Top officials on the spot over transfer of Sh8bn from State’s secret accounts

The Office of the President (OP) is in the spotlight over the suspicious transfer of Sh8.3 billion into and out of the government’s secret security accounts.

Large transactions happened during the 2013 transition period, raising audit concerns.

The Auditor-General’s report, released a month ago, flagged some of the cash movements.

A source with close knowledge of the workings of the OP said the large cash transfers were part of the reason President Kenyatta transferred senior officials and procurement staff.

The leaks point to serious behind-the-scenes infighting at the OP, whose top officials are powerful because of their proximity to the presidency, their control of large budgets and security responsibilities.

Joseph Kirubi, the former director of finance and administration at the President’s Office, was removed in March alongside more than 100 procurement staff after the President ordered their redeployment.

AMMOUNT 'SCANDALOUS'

On Monday, Defence Principal Secretary Mutea Iringo, who as permanent secretary at Internal during the transition was the accounting officer, pointed out that his transfer last Thursday had nothing to do with audit queries.

“Someone is trying to be malicious. My transfer has nothing to do with it. The mentioned amount is scandalous, it cannot be,” Mr Iringo said when contacted by the Nation.

His boss at the time, Mr Francis Kimemia, who was head of Public Service, was also demoted to the less glamorous job of Secretary to the Cabinet.

The big job went to former Treasury Permanent Secretary Joseph Kinyua, who also doubles as President Kenyatta’s Chief of Staff.

LARGE WITHDRAWALS

The Nation has seen copies of documents that show withdrawals of cash through accounts registered under the Commissioner of Police and Office of the President, long after the Office of the Commissioner of Police was scrapped and an Inspector-General of Police sworn in in December 2012.

The Auditor-General’s report questioned these withdrawals and another Sh2 billion that had not been accounted for.

“During the year under review, the ministry transferred a total amount of Sh8.3 billion to Kenya Police Service through contra-entries on cash book and Ministry headquarters recurrent bank account amounting to Sh1.4 billion and Sh6.9 billion respectively.

“On March 14, 2013 alone, Sh2 billion was transferred through account number 0-101-000-6530101 through voucher number 272 under the account name Police Commissioner which was closed in December 2012.”

PAYMENT VOUCHERS

The Sh2 billion was withdrawn only four days after the declaration of official presidential results by the Independent Electoral and Boundaries Commission.

The Auditor-General’s report states: “The transfer of Sh1,415,000,000 through contra entries was not supported by payment vouchers contrary to section 5.5.11 of the Government Financial Regulations and Procedures.”

The auditor further revealed that Sh2.8 billion out of the Sh8.3 billion transferred from OP to the said “police commissioner’s account” was not receipted and that a further examination of the Police account revealed the withdrawal was not approved by the accounting officer.

UNACCOUNTED FUNDS

In the audit report, the Ministry of Interior and Coordination of National Government, which took over some dockets previously under the Office of the President, is said to have attempted to prove the financial movement of Sh2.3 billion of the Sh2.8 billion under audit as unaccounted funds, claiming it was re-channelled to the ministry from the police headquarters.

But auditors were unconvinced.

The report states: “The ministry purports that cash amounting to Sh2.3 billion was transferred from Kenya Police headquarters back to the Ministry of Interior and Coordination of National Government.

“However, the justification and utilisation of the alleged security funds by a non-security agent has not been explained. Further, the explanation for the remaining Sh511,000,000 has not been factual.”

PROHIBITED REALLOCATION

The report states that the Ministry of Interior, then under Mr Iringo as PS, claimed that it transferred Sh400 million to the National Intelligence Service.

But the auditors rejected the explanation, arguing that the law prohibited reallocation of funds from one government entity to another.

Said Mr Iringo: “We gave all responses to the audit queries as raised by OAG (office of Auditor-General). Everything must have been explained to them. There is nothing we never explained.”

Further, the ministry’s claim that it paid Sh25 million to the Criminal Investigations Director on March 8 was also rejected after verification of cheque number 08619, through which the payment was made, was found to have originated from the ministry and not from the Kenya Police headquarters.

CASH PAYMENTS AT ELECTION TIME

Payment vouchers seen by the Nation revealed a sequence of payments, mostly in cash, around the time the country was engaged in elections.

The Inspector-General of Police was unavailable for comment while Mr Kirubi, who is now at the Ministry of Mining, did not respond to calls and several text messages.

The last Commissioner of Police, Mr Mathew Iteere, retired on December 24, 2012.

But OP officials continued to credit millions of shillings to the Commissioner of Police’s official account as late as June this year.

Normal practice at the security docket is to open an account into which a specific amount of money is put for use by the person in charge of the police to discharge his duties.

OPEN TO ABUSE

This confidential expenditure is normally not questioned, with the auditors saying it is open to abuse.

Intriguingly, Mr David Kimaiyo had taken over as Inspector-General of Police on December 21, 2012, and a new account was supposed to have been opened for him.

Four times, millions of shillings were also deposited in his account.

There are numerous examples that the Nation has seen of millions credited into the account of the Commissioner of Police, long after it ceased to exist, and the money then withdrawn by OP officials.

PAYMENTS QUESTIONED

Source: Total Cash Transferred to Commissioner of Police from Office of the President, Ministry of Interior and Coordination of National Government during F.Y. 2012/2013