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Tag: John Ngumi

  • The Deal That Broke Telkom: How John Ngumi Pocketed Sh415 Million and Landed in Investigators’ Crosshairs

    The Deal That Broke Telkom: How John Ngumi Pocketed Sh415 Million and Landed in Investigators’ Crosshairs

    Telkom Kenya is dying. Not quietly, not gracefully, but in the loud, humiliating fashion of an institution bled by institutional failure, political manipulation, and a sequence of ownership disasters that have, one by one, stripped it of subscribers, infrastructure, capital, and hope.

    By December 2025, its mobile subscriber base had collapsed to approximately 744,500 down from 1.34 million just two years earlier, a contraction of nearly half that left it last among Kenya’s operators, overtaken even by Equitel and Jamii Telecommunications, niche players that nobody was tracking as competitive threats. Its network quality score of 55 percent in the Communications Authority’s 2023/24 drive tests was not merely a poor grade. It was 25 percentage points below the mandatory regulatory threshold, while Safaricom hit 86 percent and Airtel cleared the bar at exactly 80.

    Employees, many of them stuck in the same roles for a decade, have described themselves to their union as ‘spectators in their own careers.’ The company that once anchored Kenya’s digital connectivity ambitions operating undersea cables, data centres, and government security infrastructure has been reduced to a rump operation fighting for relevance in a market that has moved on without it.

    Into this wreckage, step back to August 2022. The National Treasury, in the closing days of the Kenyatta administration, wired Sh6.09 billion to a Mauritius SPV called Jamhuri Holdings Limited. The official justification was national security. The practical result was that a private equity firm called Helios Investment Partners collected its exit cheque, four days before a general election, without parliamentary approval, without full Communications Authority sign-off, and in circumstances that the Ethics and Anti-Corruption Commission would later characterise as potential economic crimes warranting prosecution of nine individuals.

    One of those nine was John Ngumi.

    He had collected Sh415 million $3.07 million from the seller’s Mauritius vehicle for advising the seller on how to extract itself from the deal. He was simultaneously a strategic adviser to Helios for Kenya and Africa, a director of the Communications Authority of Kenya whose approval the deal allegedly needed and never properly obtained, a recently departed chairman of Kenya Pipeline Company, the incoming chairman of Safaricom Telkom’s dominant competitor and the man whose relationships inside the Kenyatta government machinery were worth, by Helios’s apparent calculation, more than what Jamhuri Holdings itself netted from the transaction.

    Four years later, with Telkom on its knees, Helios in a London arbitration fighting to recover what Kenya’s new administration rescinded, and EACC still sniffing around an investigative file that two DPP declinations have not formally closed, John Ngumi filed a petition at the High Court on June 11, 2026. He wants the investigation terminated. Permanently. By court order. He wants a permanent injunction. He wants damages. He wants judicial immunity from the consequences of a deal he brokered, collected from, and walked away from while the institution at the centre of that deal slowly disintegrates.

    Ngumi was the single largest individual beneficiary of a transaction that left its subject Telkom Kenya unable to pay its tower bills, unable to retain its subscribers, and unable to find a strategic investor willing to rescue it.

    THE TRANSACTION: A TIMELINE OF MANUFACTURED URGENCY

    The sequencing of the Telkom buyback has never been adequately interrogated as a timeline of political orchestration rather than genuine national security management. Helios communicated its intention to exit Telkom Kenya as early as July 2021, invoking a ‘put option’ embedded in the original shareholder agreement. That is not urgency. That is a contractual mechanism that had been anticipated since Helios entered the shareholding. The government had, by any reasonable measure, over a year to plan, budget, seek parliamentary approval, obtain all necessary regulatory clearances, and execute an orderly transaction.

    Instead, the National Security Council approved the proposal on April 1, 2022. On the same day April 1, 2022 John Ngumi signed his advisory agreement with Jamhuri Holdings. This is not a coincidence that has been explained. Nobody has publicly accounted for how Ngumi knew, with enough advance notice to execute a formal advisory agreement on the same morning, that the NSC was convening to approve the deal.

    His prior role as Helios strategic adviser for Kenya and Africa is the obvious connecting tissue, but it is also precisely the connection that sharpens the conflict-of-interest concern: a man advising the seller who had been advising the seller’s interests in Kenya before the exit process formally began.

    The Treasury then invoked Article 223 of the Constitution  the emergency expenditure provision to disburse Sh6.09 billion on August 5, 2022, without prior parliamentary approval.

    The deal had been in negotiation for over a year. EACC’s own findings, published in its third-quarter 2023 gazette notice, were explicit: ‘the acquisition did not meet the threshold as provided in Regulations 40(3) and 4(a) of the Public Finance Management (National Government) Regulations 2015 since the transaction was not unforeseen and unavoidable.’ This is the heart of what EACC found. The emergency provision was invoked for a deal that was not an emergency. Parliament was later notified, but notification is not approval, and approval was what the regulations required.

    The Communications Authority finding is equally damning. EACC’s November 2023 report stated that the Communications Authority ‘did not grant approval for the acquisition of 60 per cent of Telkom Limited by the Government of Kenya in the transaction under inquiry since part of the conditions given by the Authority were not met.’

    The same Communications Authority on whose inaugural board Ngumi had sat. The same regulator whose frameworks he had helped construct. The same institution within which he had cultivated relationships over decades of investment banking work in the telecommunications sector.

    THE FEE THAT DEFIES EXPLANATION

    John Ngumi appeared before the joint sitting of the National Assembly’s Finance and National Planning Committee and the Communication, Innovation and Information Committee on April 19, 2023. What followed was a parliamentary grilling that, for sheer audacity of response, has few parallels in the documented record of Kenyan corporate accountability hearings.

    Ngumi confirmed he had received $3.07 million Sh415 million at the then-current exchange rate of Sh135.20 over the five-month period between his April 1 signing and September 2022. He acknowledged it made him the single largest individual beneficiary of the Sh6.09 billion transaction, exceeding what Jamhuri Holdings itself received and more than seven times what the lawyers Anjarwalla and Company Advocates were paid (Sh54 million). His explanation for this asymmetry was not technical. It was not contractual. It was personal. ‘I was paid the money because I was the best in the business,’ he told the committee. ‘They valued the advice I gave them and I am proud to say I convinced them to sell their 60 per cent shareholding to the government at $1 million.’ He added that he could have charged $10 million, implying the Sh415 million should be viewed as a discount.

    Finance Committee chair Molo MP Kimani Kuria said he could not find a plausible explanation to justify the payment. Critically, Ngumi’s identity as a beneficiary had only come to light because Helios Chief Finance Officer Paul Cunningham had disclosed it to the committee Ngumi had not been forthcoming about his involvement. He appeared, as the MPs observed, late in the documented process. His name was not in the initial transaction records that were submitted to Parliament. He emerged as a figure in the deal only when Helios’s own representatives mentioned what they had paid him.

    The tax payment that confirmed the problem. Facing sustained parliamentary pressure, Ngumi announced he would voluntarily pay 30 percent tax equivalent to Sh111.9 million on his advisory fee, framing it as good faith compliance. ‘I made a commitment to Parliament that I would pay within one week and that is what I have done,’ he told Business Daily.

    But the political optics were already toxic.

    Paying tax under parliamentary scrutiny is not the same as having earned income that warranted no scrutiny. The payment itself implicitly acknowledged that the money had been received in circumstances that required justification, not just revenue declarations.

    HOW THE DEAL BROKE THE COMPANY

    Telkom subscriber holds sim card kit.

    The most devastating indictment of the Telkom transaction is not what happened to the people who brokered it. It is what happened to the company at the centre of it.

    When the Ruto administration took office in October 2022 and almost immediately rescinded the Kenyatta government’s nationalisation, citing ‘governance challenges,’ it did not merely undo a transaction. It created an ownership vacuum at a moment when Telkom Kenya needed urgent capital investment and strategic direction. The company was already in debt. The tower sale-and-leaseback arrangement with American Tower Corporation, executed in 2018, had swapped long-term infrastructure security for short-term liquidity a deal that would return to haunt it with devastating force.

