Waiguru ‘firms’ linked to theft of NYS funds

Former Devolution Cabinet Secretary Anne Waiguru reportedly registered four companies that benefited from billions of shillings stolen from the National Youth Service (NYS), MPs heard Thursday.

Former NYS director-general Nelson Githinji gave the evidence before the Public Accounts Committee (PAC) on what he knew about the scheme to steal funds from the service.

Testifying in an open session, Mr Githinji accused Ms Waiguru of malpractices, before requesting to go into a closed session to divulge more information.

Sources at the committee said that it was during the closed session that information regarding Ms Waiguru’s alleged direct involvement in the scandal came to light, with reports that she had four companies that received payments from the NYS.

“The committee is privy to information that there were four companies linked to Waiguru that won tenders in the NYS running to millions of shillings,” said the source.

This is the second time that Ms Waiguru, who was at the helm of the powerful Devolution ministry at the height of the scandal, has been linked directly to the scam.

The first was by one of the suspects, Josephine Kabura. In a sworn affidavit, Ms Kabura claimed that Ms Waiguru was the mastermind of the scandal.

Ms Waiguru vehemently denied the claims, saying she had not met her before.

The former minister dismissed Ms Kabura as a “hairdresser” who could not have visited her house, where some of the alleged deals took place.

Following the claims, Ethics and Anti-corruption Commission detectives searched the houses of suspects mentioned in the scam, including that of Ms Waiguru, but did not find anything that could have suggested she was culpable.

Ms Waiguru has maintained her innocence, saying that she was a whistle-blower.

According to the source at the PAC, Ms Waiguru’s alleged companies were separate from three firms associated with Ms Kabura that were reportedly paid close to Sh1 billion to pave a road in Kibera, Nairobi, which auditors said should have cost Sh78 million.

Dr Githinji told MPs that his deputy, Adan Harakhe, got the Authority to Incur Expenditure through the Integrated Financial Management Information System (IFMIS) before being formally appointed to a senior position at the NYS.

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The PAC has also been told in the past that the official title of “senior deputy director-general” did not exist and was created specifically for Mr Harakhe, and that apart from getting the Authority to Incur Expenditure, he also was made head of key departments.

“Although his letter of appointment indicated that I was his immediate supervisor, that was not the case since he reported directly to Ms Waiguru,” Mr Githinji said.

Investigations and records of IFMIS entries indicate that Mr Harakhe authorised Sh695 million payments in which zeroes were added to inflate the amount.

The former NYS boss also refuted claims that his wife, his sister-in-law and her husband got contracts worth Sh133 million, saying the woman mentioned was not his brother’s spouse, and that his sister-in-law was a single mother, and thus the claim that she had a husband was false.

He termed as “thoughtless and libellous” claims by Mr Harakhe that some contracts were set aside by his wife, adding it was a scheme to hide the facts of the matter.

According to Directorate of Criminal Investigations head Ndegwa Muhoro, although some of the companies were paid millions allegedly to supply building materials and construction works, there was no evidence they engaged in any of the works.

For instance, a company contracted to tarmac a road in Kibera did not do any work, as construction, including supply of materials, was done by NYS recruits and trucks.

Investigations also indicate that 21 more companies were involved in the irregular procurement, receiving payments running up to Sh999 million, but it was not clear whether the alleged companies associated with Ms Waiguru, were among them.

The total amount stolen from the NYS has hit Sh1.8 billion, with the EACC indicating that the investigations were evolving and more evidence was being gathered to suggest that the figure stolen from the NYS, whose budget was Sh25 billion in addition to a Sh3.8 supplementary budget, could rise.

Sources at the Public Accounts Committee meeting chaired by Rarieda MP Nicholas Gumbo indicated that a former top official of the NYS, under suspension over the Sh791 million scandal, had given details about the former minister's alleged involvement in the mega scandal.