Suspended Local Government Permanent Secretary Mr Sammy Kirui.
THE PUBLIC RIP-OFF AT CITY HALL; THE FACTS, FICTION AND THEATRE
By Miguna Miguna, MARCH 10, 2010
In law, they call it an open and shut case. That’s what the rip-off surrounding the “purchase of land for cemetery by City Council of Nairobi” is. This is a fraud from the beginning to the end. Let me explain using credible primary evidence and chronologically demonstrate how this fraud was cooked and executed by senior public officers at the Treasury, Nairobi City Council and Ministry of Local Government.
A letter by then PS for Local Government, Sammy Kirui dated 25 June 2008 addressed to the former Town Clerk of Nairobi, John Gakuo, refer to various correspondence between the Nairobi City Council, the Ministry of Local Government and Treasury confirming that the “Government” had allocated funds for the fraudulent transaction. The letter notes that a meeting held at the Ministry headquarters and chaired by the Senior Deputy Secretary on 5 June 2008, stressed the need to “finalize” the transaction. By this date, no land had been identified or purchased. It is unclear how and why Sh 350 million of public funds was released by Treasury to Mr. Kirui.
On June 27, 2008, Mr. Kirui instructed that payment for the non-existent land be processed and Sh 350 million be paid out to unidentified people. The parcels of land identified for purchase were LR 23222, 23223, 23224, 23225, 23226, 23227, 23228, 23229 and 23230, measuring 75 acres to be purchased for use as cemetery. There is reference to a draft sale agreement between the City Council and some unnamed vendors.
Mr. Kirui directed payments on State Counsel E.N. Torome’s Memo dated 27 June 2008. The same day, the Principal Accountant at the Ministry, J.O. Warega, wrote to the Chief Accountant confirming that Mr. Kirui had “approved payment.” Mr. Warega instructed the Chief Accountant to prepare payment of Sh 289 million to E.N. Omotii & Company Advocates as “per the approval.” No indication why this large sum is being paid out. This happened before the land had been located and no Sale Agreement had been signed.
Mr. Kirui sent another letter to Mr. Gakuo on 8 September 2008 stating that “it is noted from your letter that identification of a suitable parcel of land for use as a cemetery through personal visits is not yielding results.” He directed that a paid advertisement be placed seeking appropriate land. Yet, payments were processed by Mr. Kirui more than six months before the required procurement conditions were met or appropriate land identified.
On 30 October, 2008, Mr. Kirui sent another letter to Mr. Gakuo stating that: “It is now 5 months since you initiated action on this matter and yet you have not concluded and advised the Ministry to effect payment. The continued holding of this payment is adversely affecting other financial transactions in the Ministry. From the date of this letter I want to get this matter concluded within a period of 5 days. At the expiry of this period the Ministry will take over the procurement process and proceed with the advertisement for the purchase of the land for the cemetery.”
The haste and desperation to conclude the fraud so as to cash the large public cheque is obvious from the contents of Mr. Kirui’s letter.
By letter dated 4 December 2008, Mr. Kirui says to Mr. Gakuo: “it is particularly disturbing that the tender documents are alleged to have been defective.” Yet, on 18 December 2008, in response to a query by the Chief Financial Officer over the same issue and recommendation that the ministry’s State Counsel peruse the documents, Mr. Kirui responded that “State Counsel perusing the agreement is just another bureaucratic hurdle” to delay the transaction. Kirui pointed out that even “the other bidders” had not complained. Bureaucratic procedure suddenly becomes an unnecessary hindrance.
None of the documents were copied to or signed by Hon. Musalia Mudavadi, in violation of section 144(2) of the Local Government Act that states that all land transactions must be approved by the minister.
On 15 February 2010, the Controller and Auditor-General forwarded his audit report on the transaction to the finance minister, Uhuru Kenyatta. He also delivered a copy to Hon Mudavadi who then forwarded it to the KACC on 17 February 2010, and requested that action be expedited on the matter. On 19 February 2010, Mr. Mudavadi sent a letter to Amb Muthaura, with a copy of the report and asked Muthaura to “take peremptory measures” to implement the report’s recommendations.
Neither KACC nor Muthaura took any action; not until the irregular leakage of an incomplete KACC report. The true value of the land in question is Sh 24 million. The transaction was sealed using a forged valuation report that inflated the price to Sh 325 million, which was paid out to among others, a sister to the PNU’s James Nyamweya. The land purportedly purchased is not the same as the nine parcels listed above. Mudavadi was not involved and never received a cent.