Treasury accuses Raila of plot to wreck economy

Saturday January 16 2016

National Treasury Cabinet Secretary Henry Rotich. The Treasury has assured Kenyans living in the diaspora that a presidential directive easing importation of cars by the diaspora is being implemented. PHOTO | SALATON NJAU |

National Treasury Cabinet Secretary Henry Rotich. The Treasury has assured Kenyans living in the diaspora that a presidential directive easing importation of cars by the diaspora is being implemented. PHOTO | SALATON NJAU | NATION MEDIA GROUP

By SATURDAY NATION TEAM
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The National Treasury on Friday accused Cord leader Raila Odinga of a plot to scare away investors through his “false” Eurobond theft claims.

Cabinet Secretary Henry Rotich, who is among three Treasury officials whose resignations Mr Odinga has demanded, said the claims of theft by the ODM leader are based on “outright lies and subversion of the truth for political gain at the expense of the Kenyan economy”.

And as Mr Rotich came out fighting, Central Bank of Kenya chairman Mohamed Nyaoga gave Mr Odinga until Monday to withdraw remarks he made linking him to the alleged theft of Sh87.7 billion Eurobond funds.

Mr Rotich said various state-sanctioned audits, including those by the Director of Public Prosecution (DPP), the Ethics and Anti-Corruption Commission (EACC) and the Director of Criminal Investigation (DCI), had absolved the Treasury from any wrongdoing, yet Mr Odinga had persisted with his allegations.

ECONOMIC SABOTAGE

He claimed that Mr Odinga’s statements were meant to hurt the economy through sabotage by keeping away investors.

“The Kenyan people must hold him to account for lost opportunities now and in the future. There is nothing new in his claims,” Mr Rotich said, accusing the former Prime Minister of engaging in malicious destruction of the reputations of public officers and institutions without presenting evidence of misconduct.

“In this day and age, it is shameful that someone can cast aspersions on independent, reputable and highly regulated institutions such as the Federal Reserve Bank of New York, JP Morgan Chase Bank and Citibank New York without evidence,” said the CS.

“Anybody who is sensible and well-intentioned will be able to see that the claims that are now being made by the former Prime Minister are false and misleading.”

COVER UP

On Thursday, Mr Odinga raised questions on the whereabouts of Sh87.7 billion of the Eurobond proceeds, arguing that top Treasury and Central Bank officials acted under instructions from someone senior in the Jubilee administration to cover up what he described as the “grand robbery of Kenya”.

He demanded the resignation of Mr Rotich, Treasury Principal Secretary Kamau Thugge and Chief Accountant Bernard Muiruri Ndung’u, for allegedly for covering up the theft.

He named 10 top Treasury and CBK officials, who he claimed received instructions from a network of top Jubilee officials working together with intermediaries in London, New York, South Africa and Qatar to hide the theft through money laundering.

Mr Odinga demanded explanations from the Federal Reserve Bank of New York, where the money was banked and from the lead transaction advisers, JP Morgan Chase Bank, South Africa branch, on how the money was moved and spent.

NO FUNDS LOST

On Friday, however, Mr Rotich said no funds were lost because the government received the Eurobond money, which increased the CBK forex reserves.

“The SWIFT transfer documents and the bank statements from the JP Morgan Chase Bank and CitiBank relating to these transactions were shared with Parliament, the Auditor-General, investigators and the media and they were posted on the National Treasury’s website.

As indicated earlier, it is evident to well-meaning Kenyans that the money was received at the CBK,” said Mr Rotich.

On the seven letters, which directed the Central Bank to make transfers to the Consolidated Fund and which Mr Odinga had described as questionable, the CS said it was ridiculous for anyone to purport that the letters were not authentic and that the transfer instructions were not genuine.

“These were the transfer instructions to the CBK to move the funds from the Sovereign Bond Account to the National Exchequer Account.

We have shared the letters with the Auditor-General, the Controller of Budget, the Ethics and Anti-Corruption Commission and the Director of Criminal Investigations, who have confirmed that the funds were received into the National Exchequer Account from the Sovereign Bond Account at the CBK, from where the Controller of Budget authorised the withdrawals.

We also have posted them onto the National Treasury website for public consumption,” Mr Rotich said in a statement.

Speaking by telephone, Dr Thugge said Mr Odinga did not understand the Eurobond transaction, saying Kenya got an equivalent amount of money in shillings from the CBK, which bought the dollar reserves deposited in the Fed Bank.

“We sold the dollars to the CBK, which created a shilling account here in Kenya and put the money in the sovereign account so the $999 million became CBK money,” he said.

INCREASED RESERVES

The PS said the CBK reserves increased in the same amount as that wired to the Fed Bank.

Mr Odinga had named Mr Nyaoga, CBK Director (Financial Markets) John Birech, the Manager, Financial Markets, Mr Moses Muthui, and former Governor Njuguna Ndung’u as “persons of interest” in the saga.

On Friday, Mr Nyaoga’s lawyer, Mr Ken Ogeto, accused the former PM of tarnishing the name of his client with impunity and gave him until Monday to prove how the CBK chairman was involved in the Eurobond transactions.

“We are instructed to demand that you immediately provide full and detailed particulars of our client’s alleged role in the alleged Eurobond scandal,” Mr Ogeto said.

The lawyer said they would file a defamation case in court without informing Mr Odinga if he fails to respond.

-Reports by Brian Ngugi, Guguyu Otiato and Eunice Kilonzo