    In February 2023, American Tower Corporation began switching off Telkom towers over unpaid leasing fees. By August 2023, ATC had disconnected 896 sites over a debt that had grown to Sh4 billion, later ballooning to Sh7.1 billion by October 2023. The ICT Cabinet Secretary Eliud Owalo was blunt before Parliament: ‘We are in a situation where Telkom is unable to pay.’

    The network collapse that followed was catastrophic. Telkom’s quality-of-service score fell to 55 percent against a mandatory 80 percent threshold. Customers fled in their hundreds of thousands to Safaricom and Airtel. The company that had once boasted 3.4 million subscribers was reduced to under 750,000 by late 2025.

    American Tower disconnected 896 Telkom sites. The debt hit Sh7.1 billion. The coverage collapsed. 800,000 subscribers left within three months. This is the inheritance of the deal John Ngumi brokered.

    The government’s response selecting UAE-based Infrastructure Corporation of Africa as the new majority shareholder in October 2023 solved nothing in practice.

    Nearly three years after that announcement, the ICA transition remains in an indeterminate state. Employees’ union COWU-K has publicly declared there is ‘no lifeline’ for Telkom Kenya. Workers are demoralized. Promotions, job reclassifications, and skills development have stalled. By December 2025, Telkom had fallen to last place in Kenya’s mobile market, a rump operator fighting for relevance in a sector it helped pioneer.

    Meanwhile, Jamhuri Holdings the Mauritius vehicle that collected Sh6.09 billion in August 2022 is now suing Kenya before the London Court of International Arbitration.

    The government’s revoking of the nationalisation and the pivot to ICA apparently breached the original transaction agreement, which specified that disputes be resolved under LCIA rules.

    The National Treasury has contracted G&A Advocates for Sh358 million to defend Kenya’s position in those proceedings a further bill to taxpayers, on top of the original Sh6.09 billion, arising directly from a transaction that Ngumi facilitated and from which he extracted the largest individual fee of any participant.

    THE PROSECUTION RECOMMENDATION AND WHAT IT DID NOT END

    EACC’s third-quarter 2023 gazette report recommended that the DPP charge nine individuals with counts including conspiracy to commit economic crime, abuse of office, and wilful failure to comply with the law.

    The list included former Treasury Cabinet Secretary Ukur Yatani, Controller of Budget Margaret Nyakang’o, Telkom CEO Mugo Kibati, and the board chair, chief operating officer, chief strategy officer, and chief finance officer of Telkom Kenya. John Ngumi, as transaction adviser, was also on the list.

    The DPP, in two separate communications on April 7, 2025 and confirmed on July 4, 2025 declined to prosecute. Prosecutor Joseph Riungu’s letter of July 4, 2025 reaffirmed the first direction, finding insufficient evidence to sustain the proposed charges.

    The ODPP concluded that the Cabinet Secretary had constitutional authority to invoke Article 223, that the Controller of Budget had ultimately sanctioned withdrawals, and that Parliament was later notified. On Ngumi specifically, the ODPP noted that he had acted under a separate advisory arrangement, declared taxes on his fees, and was not a party to the government’s share purchase agreement.

    Here is what the DPP said.

    Here is what it did not say. It did not say the transaction was clean. It did not say Ngumi’s advisory arrangement was conflict-free. It did not say the Communications Authority approval question was resolved. It did not say there was no basis for civil recovery proceedings.

    And critically, in a point that the Business Daily’s June 16, 2026 reconstruction of the saga noted as significant: it said ‘insufficient evidence to sustain proposed charges’ not that no wrong was committed, but that the evidentiary threshold for prosecution had not been met at that moment, with that file, as it then stood.

    EACC disagreed with the first direction and sought reconsideration, prompting the DPP to review the file a second time. The commission’s own assessment remained that there were questions worth pursuing. That is why the file remained open. That is why Ngumi filed his June 11, 2026 petition. A permanently closed DPP file still leaves EACC’s civil enforcement powers alive. The commission can pursue civil asset recovery.

    It can seek unexplained wealth orders against assets bought using the Mauritius-routed advisory proceeds. It can make mutual legal assistance requests to Mauritius where Jamhuri Holdings was registered and through which the $3.07 million payment was presumably routed to reconstruct the full transaction trail. It can, if new material surfaces, refer the matter back to a future DPP with an enhanced file.

    THE INSTITUTIONAL WEB: A MAP OF EVERY DOOR THAT MATTERS

    The reason the conflict-of-interest concern in this transaction is not a technicality but a structural integrity question is what Ngumi’s career map reveals about how Kenya’s strategic decision-making is colonised by a small class of well-connected intermediaries.

    Ngumi served as an inaugural director of the Communications Commission of Kenya now the Communications Authority the regulator that oversees the very telecommunications sector at the centre of this transaction and whose approval was required for the acquisition.

    He was the non-executive chairman of Safaricom, Telkom’s principal competitor and the company that stood to benefit commercially from any weakening of Telkom’s market position. He had been chairman of Kenya Pipeline Company and of ICDC, which oversaw KPA, KPC, and Kenya Railways the entire logistics backbone of the state infrastructure portfolio.

    He had chaired Konza Technopolis Development Authority the government’s technology city ambition, which depended on reliable national connectivity infrastructure of the type Telkom manages. He had been a Kenya Airways non-executive director. He had been Helios’s strategic adviser for Kenya and Africa before pivoting to become the Helios exit adviser through Jamhuri Holdings.

    The question that Parliament struggled to articulate but kept returning to is this: what was Ngumi selling for $3.07 million? Not financial modelling the transaction had a put option mechanism that required no novel valuation work. Not legal structuring that was Anjarwalla’s mandate, for Sh54 million.

    Not commercial negotiation the price was $1 in nominal equity terms, with the real payment being the reimbursement of Helios’s shareholder loans to Telkom. What remained, after stripping away the work that professionals with standard mandates were already performing, was access. Access to the NSC deliberations. Access to Treasury decision-makers. Access to the Communications Authority. Access to the political principals who could execute a Sh6 billion transaction in 26 minutes on a Friday, in August, four days before a general election, over the objections of the Controller of Budget.

    That access was built entirely on publicly funded institutional positions accumulated over decades. The Sh415 million was the private rent charged for public access. That is the structural problem that two DPP declinations do not resolve and that an open EACC file preserves the right to examine.

    THE PETITION: JUDICIAL IMMUNITY DRESSED AS HUMAN RIGHTS

    On June 11, 2026, Ngumi’s lawyers filed a petition in the High Court’s Human Rights Division. The petition seeks declarations that EACC’s continued investigative process is unconstitutional, unlawful, and procedurally unfair. It seeks an order compelling EACC to terminate all investigations, inquiries, watchlists, alerts, and enforcement actions.

    It seeks a permanent injunction barring the commission from ever reopening the matter or undertaking any future investigations, summons, surveillance activities, or enforcement measures related to the Telkom deal. It seeks damages general, aggravated, and exemplary for reputational damage and emotional distress.

    The court declined to certify the petition as urgent. It directed that it proceed through the ordinary hearing process. This is significant. Urgency would have produced interim orders immediately; the ordinary process gives EACC time and standing to respond substantively. It means the petition will be tested on its merits rather than rushed through on the applicant’s preferred timeline.

    The legal argument Ngumi is advancing that the DPP’s closure direction conclusively terminated all investigative authority is a novel and contestable proposition. Kenya’s anti-graft architecture does not work this way. The EACC Act and the Proceeds of Crime and Anti-Money Laundering Act create parallel enforcement tracks. Civil asset recovery proceedings are not dependent on prior criminal prosecution. The DPP and EACC have distinct mandates under the Constitution. A direction to EACC from the DPP is not a court order. And as the DPP’s own letters make clear, the directions were addressed to EACC’s inquiry file — not to the commission’s broader civil enforcement and asset-tracing powers.

    The reputational damage argument deserves particular scrutiny. Ngumi’s petition frames continued investigation as a constitutional violation of his dignity and privacy. But the reputational damage to Ngumi did not originate with EACC’s investigation. It originated with the Sh415 million fee, the parliamentary revelation that he was the largest individual beneficiary of a compromised public transaction, the post-hoc tax payment that confirmed the fee had been received without voluntary compliance, and the two board resignations from Safaricom and Kenya Airways that followed the investigation’s intensification. The investigation is the consequence of the reputational problem, not its cause. Seeking to extinguish the investigation to protect a reputation that the underlying conduct already damaged is not a constitutional argument. It is a business calculation.

