Kenya Insights

Tag: Public Procurement Administrative Review Board (PPARB)

  • KWS Boss Dr Erustus Kanga Under Radar Over Alleged Sh740M Staff Insurance Tender Scam

    KWS Boss Dr Erustus Kanga Under Radar Over Alleged Sh740M Staff Insurance Tender Scam

    Procurement watchdog nullifies controversial award to Britam as irregularities emerge in evaluation process

    Kenya Wildlife Service (KWS) Director General Dr. Erustus Kanga faces mounting scrutiny following a damning ruling by the Public Procurement Administrative Review Board (PPARB) that exposed serious irregularities in the awarding of a Sh740 million staff insurance tender.

    The procurement watchdog has ordered KWS to conduct a fresh evaluation of the controversial three-year health insurance contract after nullifying the initial award to Britam General Insurance Company (K) Limited, citing violations of procurement laws and unfair treatment of other bidders.

    Forgery and Foul Play Exposed

    At the heart of the scandal lies a sophisticated forgery scheme that saw Jubilee Health Insurance Ltd wrongfully disqualified from the tender process.

    PPARB’s investigation revealed that KWS evaluation committee members fell for a fabricated authorization letter purportedly from Jubilee, which was used to falsely implicate the company in submitting multiple bids through intermediaries.

    The forged document, allegedly issued by Jubilee on April 8, 2025, contained glaring anomalies including incorrect director names and a fictitious physical address.

    When Jubilee requested a copy of the supposed letter, company officials immediately identified it as fraudulent and denied any involvement in its creation.

    “The letter was a forgery perpetrated without Jubilee’s knowledge or consent,” the company stated in its defense, highlighting the sophisticated nature of the deception that initially fooled KWS evaluators.

    Price Inflation Under the Radar

    Adding to the controversy, PPARB discovered that while Britam emerged as the lowest bidder with a quotation of Sh710 million, the final letter of award mysteriously inflated the contract value to Sh740 million – an unexplained increase of Sh30 million that has raised questions about transparency in the process.

    More troubling still, KWS proceeded to issue a letter of intent to Britam at the higher Sh740 million price despite the tender proceedings being officially suspended on April 28, 2025, following Jubilee’s complaint about the forgery.

    Due Process Violations

    PPARB, chaired by lawyer George Murugu and including members Alice Oeri and Alexander Musau, found that KWS had fundamentally breached procurement procedures by failing to afford Jubilee a fair hearing before disqualification.

    “Before arriving at any adverse decision, it is important to give the affected party a fair opportunity to respond to the said allegations. Failure to accord a hearing amounts to a breach of their right to be heard, a key tenet of fair administrative action under Article 47 of the Constitution and the Fair Administrative Action Act,” the board stated in its May 19, 2025 ruling.

    The board emphasized that KWS was obligated to seek clarification from Jubilee, especially given the serious consequences of disqualification from such a substantial tender.

    Eight Bidders, One Winner

    The tender, advertised early this year for comprehensive group medical insurance cover for KWS board of trustees and staff for the period 2025-2028, had attracted significant interest from eight major health insurers: Jubilee, Britam, CIC General Insurance, Old Mutual, Star Discover, APA Insurance, AAR Insurance, and Liaison Group Insurance Brokers.

    The competitive nature of the tender and the substantial value involved make the procedural violations all the more concerning, particularly given KWS’s role as a key state corporation responsible for wildlife conservation.

    Leadership Under Pressure

    Dr. Erustus Kanga, who has served as KWS Director General with over 20 years of experience in biodiversity conservation, now faces questions about the procurement processes under his leadership. The seasoned conservationist, who previously held the position of Secretary for Wildlife at the Ministry of Tourism, Wildlife & Heritage, has built a reputation around transparency and good governance in wildlife management.

    The insurance tender scandal represents a significant test of Dr. Kanga’s leadership at a time when KWS is grappling with various challenges including funding constraints, human-wildlife conflict, and the need for sustainable conservation financing.

