NGO under investigation over alleged Sh300 million fraud

Police are investigating a non-governmental organisation that may have defrauded dozens of companies and individuals of millions of shillings by advertising to be supplied with goods for supposed charity work.

Several companies responded to a newspaper advertisement by JOYTHARC International last year and received the go-ahead to supply the goods, but most have not been paid, while others received partial payment.

The Directorate of Criminal Investigations (DCI) and the NGO Coordination Board are also pursuing the links between JOYTHARC International — which has no previous registration records — and Joy Vision for Youth and Children International — which was recently blacklisted by the regulator.

But the authorities are investigating to determine whether the two are operated by the same people.  The two entities claimed to assist children from marginalised areas, including Isiolo, Laikipia and slums in Nairobi.

Earlier this month, the NGO Board published a notice in the Daily Nation warning against dealings with JOYTHARC and Joy Vision for Youth and Children International as investigations into the fraud allegations continued.

Investigators suspect some of the goods supplied, estimated to be worth at least Sh300 million, were later sold to large retailers and found their way to the market with the rest still being held in go-downs waiting to be sold.

Yesterday, head of DCI Ndegwa Muhoro confirmed his officers were pursuing crucial leads on the alleged scam.
“We have received the case and we are investigating,” Mr Muhoro said.

SENATOR

Documents seen by the Sunday Nation and sources close to the investigation who did not want to be named indicated that among the alleged victims was a senator who supplied building materials worth Sh27 million, while an official from the Office of the President supplied the NGO with sugar and cereals worth Sh23 million. They were never paid and have since last year been trying to locate the organisation’s officials.

An official of the Murang’a County government, who spoke to the Sunday Nation, also claimed to have supplied wire mesh worth Sh6 million in August last year but had not been paid.

Transaction documents from a company known as Elgonot, which claimed to have lost Sh11.4 million, showed it supplied roofing sheets and twisted bars worth Sh15.9 million between April and June last year.

JOYTHARC paid Sh4.2 million in 11 cheques issued between May and December last year, but had not paid the balance of Sh11.4 million.

Last August, Sukim Enterprises supplied various items worth Sh4.3 million through an LPO financed through Nairobi’s Umoja branch of a local bank but only Sh700,000 was paid.

Some of the correspondence between JOYTHARC and the bank manager indicated a commitment from the NGO that they would pay — something that was yet to be done. 

Another company, Pizza Planet, supplied sugar, cooking oil and rice worth Sh11.6 million in November. A delivery note signed by JOYTHARC showed the goods were received at its Mombasa Road go-down.

NGO Board executive director Mahamed Fazul said the banks and companies were duped because most readily trust charity organisations based on their work.

“People don’t doubt NGOs because they think anyone who feeds hungry children or provides free medical care is trustworthy,” he said.

“Anyone who claims to do these things is rarely scrutinised by donors because they think they are involved in a worthy cause and suppliers because of the notion that NGOs have endless supply of money.”

According to the board a meagre 34 per cent of the NGOs in the country are complying with the NGO Act.

Attempts to get a response to these allegations from the NGO have been futile. Mobile phone numbers belonging to its listed directors remained switched off and its purported offices on Peponi Road were locked even though there seemed to be activity inside the compound when the Sunday Nation visited last week.