Public Service PS Omollo, NYS boss Ndubai step aside over Sh9bn scam

Public Service Principal Secretary Lillian Omollo and National Youth Service (NYS) Director-General Richard Ndubai have stepped aside to allow probe over alleged loss of billions.

State House Spokesman Manoah Esipisu on Friday said the two officials will step aside for three months.

"Investigative agencies have over the past few weeks been investigating payments at the National Youth Service (NYS), with a clear intention of ascertaining whether they were made following the correct procedures, whether they were made for services delivered, and whether there was any fraud committed in the processes," the State House statement said.

Mr Esipisu said President Uhuru Kenyatta has already accepted the offer by the two senior officials to step aside.

Their decision comes after MPs on Thursday threatened not to approve any budgetary allocations for NYS programmes until action is taken against the culprits behind the alleged Sh9 billion scandal.

The National Assembly's Committee on Labour and Social Welfare also demanded the list of the fictitious companies that were paid the money to be made public.

And, surprisingly, companies flagged by the Auditor-General and the Ethics and Anti-Corruption Commission (EACC) in the past for possible fraud are still doing business with the government.

Among them is Fastlane Freight Forwarders, which had its accounts frozen by the High Court in the wake of “reasonable suspicion” that it had received Sh209 million from NYS as reimbursement for clearing and forwarding costs for equipment, even though there was no proof that the services had been rendered.

Interscope Tech and Services, which received Sh176 million of the NYS money, is also cited in the Auditor-General’s report of 2012, indicating it has had previous dealings with the government.

Others are Njewanga Enterprises (Sh80 million), Ngiwaco Enterprises (Sh117 million), Ngirispa Enterprises (Sh18 million) and Smart Variety Stores (Sh153 million).