    Road to Resolution

    PPARB has given KWS 45 days to conduct a fresh, transparent evaluation of all submitted bids, effectively giving Jubilee and other bidders a second chance to compete fairly for the lucrative contract.

    The board’s decision serves as a stern reminder to all public entities about the importance of adhering to procurement laws and ensuring fair treatment of all bidders regardless of their market position or perceived advantages.

    For KWS, an organization that prides itself on conservation excellence and ethical practices, the tender controversy presents an opportunity to demonstrate that the same high standards applied to wildlife protection also govern its internal operations and procurement processes.

    As the re-evaluation process begins, all eyes will be on Dr. Kanga and his team to ensure that the second attempt at awarding this crucial insurance contract meets the highest standards of transparency, fairness, and legal compliance that Kenyan taxpayers deserve.

    The scandal also highlights the ongoing challenges in Kenya’s public procurement system, where despite robust legal frameworks, implementation gaps continue to create opportunities for irregularities that undermine public trust in government institutions.

    This story is developing and will be updated as more information becomes available.

  • Broke Firm’s Deception Exposed: Jasir Contractors Loses Sh2B Housing Tender

    Broke Firm’s Deception Exposed: Jasir Contractors Loses Sh2B Housing Tender

    In a stunning revelation of corporate dishonesty, Jasir Contractors, a firm so cash-strapped it couldn’t settle a mere Sh1.8 million debt, has had its questionable Sh2 billion affordable housing contract revoked after a procurement board uncovered what appears to be a web of deception and preferential treatment.

    The Public Procurement and Administrative Review Board (PPARB) canceled the lucrative Loitoktok, Kajiado County housing tender awarded to Jasir in January, following revelations that the company misrepresented its financial capacity while the State Department for Housing deliberately overlooked “glaring alterations” and “multiple inconsistencies” in the company’s bid documents.

    Too Broke to Pay, Rich Enough to Build?

    Court records paint a damning picture of Jasir Contractors’ true financial state. While pursuing a multi-billion shilling government contract, the company’s director, Jasper Ireri Mbungu, was simultaneously pleading poverty in court to avoid paying creditors.

    “The 1st defendant [Jasir Contractors], being the principal judgment debtor herein, has been having financial challenges,” court documents reveal. So dire was the company’s financial situation that Mbungu was jailed for 30 days until January 5, 2024, for failing to pay a Sh1.8 million debt to Aakash Limited.

    After his release, Mbungu promised to make monthly installments of Sh75,000 – a commitment the company failed to honor, resulting in another arrest warrant that Mbungu has only escaped through a High Court injunction.

    A Pattern of Financial Deception

    The financial troubles don’t end there. The Kenya Revenue Authority (KRA) successfully pursued the company for Sh4.2 million in unpaid taxes linked to undeclared supply deals worth Sh109.9 million with Meru County Investment and Development Corporation between 2017 and 2021.

    Despite these glaring red flags that should have disqualified Jasir Contractors during financial evaluation, the State Department for Housing awarded them the Sh2.179 billion tender on January 24, 2025 – raising serious questions about the integrity of the procurement process.

    Unfair Advantage Exposed

    The PPARB investigation revealed that the housing department unfairly disqualified competing bids, including one from Jijenge Precast and Construction Ltd that offered to complete the project for Sh63 million less than Jasir’s bid.

    “The evaluation report did not justify as to why the successful bidder’s errors, alteration, omissions and commissions were overlooked while the applicant’s bid was deemed non-responsive for lesser discrepancies,” the PPARB stated, accusing the housing department of failing to uphold “principles of fairness, transparency, and equal treatment.”

    The apparent favoritism shown to a company with documented financial problems has cast a shadow over Kenya’s ambitious affordable housing program, which aims to build over 250,000 homes annually and is partially funded by the controversial 1.5 percent housing levy deducted from Kenyans’ salaries since July last year.

    Questions of Cronyism

    Industry insiders question how a little-known firm registered in 2014, with a history of debt problems and tax evasion, could have been entrusted with a project that requires substantial upfront capital investment.

