NYS scandal entangles Treasury Cabinet secretary

Former Cabinet Secretary Ministry of Devolution Ann Waiguru ( from left ) Senior Director General Adan Gedow Harakhe and the National Youth Service Director Dr Nelson Githinji when they appeared before the National Committee on Labor,Social Welfare and Finance at Parliament Building 07/07/15 PHOTO MOSES OMUSULA

Adan Harakhe walked into his office at the National Youth Service (NYS) as usual one Wednesday morning last year.

Mr Harakhe, the senior deputy director general at the NYS, was on very good terms with the then Devolution Cabinet Secretary Anne Waiguru at the time.

As he sat at his desk and switched on his computer to check the Integrated Financial Management Information System (IFMIS) system, he found a reason to smile.

Besides the billions NYS had received that year, Treasury had just wired Sh3.5 billion to its accounts the previous day—May 19, 2015. The money was part of the supplementary budget approved for the agency that year.

But there was something was wrong. Just hours after the money hit the account, several commitments had already been made. Between May 20 and 21, at least 21 transactions valued at Sh828 million had been approved for payment through the system.

Shockingly, the system indicated that the transactions were approved by him, which he denies. He decided to report the matter to the Criminal Investigations Department (CID).

His first mistake was to make the report through a phone call. The CID advised him to put it in writing. The next Monday, the Chief Finance Officer at the NYS, a Mr Nixon Oborah gave him an analysis of the transactions and it is at that point that the depth of the scam started to unravel.

The following day, Harakhe instructed the person in charge of ICT to write to the CID to request the cyber crime unit to "assist in establishing the people behind those transactions done fraudulently".

That was when Harakhe sent his official vehicle to pick the CID officers to come and investigate him on May 26, 2015. Immediately word went round, he was called by his principal secretary at the time and the NYS Director General and advised against involving the CID in the investigation.

"The PS, further instructed me to tell the CID officers who came for the investigations that we would handle the matter departmentally and to see him the following morning at 7.00 am in his office without fail. The Director General gave me the same advice," Harakhe says in the exhibit presented by embattled former Devolution Secretary Anne Waiguru to back claims in her affidavit.

Harakhe called Chief Inspector Kipruto of the Cyber Crime Unit and called off the investigation. He was in the PS's office the following morning as advised at 7am. As a sweetener, the PS allegedly told him he had recommended that the Public Service Commission creates the position of senior deputy director general, and that he be appointed to the position.

"He said go slow on this transactions it will put you in trouble. Those commitments were for materials supplied. Those payments were for companies associated with CS Rotich who assisted us to get the funding and other wazees," Harakhe is quoted to have said in the documents by Waiguru.

The PS then allegedly told Harakhe that he would introduce him to a young man by the name Ben. He was to sit with him and agree on the best way to "finalise these issues". He also gave Halakhe Ben's cellphone number.

"Ben was called to the office and we were told to discuss and rest the issue."

Arrogant Man

Harakhe describes Ben as an arrogant man who used big names to intimidate him. "He alleged to be the point man for the Cabinet Secretary, Mr Henry Rotich, who is a high flyer of His excellency the deputy president," Harakhe adds.

Ben also claimed that the CID director was his friend. Rotich did not respond to our text messages on the issue and had not returned our phone call by the time of going to press yesterday. But in an earlier interview with this newspaper, Rotich said he did not know any of those companies.

"You are from the field, we shall teach you how to survive in the city and government offices. Allow those transactions to go through and we shall take care of you," Ben, he says, told him.

At this point, the PS said he was leaving for Arusha, having established that the two were proceeding well with their conversation. But after the PS left, Harakhe claims that he told Ben he was going to reverse the transactions because he had no knowledge of the materials supplied and that his password had been hacked.

But Ben told him that he would make it difficult for him to cancel them. That was when Harakhe escalated the matter to the director of IFMIS, Jerome Ochieng.

"Mr Jerome told me that I was creating unnecessary confusion and the wording of the letter I wrote was not good," Harakhe adds. Mr Harakhe narrates a harrowing and frustrating account and the stops he had to pull to reverse the fraudulent transactions.