    The reputational damage to Ngumi did not originate with the EACC investigation. It originated with a Sh415 million fee from a seller’s Mauritius vehicle in a Sh6 billion public transaction conducted without parliamentary approval.

    THE NAIROBI PROPERTIES AND THE COASTAL TRAIL

    The Daily Nation’s May 2023 reporting, sourced to materials within the EACC investigation, contained a detail that subsequent coverage has consistently underweighted: multi-million shilling assets in Nairobi and a beach property on the Coast were identified among acquisitions linked to the advisory proceeds. This is an asset-tracing lead, not a proven allegation. No civil recovery order has been sought or granted. No court has made findings on these properties. But the lead represents precisely the category of inquiry that EACC’s civil enforcement powers are designed to pursue and precisely the category that a permanent judicial closure of the file would prevent from ever being concluded.

    The Mauritius routing of the $3.07 million payment is the architecture that makes full tracing difficult. Jamhuri Holdings was a Mauritius-registered vehicle. Payments from a Mauritius entity to a Kenyan recipient pass through offshore banking infrastructure. Reconstructing the full chain from Treasury disbursement to Jamhuri Holdings to Ngumi’s accounts in whatever form requires a mutual legal assistance request to Mauritius, cooperation between Kenya’s FIU and its Mauritius counterpart, and time.

    Every year that the investigation is delayed is a year in which those financial trails grow colder. Every year that Ngumi maintains the procedural pressure is a year in which the asset reconstruction becomes less traceable. The petition is, among its other functions, a time-buying exercise whose ultimate purpose is to outlast the investigators’ institutional patience.

    THE PATTERN: EUROBOND TO TELKOM

    The Telkom advisory fee is not John Ngumi’s first encounter with investigative interest in his fee structures on major sovereign transactions.

    In 2014, when Kenya executed its $2 billion debut Eurobond the largest debut sovereign bond issue by an African country to that date Ngumi was the lead arranger for Standard Bank Plc and the public spokesperson for the consortium of arranging banks.

    The bond subsequently attracted controversy when opposition figures alleged that proceeds had been misappropriated in transit before reaching Kenya. EACC, in the course of investigating those allegations, identified Ngumi as a person of interest in the inquiry because, as the Standard newspaper reported, ‘many crucial emails during the arranging of the bond were under his name’ and investigators needed to understand how the bond was priced and whether the arrangement fees were justified.

    He was not charged in relation to the Eurobond. He survived that investigation. But the pattern was established even then: a major government transaction in which a well-connected intermediary earned substantial fees; regulatory questions about the process and the pricing; an investigation that produced no prosecution; and a resumption of normal business. The Telkom fee is the pattern on its fourth or fifth iteration larger in absolute terms, more politically exposed in its timing, and more difficult to explain away given the simultaneous conflicts of interest that surrounded it.

    WHAT TELKOM’S RUINS SAY ABOUT THE DEALMAKER

    There is a version of John Ngumi’s career narrative in which he is a pioneer: the Oxford-educated Kenyan who returned from London, co-founded the country’s first indigenous investment bank in Loita Capital Partners, survived its collapse and near-personal bankruptcy in the late 1990s, rebuilt his career from scratch, and went on to advise on transactions worth hundreds of billions of shillings.

    That narrative has genuine elements.

    The Loita story mortgaging his house three times to pay departing staff, spending three years ‘desperately trying to keep my financial head above water’ is a real account of adversity and recovery.

    But Loita Capital Partners collapsed.

    ARM Cement, on whose board Ngumi sat as non-executive director from 2016, went into receivership in August 2018 with approximately $284 million in debt, was subsequently liquidated after asset sales proved unable to cover creditor claims, and remains one of the largest listed company failures in East African corporate history.

    The board governance failures that contributed to ARM’s collapse have never received the forensic examination they deserved. And now Telkom Kenya, the company at the centre of Ngumi’s most lucrative advisory fee, is a rump operator with 744,500 subscribers, a network quality score 25 points below the regulatory threshold, a demoralized workforce, an unresolved ownership structure, an ongoing London arbitration, and no credible path to recovery in sight.

    Three companies. Three governance failures. One dealmaker at or near the centre of each. The pattern is not proof of personal wrongdoing in each case. Companies fail for many reasons. But it is a pattern of institutional proximity to failure that the market’s due-diligence process has thus far treated too gently.

    THE COST TO KENYANS

    The full fiscal tally of the Telkom transaction, when assembled honestly, is extraordinary. The initial buyback: Sh6.09 billion in public funds disbursed without parliamentary approval. John Ngumi’s advisory fee from the seller’s vehicle: Sh415 million.

    The legal fees for the London arbitration defence: Sh358 million contracted to G&A Advocates, with exposure to further costs depending on proceedings.

    The potential liability in the arbitration itself, which involves a claim by Jamhuri Holdings arising from the revocation of the nationalisation: not yet quantified publicly, but described by the High Court as involving ‘potentially substantial financial exposure.’ The ongoing cost of a state-owned telecommunications company now ranked last in Kenya’s mobile market, requiring either a bailout or a write-off. And the uncounted cost of the ownership vacuum that left Telkom without strategic investment for four years while its competitors consolidated and its network decayed.

    John Ngumi’s Sh415 million is not separable from this tally.

    He was the architect of an exit that produced a transaction the incoming government immediately characterised as flawed, that triggered London arbitration, that left the acquired company without governance clarity for years, and that is now the subject of a constitutional petition designed to prevent further examination of how the fee was earned, routed, and deployed. The receipt is Sh415 million. The bill to the public is multiples of that.

    THE COURT, THE FILE, AND THE MAN RUNNING

    The High Court has yet to give directions on the merits of Ngumi’s June 11, 2026 petition. The court’s refusal to certify it as urgent is a small but significant early signal: this matter will proceed at the judiciary’s pace, not the petitioner’s. EACC will have the opportunity to argue that its investigative mandate survives the DPP’s closure directions, that civil enforcement powers are constitutionally distinct from criminal prosecution, and that a permanent injunction against an anti-corruption body’s civil enforcement functions would set a precedent with grave implications for Kenya’s accountability architecture.

    Whatever the court ultimately decides, the petition itself has already accomplished its primary unintended consequence: it has revived every question that three years of legal manoeuvring had caused to fade from public attention. The $3.07 million fee. The April 1 simultaneity of the NSC approval and the advisory agreement.

    The Communications Authority approval that was not obtained. The Article 223 invocation for a non-emergency. The Mauritius routing of the proceeds. The Nairobi assets and coastal property identified by investigators. The two board resignations that followed the investigation’s intensification. And the London arbitration that is now costing taxpayers an additional Sh358 million in legal fees just to defend against the consequences of the deal Ngumi facilitated.

    A man confident in the legitimacy of his Sh415 million fee does not file a petition demanding that the inquiry be judicially extinguished. He files a petition demanding that the inquiry be concluded because a concluded inquiry that finds nothing is an exoneration. A permanently enjoined inquiry is not an exoneration. It is a suppression. The distinction is what separates accountability from impunity, and it is what the High Court will now, whether it intends to or not, be forced to adjudicate.

    Telkom Kenya did not break itself. It was broken by a succession of investors, advisers, and government actors who extracted value from it rather than investing in it, who treated Kenya’s national telecommunications infrastructure as a vehicle for transaction fees and political exits rather than as a strategic asset requiring patient stewardship.

    John Ngumi was the most generously compensated of all those actors in the final Helios exit chapter. He collected his Sh415 million. He resigned his board seats. He filed his court petitions. And he left the company, its employees, its subscribers, and the Kenyan taxpayer to live with the consequences.

    That is the deal. That is the man. That is the record. The lights are still on at the High Court. They are the only ones Ngumi has not yet found a way to switch off.