    This case follows another controversial award to MHOA Africa Limited, owned by Harun Aydin, a Turkish businessman with close ties to President William Ruto who was previously deported from Kenya in 2021. These patterns have fueled growing concerns about possible cronyism in the allocation of lucrative housing contracts.

    For now, the PPARB has ordered the State Department for Housing to readmit and review the previously disqualified bids, but the damage to public trust in the procurement process may prove harder to repair than any housing deficit.

    As millions of Kenyans continue contributing to the housing levy, many are left wondering: Who is really benefiting from Kenya’s affordable housing program?

  • The QISJ saga: Behind-the-scenes wars for the 2021 KEBS tender

    The QISJ saga: Behind-the-scenes wars for the 2021 KEBS tender

    By NLM Writer

    When the Kenya Bureau of Standards (KEBS) floated the tender for Pre-Export Verification of Conformity (PVOC) of used motor vehicles and motor vehicle spare parts on January 19, 2021, among the entities that collected tender documents was Five Blocks Enterprises. Curiously, Five Blocks did not return the documents as a bidder. But, in the ongoing tender process, Five Blocks, through its sole director Dr Charles Nzai, an Environmental and Natural Resource Economist at Kenyatta University, would be at the centre of the tendering.

    The tender has turned into a classic case of dirty tricks being employed to undercut rival bidders, interests converging and diverging, a Directorate of Criminal Investigations (DCI) speaking from both sides of its mouth, the Auditor General seeking to get involved in procurement matters and clashing multiple investigations reports.

    In there are debarment proceedings against two bidders, East Africa Automobile Services (EAA) and Auto-Terminal Japan (ATJ), and the Debarment Committee of the Public Procurement Regulatory Authority (PPRA) keen on rushing through the consequential proceedings before KEBS concludes tender evaluation. Meanwhile, KEBS, who just a year ago expanded the pool of PVOC inspectors, now appear to be leaning towards going back to monopoly.

    Reports suggest that hundreds of millions have been spent by one of the bidders to buy investigators, including members of the Debarment Committee. At least two senior officials at the DCI and KEBS are said to have received bribes to the tune of US$1 million (Sh100 million) each.

    After collecting but not returning the tender documents, Five Blocks twice filed reviews with the Public Procurement Administrative Review Board (PPARB). In the both applications for review, Five Blocks managed to have the tender conditions reviewed and the bidding period extended. A tender that was floated on January 19, 2021 and was originally set to close on February 10 ended up closing on May 5. By the time of closing, only four companies submitted bids for the PVOC for motor vehicles and motor vehicle spare parts: Quality Inspection Services Japan (QISJ), Auto-Terminal Japan (ATJ), East Africa Automobile Services (EAA) and Wilnar International Company.

    Five Blocks Director Dr Charles Nzai, a lecturer at Kenyatta University, wrote to PPRA’s Debarment Committee to have ATJ and EAA debarred. Dr Nzai’s firm did not bid.

    Before the closing of the tender, and after the two successful applications for reviews, the hitherto dirty tricks shifted into high gear: two of the bidders, ATJ and EAA had to be debarred. Dr Nzai – again – on April 1, 2021, went to the debarment committee seeking to have ATJ and EAA blacklisted and therefore blocked from participating in the PVOC tender.

    Looking at the companies who submitted their bids, Dr Nzai’s application would have only meant to benefit one of the remaining bidders if the debarment application was upheld – QISJ because of its experience and financial muscle.

    Just to demonstrate how the debarment application was targeted, Dr Nzai wanted his application determined before May 5, the day KEBS had set for the closing of the tender.

    The application for debarment was based on allegations stemming from a controversial Special Audit Report by the Auditor General that recommended barring of EAA Company and ATJ, accusing them of forging documents and misrepresenting themselves in the tender that was later awarded to QISJ, allegations the two both companies have vehemently refuted.

