Get-rich-quick games in advertisement scandal
Information Communication and Technology CS Joe Mucheru and his National Treasury counterpart Henry Rotich at a past event in Nairobi. PHOTO | FILE | NATION MEDIA GROUP
What you need to know:
- Dummy companies were created, some with names very close to those of existing media houses, to which monies were paid once disbursements to genuine service providers were approved.
- A list of payments indicates that Sh21m was paid between November 2017 and June this year to an entity variously referred to as The Star Publication, Star Publications and Star Publications Limited.
- The Sunday Publishers which received Sh28 million is shown as The Sunday Publication Limited while Xtra publishing Limited, the beneficiary of Sh5 million, is listed as Xtra publishers Limited in some schedules.
“The money that used to pay the Aga Khan (in reference to Nation Media Group which is majority owned by the Aga Khan Fund for Economic Development) is now going to fund Jubilee’s re-election in 2017,” a whistle-blower recalls a former Government Advertising Agency (GAA) official telling accounting staff as he demanded money in cash one evening.
When they questioned how the money he was collecting regularly would be accounted for, his response was curt. “Find a way. Wazee wanangoja (bosses are waiting).
This is just one of the snippets Nation has come across in its bid to uncover how the agency ended up owing media houses more than Sh2.5 billion.
Officially, the agency pleads inadequate support from Treasury and other ministries, departments and parastatals that it books space for.
Insiders, however, paint a picture of a gravy train that by the time the Directorate of Criminal Investigations (DCI) completes its probe into the matter could stretch from GAA, stop over at the ministries of ICT and the Treasury before terminating at some of the top offices in the land.
BUY A PLOT
“Four years is a short time. Tell me how someone earning Sh400,000 gross a month can buy a plot in an upmarket estate, build a palatial home, establish a capital intensive business and still buy a top of the range limousine. Another official had at one time Sh8 million in a bank without selling an asset or taking a loan,” the whistle-blower, a former GAA official, said.
The cases serve to illustrate the get-rich-quick schemes, nepotism and fictitious accounting that may help explain how well-connected individuals lined up their pockets leaving the government in debt.
Insiders said dummy companies were created, some with names very close to those of existing media houses and publications, to which monies were paid once disbursements to genuine service providers were approved.
A list of payments seen by the Nation, for instance, indicates that Sh21 million was paid between November 2017 and June this year to an entity variously referred to as The Star Publication, Star Publications and Star Publications Limited. Another Sh2 million was paid to Liaison Media which in other entries is shown as Liaison Media Nairobi.
CLERICAL ERRORS
The Sunday Publishers which received Sh28 million is shown as The Sunday Publication Limited while Xtra publishing Limited, the beneficiary of Sh5 million, is listed as Xtra publishers Limited in some schedules. The Sunday Publishers, which produces the Sunday Express, said it has no links with The Sunday Publications Limited. Insiders front two theories.
The first is that they could be clerical errors, an unlikely scenario because cheques have to have a payee’s precise name. The second is that dummy companies were introduced with names close to those of established media to siphon off public money.
On Monday, government officials were cagey on how and when the debt would be settled with Treasury Cabinet Secretary Henry Rotich referring the Nation to his ICT counterpart Joe Mucheru.
While stressing that he was not an accounting officer (that is the role of a principal secretary) and he did not wish to publicly speak on matters between the ministry and its clients, Mr Mucheru said he will make sure payments are made.
BEING PROACTIVE
“The payments are coming but we are not publicising in the media. We are being proactive,” he said. ICT PS Jerome Ochieng had not responded to our queries by the time of going to Press.
Mr Mucheru said he had briefed executives of some media houses on the way forward, including a payment plan, a position that media houses denied.
However, he has invited media owners to a meeting this morning.
Small media owners, who are owed about Sh130 million, meet on Tuesday to strategise on how to have their money paid. Among the items on the table is drawing a petition that will be forwarded to two Parliamentary committees, that of ICT and Finance.
Their proposal is that Treasury clears the debt and recovers it from the budgets of ministries, departments and parastatals that owe media houses.
The Directorate of Criminal Investigations has launched investigations.