  • Why John Ngumi Is Running From the EACC and Why the Sh415 Million Payday May Be the Least of His Worries

    Why John Ngumi Is Running From the EACC and Why the Sh415 Million Payday May Be the Least of His Worries

    THE MAN WHO WANTS THE LIGHTS OFF

    On the morning of June 11, 2026, a court filing quietly landed at the High Court’s Human Rights Division in Nairobi that told you everything you needed to know about the current psychological state of one of Kenya’s most celebrated investment bankers.

    John Ngumi Oxford-educated, 35-year career banker, parastatal chairman, presidential confidant, and self-described ‘best in the business’ has petitioned the High Court to declare the Ethics and Anti-Corruption Commission’s ongoing investigation into his role in the Telkom Kenya buyback unconstitutional, unlawful, and oppressive.

    He wants every inquiry terminated.

    Every watchlist lifted. A permanent injunction barring EACC from ever reopening the file. And, for good measure, damages for the emotional distress and reputational injury he says the continued probe has inflicted upon him.

    For a man who once told Parliament he could have charged ten million US dollars for five months of advisory work, the image of John Ngumi seeking constitutional sanctuary from accountability investigators tells its own story.

    Innocent men do not race to court demanding that scrutiny be permanently enjoined. Innocent men testify. They open their books. They welcome the audit trail. They do not spend three years exhausting every procedural avenue available under Kenya’s legal architecture to ensure the investigators never get the chance to look too closely.

    This is the story behind the story the one that mainstream coverage, constrained by advertiser relationships, political proximity, and the natural laziness of reporters who accept official denials as closure, has barely grazed.

    It is the story of what Ngumi’s file actually contains, why the DPP’s earlier pass was not the exoneration it was marketed as, what EACC can still do even without a criminal prosecution, what Ngumi has spent three years trying to prevent investigators from discovering, and why the full picture of this man’s career at the intersection of public power and private capital should alarm every Kenyan who has ever wondered how the country’s strategic assets keep changing hands through layered offshore vehicles with suspiciously well-remunerated intermediaries.

    “I was paid the money because I was the best in the business.” — John Ngumi, to Parliament, April 19, 2023

    THE TRANSACTION THAT STARTED IT ALL

    The facts of the Telkom Kenya buyback are no longer seriously in dispute. In August 2022 specifically on August 5, four days before the general election that would usher out the Kenyatta administration the National Treasury wired Sh6.09 billion to Jamhuri Holdings Limited, a Mauritius-registered special purpose vehicle that served as the investment vehicle for UK-based private equity firm Helios Investment Partners, in exchange for Helios’s 60 percent stake in Telkom Kenya.

    The transaction made Telkom Kenya fully state-owned for the first time since privatisation, in a reversal that had significant national security justifications Telkom controls critical government data infrastructure including data centres, carrier services, landing stations, undersea cables, and meet-me rooms where telecommunications companies connect to each other.

    There was, however, a problem. Several problems.

    The National Treasury had disbursed Sh6.09 billion without parliamentary approval, in apparent violation of Public Finance Management Regulations that require legislative sanction for such expenditures outside certified emergency conditions.

    The Controller of Budget, Margaret Nyakang’o, had explicitly refused to authorise the release of funds, telling Parliament she was overruled.

    The Communications Authority of Kenya, the sector regulator, had not granted final approval for the acquisition because conditions it had set had not been met by Telkom Kenya. No formal Attorney-General opinion was on file. The entire transaction had been executed with an urgency that looked, to any trained eye, less like an unavoidable national security intervention and more like a deal that had to close before a new administration took over and asked questions.

    Into this environment, on April 1, 2022 the very same date, it later emerged, that the National Security Council approved the acquisition John Ngumi signed an advisory agreement with Jamhuri Holdings Limited. He was retained by the seller. Not by the government. Not by the buyer. By Helios, through its Mauritius vehicle, to advise on its exit.

    By the time the transaction concluded in September 2022, Ngumi had received $3.07 million approximately Sh415 million at prevailing exchange rates, making him the single largest individual beneficiary in the entire transaction, surpassing the amount Jamhuri Holdings itself received and dwarfing the Sh54 million paid to the transaction lawyers.

    THE NAIROBI PROPERTIES AND THE COASTAL RETREAT

    What EACC investigators found when they began tracing the movement of Ngumi’s $3.07 million is what keeps the file alive and what Ngumi most urgently needs shut down.

    According to reporting by the Daily Nation citing materials in the EACC investigation, multi-million shilling assets in Nairobi and a beach property on the Coast were among the acquisitions made using the advisory proceeds.

    This is the part of the story that never made it into the parliamentary hearings, where the committee’s questioning was largely restricted to the value-for-money question and the post-facto tax payment.

    Kenya’s EACC has broad civil asset recovery powers under the Ethics and Anti-Corruption Commission Act and the Proceeds of Crime and Anti-Money Laundering Act. A DPP declination on criminal prosecution does not extinguish these powers. The commission can still pursue civil recovery proceedings against assets it believes represent unexplained wealth or proceeds of suspected corrupt conduct. It can issue asset preservation orders.

    It can conduct mutual legal assistance requests to Mauritius where Jamhuri Holdings was domiciled and where the initial payment is likely to have been routed to trace the full chain of transactions from the Treasury disbursement to Ngumi’s accounts. This is precisely what Ngumi’s petition describes as the ‘indefinite and unconcluded investigative process’ that he finds so intolerable.

    The Mauritius routing is particularly significant. Jamhuri Holdings was structured as an offshore SPV a legal architecture that provides layers of opacity between the underlying investors and the actual financial flows. Payments to Ngumi from such a vehicle would have passed through offshore accounts before landing in Kenya.

    Tracing that route requires international cooperation that takes time, political will, and an open investigative file.

    If Ngumi succeeds in getting the High Court to close the file permanently, that international cooperation track dies with it. That is the practical consequence his petition is designed to achieve.

    A DPP declination does not extinguish EACC’s civil recovery powers, its asset-tracing mandate, or its ability to make mutual legal assistance requests to Mauritius.

    THE CONFLICT OF INTEREST ARCHITECTURE NO ONE HAS FULLY MAPPED

    The central integrity question in the Telkom deal is not simply about the size of Ngumi’s fee. It is about the extraordinary concentration of relevant positions he held simultaneously and the questions about whose interests were actually being served when he collected that $3.07 million.

    Ngumi was, at various points in the period surrounding the transaction, the non-executive chairman of Safaricom Kenya’s dominant telecommunications operator and Telkom’s direct competitor in the broadband and enterprise data market; a non-executive director at the Communications Authority of Kenya, the very regulatory body whose approval was required for the acquisition and which EACC found did not give final sign-off because conditions precedent remained unmet; the chairman of Kenya Pipeline Company, a strategic state infrastructure asset; and the chairman of the Industrial and Commercial Development Corporation (ICDC), the state holding vehicle overseeing Kenya Ports Authority, KPC, and Kenya Railways.

    His Eagle Africa Capital Partners was retained by the seller of a strategic national asset, advising on an exit from a company that directly interfaced with government security infrastructure.

    The inaugural directorship at the Communications Authority of Kenya then the Communications Commission of Kenya is the detail that has never received the scrutiny it deserves. Ngumi sat on the regulator’s founding board.

    He helped shape the regulatory frameworks that govern Kenya’s telecommunications market. He built relationships inside the institution that has survived across multiple administrations.

    When the Telkom deal required Communications Authority approval, and when that approval was apparently navigated around or left incomplete, the question of what role Ngumi’s institutional knowledge and relationships may have played in that navigation is precisely the kind of question that an open EACC file preserves the ability to ask. A permanently enjoined investigation cannot ask it.

    There is also the Safaricom dimension. Ngumi was appointed Safaricom’s board chairman on August 1, 2022 the same month the Treasury wired Sh6.09 billion to his client, Helios, to buy a 60 percent stake in Safaricom’s direct competitor.

    He resigned from Safaricom’s board on December 22, 2022, barely five months into the role, in circumstances that insiders described as politically driven by the incoming Ruto administration’s desire to clean house.

    He had also previously served as Helios’s strategic adviser for Kenya and Africa a role that, when combined with his simultaneous advisory mandate to Jamhuri Holdings in the Telkom exit, creates a layered web of competing interests that no major Kenyan institution has been willing to systematically untangle.

