-charge of Naivasha Maximum Prison for construction of staff houses.

Prisons also used 128.6 million to pay firewood suppliers countrywide without proof of delivery notes.

Ouko report also raises a red flag on the award of a tender for construction of a perimeter wall at the Eldoret Prisons for 24.8 million.

Auditor generals reveals that prisoners were engaged to construct the same wall despite Osugo dispatching additional Sh7.5 million on the project.

Osugo’s department also oversaw the loss of 1.7 million on a tender for the installation of CCTV surveillance cameras at the Naivasha GK prison.

Prisons headquarters paid 12 million for 190 five megapixels cameras, but the audit report revealed that only 158 cameras were accounted.

“The audit further established that 52 cameras costing Sh 4.5 million installed at the reception and hospital blocks are defective and, therefore, not functioning,” reads part of Ouko’s Audit report.

The audit report also revealed that the contractor supplied eight Power Distribution Boards instead of 30, resulting in a loss of 22 others costing Sh 550,000.

July 3, 2019
Auditor General Edward Ouko Reveals How Corrupt State Corporations Looted 823.7 Billions.

Auditor General Edward Ouko, has once again unearthed a multimillion State corporations fraud.

According to Auditor general, the government risks losing Sh823.7 billion worth of outstanding loans advanced to 72 State corporations.

From the documents seen by this site, Sh47.52 billion of these loans are dormant and have fallen due on various dates over the years.

Auditor-General Edward Ouko’s Annual National Treasury report on government investment and public enterprises
{outstanding loans} reveals that most of the loans were issued out by the National Treasury without the required procedure and documentation.

“Failure to redeem the loans precipitate a high likelihood of defaulting and eventual loss of public funds because of continued write-offs of bad debts,” reads part of Auditor general’s report.

The National Assembly has said that the management of the state corporations did not forward over their respective annual work plans, cashbooks, ledgers, quarterly reports, monitoring and evaluation reports for the loans.

And just like any other State masterminded fraud, the loans did not have documentation determining the beneficiaries, terms of the loans and the authorisation of the disbursements.

“This determination appears to be outside the department’s control, thus the department implements decisions that are made elsewhere. This is exhibited by the continued growth of the outstanding loans,” reads part of Ouko’s report.

The National Assembly’s Public Accounts Committee (PAC) chaired by Ugunja MP Opiyo Wandayi is set to review Auditor Generals report and table their recommendations to the House.

Another revelation in Ouko’s report is how the already defaulting institutions continue to receive funding from The National Treasury.

This casts doubts on the backdoor criteria is being used by the Treasury to advance new loans to the Institutions.

The heads of the 72 States have hidden their budgets, annual plans and, are also sitting on assessment, evaluation and performance reports of the loaning portfolios.

This is how public funds are swindled by corrupt public servants.

According to Ouko, without those budgets, annual plans and, assessment, evaluation and performance reports it’s difficult to determine whether public funds had been used properly.

Here are some of the notorious parastatals with dormant loans in billions of shillings:

Rural Electrification Authority 13.65 Million, Coast Water Service Board 7 million, Northern Water Services Board 5.39 million and Tanathi Water Services Board has Sh4.4 million.

Also on the list of shame is Lake Victoria South Water Services Board with 3 million, Lake Victoria North Water Services Board 2.8million, the collapsing Mumias Sugar Company has 2.5 Billion, the National Water Conservation and Pipeline Corporation 2.46million.

According Auditor general’s report, SONY Sugar Company limited books indicated that they have a loan of Sh770.28 million but Treasury says the have outstanding loans of Sh199.02 million.

The already crippled Mumias Sugar Company limited has Sh3 billion as per its financial records but Treasury records have Sh2.5 billion.

Also, Agro Chemicals owes the public Sh9.07 billion but National Treasury records only captured Sh1.11 billion.

Tanathi Water Services Board has Sh5.20 billion in debt but Treasury records have 5.05 billion.

Another swindle according to Ouko’s report is where Moi University owes the coffers 257.77 million but the Treasury has only listed 31.25 million.

Kenya Meat Commission has 300million but Treasury has 90.24 million in its records.

Utalii College has pending debts of 140.13 million but Treasury lists zero balance.

Faulu Kenya owes the public 176.68 million but Treasury records shows 141.31 million only.

IDB Capital limited alleges to have zero balance but Treasury records indicate they still owe the public 1.56 billion.

Coffee Board of Kenya owes the public 976 million.

Pyrethrum Board of Kenya 863 million, Kenya Industrial Estates 758 million.

Funny enough, Co-operative Bank of Kenya also owes the government Sh476 million despite making billions of shillings in profit every year.

These agencies managements do not pay the loans intentionally so that the government ends up writing off their debts.

This is how government is splashing public money on the tables of greedy parastatals heads.

July 2, 2019
Auditor General Edward Ouko Exposes County Government’s Pending Bills Fraud

Auditor General investigations have revealed that county governments have faked debts exceeding Ksh.35 billion.

This financial year, all the 47 county governments owe their individual suppliers up to Ksh.108 billion.

Auditor general records indicate that this is the highest amount of pending bills in the history of in the devolved governance.

The Presidential directive during Madaraka day set a deadline of settling all pending bills,10 days before end of this financial year.

Auditor General Edward Ouko told this writer that there are critical integrity and accounting queries raised on the directive by President Kenyatta.

The Auditor General okayed the payment of Sh 1.7 billion bills but rejected the settling of Ksh.11B bills that had been forwarded by Sonko led Nairobi county.

Governor Nanok, whose County, Turkana, has been the second largest recipient of devolved funds after Nairobi has seen their faked up sh 2 Billion pending bills rejected by Auditor General.

February this year, Waititu led Kiambu County presented a cooked up pending bills quotation of sh 3.3 billion.

Auditor General’s report indicate that Governor Ferdinand Waititu County is only authorized to clear bills worth Ksh.1.8B.

According to the Auditor Edward Ouko, Kisumu County had forwarded that they have Ksh.2.4 billion pending bills, with bills worth Ksh.683 million have been declared fake.

Ali Hassan Joho, Mombasa county boss had presented Ksh.5.3B as his debt. But Ouko’s detectives declined bills worth Ksh 2.8 billion.

Auditor general has also stopped the clearing of Nakuru’s 2 Billion non explained pending Bills.

In West Pokot County, Prof. John Lonyangapuo has pending bills worth Ksh.1.7 billion declined by Auditor general. His County was cleared to receive only Ksh 483 million.

Homa Bay County has only been cleared to receive Ksh.40 million from their pending bills quotation of Ksh1.6B.

Senate Public Accounts and Investments Committee, PAIC, chair Moses Kajwang says the committee is will meet Auditor General next week to get briefed more light on the verification of pending bills, before tabling a detailed report before them in the August House.

This payment of the pending bills has been robing the country billions.

It’s high time now to our Judiciary to take serious investigations that Auditor general have given the country.

All these faked pending bills claimants need to be prosecuted with the presented evidence and jailed.

These claimants and their crony accomplices in air supplies have defrauded the taxpayers billions of shillings for ages, the State needs to have them spend the rest of their miserable life behind bars.

June 22, 2019