    Arising from the Special Audit Report, the National Assembly’s Public Investment Committee (PIC) also conducted contentious investigations and also recommended that EAA Company Limited and Auto Terminal Japan (ATJ) be barred from engaging in vehicle inspection tenders.

    But in October 2020, High Court Judge Pauline Nyamweya stayed the implementation of parts of the PIC report.

    Dr Nzai’s application was based on the Special Audit, which the Parliamentary Investments Committee had submitted to the DCI and the Ethics and Anti-Corruption Commission (EACC) for further investigations. To date, neither of the agencies have produced a report on the investigations.

    In fact, when EAA wrote to the DCI on March 25, 2021, inquiring on the status of investigations, John Kariuki responded on May 7, 2021, saying investigations had not concluded, meaning there was no report the Debarment Committee could act upon to convict ATJ and EAA.

    In an unprecedented move that contradicted his head of investigations, John Kariuki, DCI boss George Kinoti wrote to KEBS and the PPRA’s Debarment Committee that the evidence against EAA and ATJ was overwhelming. This is despite the fact that the Mutual Legal Assistance the DCI was seeking to send its officers to Japan to verify the documents and physical facilities had not taken place.

    “We received information and a host of documents for investigations from the Public Procurement Regulatory Authority (PPRA), the Public Investment Committee (PIC) and the Office of the Director of Public Prosecutions (ODPP). The matter is under active investigation and in the process of seeking Mutual Legal Assistance (MLA) to ascertain the authenticity of the documents used to secure tenders at the Kenya Bureau of Statistics. Once the matter is finalised we shall revert,” Mr Kariuki said in the letter.

    From here it gets even more interesting.

    After Mr Kariuki, who heads investigations at DCI, wrote the letter on May 7, his boss George Kinoti unprecedentedly wrote to KEBS and the PPRA’s Debarment Committee that the evidence against EAA and ATJ was overwhelming. This is despite the fact that the Mutual Legal Assistance the DCI was seeking to send its officers to Japan to verify the documents and physical facilities had not taken place.

    Mr Kinoti’s letter was unprecedented because in the ordinary course of events he hardly writes letters concerning investigations. The assignment is often left to the head of investigations, in this case Mr Kariuki. Why was it different this time? We may not know what prompted it.

    Fearing that the Debarment Committee, which has not hidden its leanings on the matter, would act on Mr Kinoti’s letter and debar them, EAA moved to court and obtained temporary court orders stopping the committee from proceeding with the hearings.

    In the whole confusion surrounding the investigations, there is also the issue of which report(s) to believe. There are at least four different reports: The Special Audit by the Auditor General and the PIC report which was based on the Special Audit. Then there is the 2017 PIC report that was based on actual physical presence of MPs on the ground to verify facilities used by EAA and ATJ and which found that they were compliant. The fourth report is by Interpol, which on several accounts, contradicts the AG’s Special Audit.

    Dr Nzai and the hidden hands in the KEBS tender want the Debarment Committee to make its finding based on the Special Audit report and the other by PIC – these two agencies also recommended further investigations.

    Emails and other documents made available to PIC, which the Nairobi Law Monthly has seen, showed that the auditing team had their travels and accommodation in Japan arranged by QISJ, an interested party. And while the auditors claimed in the Special Audit report that they had travelled to South Africa, they later recanted this version on record, meaning they were lying.

    Both ATJ and EAA have raised several objections to the PIC report, among them its validity arguing that it was prepared outside the timelines and also that the officers from the Office of the Auditor General who conducted the audit were conflicted.

    The Auditor General’s audit report was received in Parliament on August 20, 2019. However, the Parliamentary report was concluded in June, 2020 which surpassed the three-months timeline given to Parliament, meaning it violates Article 229(8) of the Constitution of Kenya, thus raising the questions on validity.

    Moreover, emails and other documents made available to PIC showed that the auditing team had their travels and accommodation in Japan arranged by QISJ, an interested party. And while the auditors claimed in the Special Audit report that they had travelled to South Africa, they later recanted this version on record, meaning they were lying.