    THE COMPANY THAT FAILED AND THE PATTERN THAT PERSISTED

    Before Ngumi became the dealmaker whose name appeared on trillion-shilling transactions, there was an earlier version of the story that his official biography tends to treat as a footnote. Loita Capital Partners, which he co-founded in 1994 as Kenya’s first indigenous investment bank, collapsed into bankruptcy by 1997. Ngumi has spoken openly about the personal financial devastation that followed mortgaging his house three times, borrowing heavily to pay staff, spending three years ‘desperately trying to keep my financial head above water.’ By his own account, he did not fully recover until well into the 2000s.

    The Loita bankruptcy matters not because it is evidence of wrongdoing businesses fail, particularly pioneering ones in frontier markets but because of what it reveals about the pattern of recovery.

    Ngumi’s rehabilitation from insolvency to the highest levels of parastatal governance and deal-making was entirely dependent on his proximity to political power, specifically to President Uhuru Kenyatta.

    It was Kenyatta who appointed him chair of Kenya Pipeline Company in 2015.

    Kenyatta who put him at the head of ICDC. Kenyatta who endorsed his placement on the Communications Authority board. Kenyatta whose political context enabled the Safaricom chairmanship, however briefly. And it was during Kenyatta’s final months in office that the Telkom deal was executed and Ngumi emerged from it Sh415 million richer.

    This is not coincidence. It is a documented pattern of political dependency dressed up as meritocratic achievement. Ngumi’s insistence before Parliament that he was ‘the best in the business’ and that Helios ‘valued the advice’ he gave is technically not falsifiable advisory fees in private transactions are ultimately a matter of agreement between consenting parties. But the question is not whether Helios agreed to pay him.

    The question is why Helios agreed to pay him more than the entire seller’s take from the transaction, more than the lawyers, more than any other single party. The answer that most investigators keep arriving at is not that Ngumi provided advice that no one else in Kenya could have provided.

    It is that Ngumi provided access that no one else could have access to the National Security Council deliberations, access to the Communications Authority, access to the Treasury, access to the political machinery that could execute a Sh6 billion transaction in 26 minutes on a Friday in the dying days of an administration.

    The question is not whether Helios agreed to pay him. The question is why more than the lawyers, more than the entire seller’s take.

    THE EUROBOND GHOST THAT REFUSES TO FADE

    The Telkom file is not the first time EACC has had reason to be interested in John Ngumi. In 2014, when Kenya executed its debut $2 billion Eurobond subsequently enlarged to Sh275 billion through a tap sale Ngumi was a central figure as joint lead arranger for Standard Bank Plc alongside Barclays, JP Morgan, and Qatar National Bank.

    He was also the spokesperson for the consortium of arranging banks.

    The bond became a political flashpoint when then-opposition figures alleged that proceeds had been misappropriated before reaching Kenya, an allegation that was never conclusively resolved in open proceedings.

    Many crucial emails during the bond arrangement were under Ngumi’s name, a fact that the Standard newspaper documented when EACC was seeking to understand how Eurobonds are priced and whether the arrangement fees were commercially justified. Ngumi was made a person of interest in that inquiry too. He survived it. But the pattern a major sovereign transaction, a well-connected intermediary, fees that attract regulatory scrutiny, investigations that produce inconclusive outcomes was being established even then.

    EACC Headquarters, Integrity Center.

    THE ARM CEMENT DIMENSION

    Ngumi’s directorship at ARM Cement, to which he was appointed as non-executive director in 2016, adds another layer to the overall picture.

    ARM Cement went into receivership in August 2018 with a debt burden of approximately $284 million and was subsequently liquidated a collapse that wiped out shareholders and left creditors deeply exposed.

    The company’s implosion remains one of the most significant corporate governance failures in East Africa’s listed company history. The board, of which Ngumi was a member, has never been subjected to the kind of forensic governance examination that the scale of the collapse would ordinarily demand. It is another file that, like the Eurobond, and like the Telkom investigation, appears to have been quietly managed down rather than systematically examined.

    THE DPP DECLINATION AND WHAT IT DID NOT MEAN

    When the Director of Public Prosecutions declined to institute criminal charges following EACC’s prosecution recommendation in late 2023, Ngumi and his legal team immediately framed it as an exoneration. This characterisation is legally illiterate and factually misleading. A DPP declination means one thing: the DPP, at that moment, with the evidence available to it, concluded that the threshold for a criminal prosecution had not been met or that a conviction was insufficiently probable.

    It does not mean the conduct was lawful. It does not mean the money was legitimately earned. It does not mean there was no corruption. It means the DPP made a prosecutorial judgment call one that can be revisited if new evidence emerges, and one that has no bearing whatsoever on EACC’s parallel civil and administrative enforcement powers.

    EACC retains, regardless of the DPP position, the ability to pursue civil asset recovery under the Proceeds of Crime and Anti-Money Laundering Act. It can apply to court for a civil forfeiture order without any prior criminal conviction. It can continue to trace the origins, routing, and deployment of funds received by Ngumi through the Mauritius vehicle.

    It can debarment-recommend Ngumi from participation in public procurement processes. It can make mutual legal assistance requests to the Government of Mauritius and other relevant jurisdictions.

    It can, if new material emerges communications, undisclosed agreements, additional beneficiaries refer the matter back to the DPP with a supplemented file. Every one of these powers is extinguished if the High Court accedes to Ngumi’s petition and permanently closes the file. That is why the petition is significant not just as a legal manoeuvre but as a statement of intent: Ngumi knows the file is not dead, and he is terrified of what a determined investigator with full access to his Mauritius-routed transaction records could still unearth.

    THE REVOLVING DOOR AND THE ACCOUNTABILITY VACUUM

    What makes the Ngumi case systemic rather than merely individual is the pattern it exemplifies. Post-liberalisation Kenya has produced a class of operators who have turned the boundary between public governance and private dealmaking into a personal revenue stream. The architecture is consistent: acquire regulatory and institutional knowledge through publicly appointed roles; deploy that knowledge to inform advisory mandates for private clients seeking to do business with, sell assets to, or extract concessions from the same state institutions; collect fees that bear no rational relationship to the market price of the specific technical advice provided but a very rational relationship to the market price of insider access; and, when scrutiny comes, invoke procedural arguments, political victimhood narratives, and constitutional rights litigation to run out the clock.

    Ngumi’s own career maps this architecture with unusual precision. Communications Authority director knowledge of the regulatory framework governing telecommunications licensing and approvals. Kenya Pipeline Company chairman control over procurement and contract decisions at a strategic energy infrastructure entity.

    ICDC chairman oversight of the state’s largest logistics and infrastructure holdings. Konza Technopolis chairman exposure to Kenya’s technology infrastructure development plans and the commercial opportunities they generate. Safaricom board chairman access to the competitive intelligence, network architecture intelligence, and government relationship structures of East Africa’s dominant telecommunications company. Eagle Africa Capital Partners the private vehicle through which all of this accumulated institutional knowledge is monetised.

    The money that flows into Eagle Africa Capital Partners from clients who need government doors opened, regulatory approvals navigated, or strategic intelligence provided is, in this architecture, not really advisory income. It is the rent charged for access to a network built entirely on publicly funded institutional positions. The Sh415 million Telkom fee is the most visible and documented example of this rent-extraction. It is almost certainly not the only one.

    WHY HE IS REALLY RUNNING

    Ngumi’s petition lists reputational damage and emotional distress as the injuries he has suffered from the continued investigation. The reputational damage argument is particularly instructive. His reputation in Kenya’s investment banking community the reputation that generates future mandates, board appointments, and advisory fees depends on the perception that he is above legal reproach.

    An open EACC file, even without charges, signals to international institutional investors, development finance institutions, and foreign private equity that doing business with Ngumi carries regulatory risk. It dries up the pipeline. It makes future Jamhuri Holdings-type mandates less available. The petition is, at its core, not a human rights action. It is a business protection measure dressed in constitutional clothing.

    But the deeper fear is what an unconstrained investigation might find in the communications trail. Ngumi was retained by Helios on April 1, 2022 the same day the National Security Council approved the acquisition.

