GRILLED

Fast track probe on Sh51m Kilifi fraud to unlock recovery, Senate team tells EACC

Governor Kingi questioned over irregular transfer of cash

In Summary

• EACC liaison officer said the commission sought the stay order to freeze any negotiations to allow it investigate criminal aspect of the matter and bring the perpetrators to book.

•But Kingi said the admission by the firms and recovery of the firms would have strengthen the ongoing probe if the order would have been lifted.

Kilifi Governor Amason Kingi when he appeared before the Senate County Public Accounts and Investment Committee on June 8, 2020.
Kilifi Governor Amason Kingi when he appeared before the Senate County Public Accounts and Investment Committee on June 8, 2020.
Image: EZEKIEL AMINGA

A senate oversight committee has implored the EACC to fast track the probe on the Sh51 million fraud in Kilifi to unlock the recovery of the cash.

The County Public Accounts and Investments Committee appealed to the Ethics and Anti-Corruption following the lamentations by the county government that the agency was hindering the recovery of the money.

Appearing before the committee on Wednesday, Governor Amason Kingi told the nine-member panel that the commission has stalled the recovery of the cash after it obtained a court order stopping any negotiations.

 
 

“The commission went to court and obtained a stay order. All the civil cases that we had filed in court to recover the money were all affected and now there is nothing we can do,” Kingi said.

According to the governor, all the firms that reportedly manipulated the financial system and transferred the cash to their own private accounts had agreed to refund the cash in an out of court agreement.

However, the EACC moved in and launched investigation into the fraud that involved more than Sh59 million.

The county chief disclosed that some Sh8.3 million had already been recovered at the time the commission obtained the order, adding were it not for the order, entire amount would have been recovered.

In 2016, crooks are said to have gained access to the county’s bank accounts after they manipulated the electronic money transfer system – Integrated Financial Management System (IFMIS).

They reportedly stole passwords belonging to 10 officials and used them to access system where they transferred the cash from the county’s account at the Central Bank of Kenya.

The county’s internal auditor flagged out the fraud.

 
 

EACC liaison officer attached to the committee, Eve Wachuka, said the commission sought the stay order to freeze any negotiations to allow it investigate criminal aspect of the matter and bring the perpetrators to book.

But Kingi said the admission by the firms and recovery of the firms would have strengthen the ongoing probe if the order would have been lifted.

We have corporate with EACC our only departure with them is that we would have allowed the civil case to proceed and we recover the money, this would have strengthened the criminal proceedings.
Kilifi Governor Amason Kingi

Committee chairman Sam Ongeri instructed the clerk to write to the commission to urge it to fasten the probe to enable the county government recover the money.

In the 2017-18 audit report on the financial expenditure of the Kilifi county executive, Audit General flagged the loss but clashed with the county on the actual amount lost.

“The schedule availed for audit review revealed that the total amount of cash lost before recovery was Sh51.5 million, out of which an amount of Sh8.3 million was recovered leaving unaccountable loss of Sh43.2 million,” reads the report.

But the governor insisted that the actual loss was Sh59 million and already Sh8.3 million has been recovered.

The committee put Kingi to task over irregular transfer of Sh105.3 out of Sh163.3 million from the retention bank account to the payment of salaries.

“The amounts paid were irregularly charged to retention account as the account is supposed to hold only retention money for contractors,” reads the report.

The governor defended his administration, saying the funds were channelled towards payments of salaries owing to the delays in the disbursement of exchequer by the National Treasury.

“The alternative would have been to borrow from a commercial bank, in which the county would accrue interest costs. Therefore, by transferring money from the retention account, the County Treasury was avoiding short term borrowing,” he said.


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