Uncanny urgency in releasing cash for phantom dams suspect

I am taking the liberty to give unsolicited tips to the Director of Criminal Investigations, Mr George Kinoti, as he progresses with the dams scandal probe.

I know I may be repeating the obvious but the place where Mr Kinoti and his team should put the most emphasis is in following the money.

And the DCI is better placed to make an impact where many did not because he has the support of the recently created multi-agency team, allowing him to work more closely with a wider range of agencies such as the Financial Reporting Centre, the Banking Fraud department of the Central Bank of Kenya, the Asset Recovery Agency and the Kenya Revenue Authority.

Mr Kinoti and team now have the enhanced capacity to follow the money that has been stolen in the dams scandal through the entire national payments system and to sniff out all the nooks and crannies where the ill-gotten wealth is hidden.

PROBE

If he digs deeper and follows the expenditure on items unrelated to dam construction that he has so far flagged — such as towels, whisky, floor tiles and insurance services — that may lead him to a complex money laundering scheme with a trail pointing to shadowy nominee bank accounts, accounts with foreign exchange bureaus, stockbrokerage houses and monies corrupt public officials launder through investments in grand property development projects.

I suggest that Mr Kinoti leads a national debate on the quality of suspicious transaction reporting — whether or not we should not bring more conduits where corruption proceeds are likely to be hidden into the orbit of the FRC.

Isn’t it time we brought other conduits — such as lawyer-client accounts, numbered bank accounts and nominee accounts in banks — into the purview and dragnet of the FRC?

Only commercial banks are obliged by law to report suspicious transactions to the FRC.

Mr Kinoti’s investigations should also go deeper — into conducting lifestyle audits of all public officials involved in making decisions on the two dams, to track and trace the millions of shillings purportedly spent on floor tiles and towels.

KICKBACKS

When National Treasury Cabinet Secretary Henry Rotich argues that advance payments to contractors is normal practice, he makes a valid point.

But, as we all know, and as we read in contemporary literature on corruption in Africa, advance payments are the conduits for bribes and other illegal payments to public officials.

Indeed, the reason corrupt officials love projects with a provision for huge advance payments is because the arrangement allows kickbacks to be paid even if the project does not take off.

This is the heart of the matter in the investigations Mr Kinoti is conducting.

International contractors also love such projects because they can sit back and enjoy the billions for months even as the government negotiates sticky issues such as land compensation and resettlement action plans.

BROKE FIRM

Is it not incredible that we were prepared to release the billions of shillings to that broke Italian contractor despite the fact that even something as rudimentary as acquiring the land where the dams were to be built had not been done.

Where is the sense and economic merit of releasing Sh20 billion to a bankrupt contractor, especially when we cannot pay local contractors on time? Why the urgency?

Is complying with the terms of a commercial agreement with a bankrupt Italian company a higher calling to the National Treasury than protecting the interests of the taxpayer?

Is it not the height of irony that the National Treasury was moving with alacrity to pay the bankrupt Italians billions of shillings despite the fact that the Kenya Forest Service was yet to de-gazette the land on which the dams were to be built?

Clearly, cracking the motive behind the speed at which billions were released to the bankrupt Italians must be made the core of Mr Kinoti’s investigations.

RESETTLEMENT

As we all know, the process of paying land compensations will drag for a long time. Resettling individuals displaced by the dams is even more complicated.

With the government struggling with the pressure of a high public wage bill, and in the context of dwindling tax collections, I don’t see how these dams will be a priority going forward.

Call me a conspiracy theorist if you like but these dams were conceived to facilitate release of kickbacks and backhanders.

I hear them talking about guarantees and bind bonds. Who, in his right mind, can believe that a bid bond from an Italian company in the middle of bankruptcy negotiations with creditors is worth the piece of paper on which the guarantee is written?

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