    This timing has never been adequately explained.

    Did Ngumi know in advance that the NSC was meeting that day? Did he have any role in structuring the security justification that was used to move the transaction through without parliamentary approval? What do the internal Eagle Africa communications say about the nature of the advice he was providing? What do the WhatsApp threads, the emails, the phone records say about his interactions with Treasury officials, NSC members, and Communications Authority personnel during the critical weeks when a transaction requiring multiple regulatory approvals was being executed with none of them fully in place?

    An EACC with access to Ngumi’s private communications, Eagle Africa’s internal records, and the full Jamhuri Holdings transaction file obtained through a Mauritius mutual legal assistance request could potentially reconstruct, with significant precision, what happened in those five months.

    That reconstruction might show exactly what Ngumi provided for his $3.07 million, and it might show that what he provided was not high-level financial advice but high-level political facilitation. That is the file he wants permanently sealed.

    THE PETITION AS CONFESSION

    Lawyers for accused persons routinely file motions to suppress evidence, challenge jurisdiction, and seek procedural relief. That is the adversarial system working as designed. But there is a category of legal manoeuvre that, by its very nature, functions as an admission of vulnerability rather than an assertion of innocence. Ngumi’s petition belongs to that category.

    A man genuinely confident that the investigation would clear him would not demand its permanent termination. He would demand its conclusion. He would submit to questioning, produce his records, demonstrate that his advisory work was legitimate, and allow the commission to close the file through findings rather than through a court injunction.

    He has not done this.

    Three years after the first anticipatory bail application in 2023, the EACC has not received the full cooperation that its investigators required. The petition is the next escalation in a long-running strategy of procedural obstruction.

    That strategy has been partially effective. Each legal intervention has bought time. Each court order has created uncertainty about what investigators are permitted to do. The three-year delay has allowed the political context to shift the incoming Ruto administration that initially appeared willing to prosecute Kenyatta-era deals has progressively made its accommodation with the former president’s network, reducing the political appetite for prosecutions that would embarrass Kenya’s political establishment. Time is Ngumi’s most valuable ally. The petition is an attempt to convert time into permanence.

    A man genuinely confident that the investigation would clear him would not demand its permanent termination. He would demand its conclusion.

    THE VERDICT OF THE RECORD

    John Ngumi is 68 years old. He has spent more than three decades at the apex of Kenyan finance and governance. He has arranged bonds worth hundreds of billions of shillings, chaired some of the country’s most powerful institutions, and built a personal brand that has opened doors no credential alone could have opened.

    By the standards of Kenya’s elite, he has had a remarkable career.

    But remarkable careers in proximity to state power in Kenya leave traces that do not disappear when the political wind shifts, and the trace that the Telkom transaction has left is one that Ngumi cannot talk his way out of in any forum where hard questions are permitted.

    The record shows: an advisory agreement signed the same day as the NSC approval of the transaction he was advising on; a fee of $3.07 million from the seller’s Mauritius vehicle for five months of work that Parliament found unquantifiable; a payment that made him the largest individual beneficiary of a Sh6.09 billion public expenditure conducted without parliamentary approval, without Communications Authority final approval, and without an Attorney-General opinion on file; a post-hoc tax payment of Sh111.9 million made only after parliamentary scrutiny made the optics toxic; two rapid board resignations from Safaricom and Kenya Airways following the investigation’s intensification; an anticipatory bail application in 2023 framed around the threat that investigators would ‘jeopardise his reputation as one of Kenya’s most celebrated bankers’; and now, in June 2026, a petition demanding that EACC be permanently and judicially prevented from ever examining this matter again.

    That is not the record of a man at peace with the verdict of scrutiny. It is the record of a man who understood, from the moment the first parliamentary question was asked, that the closer investigators looked, the more uncomfortable the answers would become.

    The Sh415 million payday is the headline figure. But the real story is the machinery that produced it the access, the institutional positions, the regulatory knowledge, the political proximity, and the offshore routing that converted five months of advisory work into a fee that dwarfs what most Kenyans earn in a lifetime.

    EACC’s persistence, even after the DPP’s earlier pass, is not prosecutorial harassment. It is the institutional manifestation of an unanswered question: what, precisely, did John Ngumi do for $3.07 million, and for whom was he really doing it? Until that question is answered in an open forum where evasion is not a strategic option, the investigation serves a purpose that goes beyond John Ngumi. It signals to the next generation of well-connected intermediaries who stand at the intersection of public governance and private capital that the receipt does not automatically expire.

    On June 11, 2026, John Ngumi filed a petition asking the High Court to make the receipt disappear. The court has yet to give directions. Whatever it decides, the filing itself is the clearest public statement Ngumi has made in three years of legal manoeuvring: the questions terrify him, and he will exhaust every instrument available to ensure they are never fully answered.

  • The Corrupt Path of KPC Boss Joe Sang: Why Does Ruto Trust Him?

    The Corrupt Path of KPC Boss Joe Sang: Why Does Ruto Trust Him?

    In the murky world of corporate scandals, Joe Sang’s name stands out, tainted by corruption and controversy.

    As the Managing Director of the Kenya Pipeline Company (KPC), Sang has been at the center of numerous allegations of corruption, embezzlement, and abuse of office.

    Despite this, President William Ruto has placed his trust in Sang, raising questions about the President’s judgment and the integrity of his administration.

    Sang’s history raises serious questions: Why is a leader with such a tainted past still in a position of power?

    Is this a sign of deeper issues within the administration? The public deserves answers.

    The Corrupt Path of KPC Boss Joe Sang

    The Corrupt Path of KPC Boss Joe Sang and History of Corruption Allegations

    The story of Joe Sang’s alleged corruption began to unravel in 2018 when the Directorate of Criminal Investigations (DCI) arrested him and several top managers at KPC.

    Among those arrested were Company Secretary Gloria Khafafa and Head of Procurement Vincent Cheruiyot.

    These arrests were part of an extensive investigation into the disappearance of fuel at the Kisumu oil jetty, a scandal that highlighted the deep-seated corruption within KPC.

    DCI’s investigations revealed a loss of fuel amounting to billions of shillings, implicating Sang and his team in a massive theft operation.

    The arrests marked the beginning of a series of legal battles for Sang, with the DCI conducting thorough investigations to bring the culprits to justice.

    The Kisumu Oil Jetty Scandal

    One of the most notable scandals under Sang’s tenure was the Kisumu Oil Jetty project.

    In October 2018, DCI boss George Kinoti summoned Sang, Board Director John Ngumi, and five other officials to record statements regarding the Sh1.8 billion Kisumu oil jetty scandal.

    The project, initially touted as a major infrastructure development, soon became synonymous with corruption and mismanagement.

    The DCI’s investigation into the Kisumu oil jetty project exposed the misappropriation of funds, with allegations that Sang and his team engaged in the construction of an unplanned project amounting to over Ksh.1.9 billion.

    They were charged with abuse of office, willful failure to comply with procurement procedures, and mismanagement of public funds.

    Despite their pleas of not guilty, the evidence against them painted a grim picture of corruption and betrayal of public trust.

    More Corruption Allegations

    The Kisumu oil jetty scandal was just one of the many corruption allegations against Sang.

    The Kenya Pipeline Company was also embroiled in a Sh48 billion pipeline enhancement project, awarded to Lebanese firm Zakheem Limited.

    This project, too, was mired in allegations of fraud and corruption.

    In May 2018, detectives from the Ethics and Anti-Corruption Commission (EACC) raided the homes and offices of KPC staff, including former Managing Director Charles Tanui and General Manager of Finance Samuel Odoyo.

    The raids were part of an investigation into the fraudulent supply of hydrant pit valves worth Sh647 million.

    Sang faced charges of abuse of office and failure to follow proper procedures in authorizing payments for these valves.

    The Corrupt Path of KPC Boss Joe Sang and The Legal Battles

     

    The legal battles for Sang and his team were intense and prolonged. The Director of Public Prosecutions charged them in court, highlighting the misappropriation of funds during the procurement and construction of the Kisumu Oil Jetty.

    Despite the overwhelming evidence, the case took a surprising turn in December 2022.

    In a controversial ruling, the court acquitted Joe Sang and his co-accused, citing that the charges were ‘fatally defective.’

    Magistrate Victor Wakumile noted that the project had been in KPC’s plans since 2006, long before most of the accused joined the company. T

    he acquittal raised eyebrows, with many questioning the integrity of the judicial process and the influence of political connections.

    Political Connections and Ruto’s Trust

    Joe Sang’s tenure is marked by allegations of corruption and financial mismanagement, yet President Ruto continues to place trust in him.

    Joe Sang’s acquittal came at a time when President William Ruto had just taken office.

    The change in leadership brought significant changes to the DCI, with Ruto firing the competent George Kinoti and replacing him with individuals more aligned with his administration.

    This move was seen by many as an attempt to protect allies and shield them from prosecution.

    President Ruto’s decision to reappoint Joe Sang as the Managing Director of KPC in January 2023 further fueled suspicions of favoritism and corruption.

    The appointment, which was made despite Sang’s resignation in 2018 over corruption allegations, was met with outrage from anti-corruption advocates and the public.

    The Law Society of Kenya (LSK) filed a case challenging Sang’s reappointment, leading to a court ruling that temporarily suspended his return to KPC.

    However, in April 2023, the KPC Board, led by Chairperson Faith Boinett, announced Sang’s appointment as the new Managing Director for a four-year term.

    Boinett, another Kalenjin and close ally of Ruto, stated that Sang had emerged as the best candidate in the recruitment process.

    The Corrupt Path of KPC Boss Joe Sang vs The Public Outcry over

    The reappointment of Joe Sang as KPC’s Managing Director sparked public outrage and raised serious questions about President Ruto’s commitment to fighting corruption.

    Critics argue that Ruto’s administration is more focused on protecting allies and consolidating power than addressing the rampant corruption that plagues Kenya’s public institutions.

    The case of Joe Sang is emblematic of the broader challenges facing Kenya in its fight against corruption.

    Despite repeated promises from political leaders to tackle corruption, individuals with tainted records continue to hold influential positions, undermining public trust and eroding the integrity of public institutions.

    Conclusion

    Joe Sang’s corrupt path and his controversial reappointment as the Managing Director of Kenya Pipeline Company highlight the deep-rooted challenges in Kenya’s fight against corruption.

    President William Ruto’s decision to trust and reappoint Sang, despite his tainted history, raises serious questions about the administration’s commitment to transparency and accountability.

    As Kenya grapples with the consequences of corruption, it is imperative for the government to prioritize integrity and justice.

    The case of Joe Sang serves as a stark reminder of the need for genuine and sustained efforts to combat corruption and restore public trust in Kenya’s institutions.

  • How IPPs Power Firms Rob Kenyans Blind In Fuel Tender Scam

    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.”

     

     

  • Mysteries of McKinsey & Company, the firm Kenya Power Intended to Hire as Management Consultant and why it flopped.

    Mysteries of McKinsey & Company, the firm Kenya Power Intended to Hire as Management Consultant and why it flopped.

    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.

    Government’s reason for the red flag on McKinsey might have just been lame from the bull’s eye target shot.

    Members of the Energy committee, who probed the PPAs, questioned why KPLC wanted to bring in the international experts at the time the taskforce was conducting a invetigations into the PPAs. That was so lame, having conducted indepth analysis and research of the international firm which has left dirty tracable marks in every job done and it’s not like Kenya power did not do background check when proposing and settling on McKinsey and Company management consultancy firm. Seems Kenya Power cartels are still full throtle in control and McKinsey was to be their milking cow once again should it have been green-lighted.

    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 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.

    John Ngumi’s influence.

    For introduction, John Ngumi is a persona- non-granta in Tanzania following CFC Stanbic Bank’s East Africa investment Sh600million bribery scandal. Attempted to launder Sh.11billion from Kenya Pipeline Cooperation in lias with KPC CEO Joe Sang using a company called Zakhem International. Next sucessful loot attempt at KPC as he was the Chair was Sh.1billion which he allegedly used  Aero Dispensers Limited and Thermo Dynamic General Supplies shell companies.

    In 2018, this fellow airlifted a bevy of beauties to Mombasa on taxpayers money. Instead of being sacked, he was given another term. He turned KPC  a den of corruption and looting.

    Being President’s favourite, got appointed to chair the taskforce to review IPP’s contracts and the crumbling Kenya power, Kenya insights is convinced that he is the force behind lobby for McKinsey and Company firm.

    Meanwhile, 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, McKinsey was to be hired as management consultant while Boston Consulting Group was to offer the taskforce “a wealth of cross-cultural experience.”

    List of Scandals that McKinley have been involved in.

    1. Enron scandal

    Enron was the creation of Jeff Skilling, a McKinsey consultant of 21 years, who was jailed after Enron reportedly used McKinsey on 20 different projects, and McKinsey consultants had “used Enron as their sandbox

    2. Valeant

    Valeant, a Canadian pharmaceutical company investigated by the SEC in 2015, has been accused of improper accounting, and that it used predatory price hikes to boost growth. The Financial Times states that “Valeant’s downfall is not exactly McKinsey’s fault but its fingerprints are everywhere.” Three out of six senior executives were recent ex-McKinsey employees, as well as the chair of the ‘talent and compensation’ committee.

    3. Rikers Island jail complex

    New York City paid McKinsey $27.5 million between 2014 and 2017 to reduce prison assaults in Rikers Island; but the violence grew and the city abandoned many of the firm’s recommendations.

    The consultancy’s alleged failings included not soliciting the views of inmates or clinic staff; using an encrypted messaging app that deletes messages, allegedly to avoid transparency; initiatives involving the expanded use of Tasers, shotguns and K9 patrol dogs; replacing troublesome inmates with more accommodating ones in the test area, which skewed the data in favor of the project; the use of ineffective data-analytics software; and spreadsheet errors that inflated the baseline rate of violence, against which the project was measured

    4. Role in opioid epidemic

    McKinsey advised opioid makers on how to “turbocharge” sales of OxyContin, propose strategies to counter the emotional messages from mothers with teenagers that overdosed on OxyContin, and help opioid makers circumvent regulation.

    The firm also advised Purdue Pharma to offer pharmacies rebates based on the number of overdoses and addictions they caused. In February 2021, McKinsey reached agreements with attorneys general in 49 states, five U.S. territories, and the District of Columbia. Across the settlements, the firm agreed to pay nearly $600 million to settle investigations into its role in promoting sales of OxyContin

    Controversial clients and association with authoritarian regimes

    1. Role in U.S. Immigration and Customs Enforcement (ICE)

    McKinsey stopped working for U.S. Immigration and Customs Enforcement (ICE)after it was disclosed that the firm had done more than $20 million in consulting work for the agency. McKinsey managing partner Kevin Sneader said the contract, not widely known within the company until The New York Times reported it, had “rightly raised” concerns. In 2019, The New York Times and ProPublica reported on newly uncovered documents which showed that McKinsey, as part of its work with ICE, proposed cuts in spending on food and medical care for migrants.

    McKinsey also advocated for an acceleration of the deportation process, causing concerns among ICE staff that the due process rights of the migrants would be violated. Previously, McKinsey managing partner, Kevin Sneader, had claimed that McKinsey had done no work for ICE in terms of developing and implementing immigration policy; the uncovered documents showed that to be false.

    2. Role in Saudi clampdown on dissidents

    In October 2018, in the wake of the assassination of Jamal Khashoggi, a Saudi dissident and journalist, The New York Timesreported that McKinsey had identified the most prominent Saudi dissidents on Twitter and that the Saudi government subsequently repressed the dissidents and their families. One of the dissidents was arrested. Another dissident’s family members were arrested, and the cell phone of the dissident was hacked.

    McKinsey issued a statement, saying “We are horrified by the possibility, however remote, that [the report] could have been misused. We have seen no evidence to suggest that it was misused, but we are urgently investigating how and with whom the document was shared.” In December 2018, The New York Timesreported that “the kingdom is a such a vital client for the firm — the source of nearly 600 projects from 2011 to 2016 alone — that McKinsey chose to participate in a major Saudi investment conference in October 2018 even after the killing and dismemberment of a Washington Post columnist by Saudi agents.”

    On February 12, 2019, the European Parliament Greens/EFA group presented a motion for a resolution on the situation on women’s rights defenders in Saudi Arabia denouncing the involvement of foreign public relations companies in representing Saudi Arabia and handling its public image, particularly McKinsey & Company.

    3. Support of authoritarian regimes

    McKinsey’s business and policy support for authoritarian regimes came under scrutiny in December 2018, in the wake of a lavish company retreat in China held adjacent to Chinese government internment camps where thousands of Uyghurs were being detained without cause. In the preceding few years, McKinsey’s clients included Saudi Arabia’s absolute monarchy,Turkey’s autocratic leader Recep Tayyip Erdogan, ousted former President of Ukraine Viktor Yanukovych, and several Chinese and Russian companies under sanctions.

    4. South African corruption scandal

    The Gupta family had strategically placed corrupted individuals in various South African government, utilities and infrastructure sectors. It is alleged that McKinsey was complicit in this corruption by using the Guptas to obtain consulting contracts from certain state-owned enterprises, including Eskom and Transnet.

    Working with Trillian Capital Partners (a consultancy which was owned by a Gupta associate),they provided services to the value of R1 billion ($75 million) annually. Trillian was paid a commission for facilitating the business for McKinsey.

    McKinsey hired law firm Norton Rose Fulbright to carry out an internal investigation over the allegations. McKinsey’s then Managing Partner, Dominic Barton, issued a statement following an internal investigation, in which the firm “admitted that it found violations of its professional standards but denied any acts of bribery, corruption, and payments to Trillian.” Corruption Watch, a South African non-governmental organization, filed a complaint about the controversial contract to the US Department of Justice, alleging that there was a criminal conspiracy between McKinsey, Trillian and Eskom in contravention of US and South African law.

    It was revealed in January 2018 that criminal complaints were filed against McKinsey & Company by the South African Companies and Intellectual Property Commission. South African prosecutors confirmed that they would enforce the seizing of assets from McKinsey.

    South Africa’s National Prosecuting Authority concluded in early 2018 that the payments to McKinsey and its local business partner, Trillian, were illegal, involving crimes such as fraud, theft, corruption and money laundering. McKinsey had subsequently been in discussion with Eskom and the National Prosecuting Authority’s Asset Forfeiture Unit to agree on a transparent, legally appropriate process for returning the R1-billion (US$74m) it had been paid – it was confirmed on 6 July 2018 that this had been concluded.Eskom confirmed it received R99.5 million in interest from McKinsey on July 23, 2018.

    The interest payment covers the two years since McKinsey was paid almost R1-billion in 2016. Information relating to allegedly corrupt practices by McKinsey at Transnet in 2011 and 2012 came to light in late July 2018. The weekly Mail & Guardian newspaper reported that a “…new forensic treasury report shows how controversial former Transnet and Eskom chief financial officer Anoj Singh enjoyed overseas trips at the expense of international consulting firm McKinsey, which scored multi-billion rand contracts at the state owned entities.” The “…report reiterates treasury’s recommendations that Singh’s conduct with regards to McKinsey should be referred to the elite crime-fighting unit, the Hawks, for investigations under the Prevention and Combating of Corrupt Activities Act (Precca).

    Under Precca, Singh would be investigated for allegations of corruption as payment for the overseas trips alone would constitute a form of gratification, which is illegal.” The Sunday City Press reported that the forensic report in turn reported that “multinational advisory firm McKinsey paid for Singh to go on lavish international trips to Dubai, Russia, Germany and the UK, after which their contract with Transnet was massively extended.” McKinsey issued a statement that the allegations were incorrect. McKinsey stated that “based on an extensive review encompassing interviews, email records and expense documents, our understanding is that McKinsey did not pay for Mr. Singh’s airfare and hotel lodgings in connection with the CFO Forum and the meetings that took place around the CFO Forum in London and elsewhere in 2012 and 2013.”

    On 11 October 2019 the United States Treasury department announced that it had imposed wide-ranging financial sanctions on three Gupta brothers, Ajay, Atul and Rajesh (aka Tony) and their business associate Salim Essa under the United States Magnitsky Act.

    The Economist reported in November 2019, that McKinsey’s scandals, such as the 2016 South Africa scandal and the allegations of conflict of interest tied to its $12.7bn investment affiliate, McKinsey Investment Office (MIO), are relatively recent in terms of its long history.

    The article said that McKinsey’s legal challenges facing McKinsey’s new global managing partner, Kevin Sneader, may be related to the company’s fast-paced growth with an increase of 2,200 partners compared to 2009. During that same time period, the number of employees increased to 30,000 worldwide from 17,000.

    In 2020 McKinsey representatives giving testimony to the Zondo Commission of Inquiry into State Capture placed blame for the firm’s involvement in the corruption scandal on former McKinsey partner, Vikas Sagar.

  • How Apopo’s tender wars earned Kenya Power a blacklist slot

    How Apopo’s tender wars earned Kenya Power a blacklist slot

    It has emerged that the scandalous acting chairperson of Kenya Power Board, Vivienne Yeda Apopo  and the former chairman of Kenya Pipeline John Ngumi are the architects behind the wrangles that have rocked the loss making Kenya Power.

    Apopo who has a history of championing controversies is now colluding with Ngumi, the man who chairs President Uhuru Kenyatta’s panel to review Kenya Power purchase agreements to dictate tender winners by kicking out managers viewed as ‘obstacles’.

    She has roped in Ngumi who is using his powerful position to change the management structure of Kenya Power board by planting his spanner boys like Sachen Gudka who was brought in to ensure that Asians in their looting ring win lucrative tenders.

    Gudka was planted like Apopo or Elizabeth Rogo who joined to broker deals for international crooks, a role that earned her a slot in the larger and powerful cartel that includes Caroline Kittony who is a cousin to Baringo senator Gideon Moi.

    The four board members have stumped excess authority over top managers at Kenya Power including the ouster of CEO Bernard Ngugi, a move that has was initially tried through the courts but he survived after a petition to remove him was dismissed.

    John Ngumi [p/courtesy]
    Ngugi became a good target because he was engaged in procurement malpractice. His three year term should end in October 2022 but his replacement has been found in Rosemary Oduor who is now serving in an acting capacity. Oduor is a close ally of Apopo and Ngumi’s cartel through which she lobbied for the position. She was also used to sponsor the case that saw Ngugi kicked out on grounds of corruption.

    Ngugi was among the last managers who were still surviving at Kenya Power after ten other managers including Ken Tarus and former CEO Ben Chumo were kicked out in July 2018 after they abused office and cut deals with a dubious private firm which supplied faulty transformers.

    But it is Apopo’s tender wars with Ngugi that have pushed the donor community to issue threats to withdraw funding for the struggling Kenya Power. She is completely blind to the blows  the agency suffered when France chose to withdraw funding after a section of the management was accused of interfering with the tenders at the parastatal.

    The wars intensified after power transmission line contractors association took Kenya Power to the public procurement administrative review board to block a flouted tender. The body was pushing for a review against the accounting officer, Kenya Power in tender no KP1/6E.1/PT/1/21/ A89.

    The power transmission line contractors association were challenging the supply and extension of low voltage lines last mile connectivity at the average cost of Sh20 million. Tender documents show that (LOT-A) involved supply and extension of LV single phase lines and service cables in Migori, Bomet, Nyamira, Homa Bay, Kisii and Kericho counties calculated at Sh9.2milllion or USD 83,500,000.

    And the supply and extension of LV single phase lines and service cables in Kisumu, Siaya, Vihiga, Busia, Bungoma and Kakamega counties was listed under LOT B at a cost of Sh7.4 million or USD 67,100 but only Sh3,3 million was earmarked for Lot C similar program in Embu, Murang’a, Meru and Tharaka Nithi counties.

    The power transmission line contractors association demanded for an order annulling the tender document and the entire procurement process just after the closure of the tender. The body also wanted Kenya Power to withdraw the tender notice and re-advertise it through a fresh notice without the supply and extension works.

    But Kenya Power’s response proved futile after they filed a memorandum of response on July 5 2021 to object the demands by power transmission line contractors.