At first, he was assigned two officers at IFMIS to help him with the process of cancellation. But when they logged onto the system, it indicated that none of the lines on requisition were eligible for cancellation.

"Change request cannot be submitted because the user is not the preparer of the requisition," the system reported. Harakhe alleges that he then texted this outcome to Mr Jerome since he was out of office. Jerome replied that he was in a meeting. He then called the PS and informed him of his challenges but the PS replied 'shauri yenu".

As a last attempt, Harakhe texted the Director General, but he too was 'equally unco-operative" and he chastised at him.

"The IFMIS Director, Mr Jerome Ochieng, and two of his staff Kyalo and Susan were very unco-operative and asked the CID officers to call me," he says.

Harakhe went to Treasury accompanied by one of his staff members to meet the CID officer in the IFMIS boardroom. The two staff members at IFMIS, only identified as Kyalo and Susan, joined him in the boardroom.

In the boardroom, Kyalo allegedly called someone and he was heard disputing the supplementary estimates wired to the NYS. He further blamed Harakhe for making unnecessary complaints that he could not prove.

"I explained to him that I use the online system, manual documents, LPOs, LSOs and registers that I sign after approval in the system and asked him what was his problem," Harakhe narrates.

He said "bring all those documents." Harakhe sent his driver to bring the documents. Then Kyalo allegedly said that he wanted to talk to Harakhe in private.

The two went to the 10th floor office of a Mr Muchiri who was on leave. In the office, Kyalo asked Harakhe to tell the CID officers to cook something in a way that would convince the CS.

"He asked me to tell these CID officers to cook something in a way that would convince the CS and not to victimise others and we would look after them."

Harakhe says he told him he was the complainant in that case and he could do that himself. The documents were then brought and he asked Kyalo if they could go back to the boardroom.

"He said he would consult his bosses. He and Jerome (Ochieng) left the Treasury Building. I told the CID officers what Kyalo had said."

About ten days after that aborted meeting, the then PS called Harakhe at around 6pm in the evening. The PS asked Harakhe to meet him at the Nakumatt Junction in an hour. Harakhe went for the meeting in which he also met Ben again.

He alleges that the two threatened him, calling him a stumbling block. They warned that if he didn't co-operate, they would fix him. One option of fixing him was through the CID, by them confirming the status that he approved the transactions and second the suppliers would take him to court.

 

"I told them that the truth will always prevail," Harakhe says. The PS then asked him to go to his office the following morning, June 15, 2015, for him to write a letter allowing Harakhe to cancel Sh200 million out of the total figure in dispute and regularise the remaining ones. He was instructed to then lie to Waiguru that he had cancelled all the transactions.

Harakhe went to the office as planned the following morning. The letter was written as agreed and he went with it to the IFMIS director's (Ochieng) office. Ochieng then asked for the details of the transactions he wanted cancelled. Harakhe said he wanted all the transactions de-committed (cancelled).

But the reverse request was turned down one more time by the system. The cancelling only happened after Waiguru allegedly intervened through a phone call on the night of June 17, 2015. Harakhe went to Treasury the following morning and the cancellation request was granted but he was required to do it in person and not through others.

Through the assistance of two other officers, Harakhe finally managed to cancel all the transactions he had disputed. At this point, Harakhe thought that the nightmare was over. That was until he received a short message the following week. The message had just six words. "Call me back. Are you okay?"

On an ordinary day, Harakhe would never have ignored such a message. Especially if it was coming from the Leader of Majority in the National Assembly Adan Duale. Mr Duale was not an ordinary Member of Parliament. He was at the time seen as the official spokesman of the Government in Parliament.

Anything he said was taken as the President's position on any subject unless the President came out to dispute it. But events of the previous weeks had emboldened him. He ignored the message. He never called him. But Duale called him back the same day and reprimanded him.

Harakhe documents this on a memo written to Waiguru on July 10, 2015. "He (Duale) asked what was wrong with me, because this is a political government and I require political support from the leader of where I come from," Harakhe says.

Duale did not waste time. He allegedly reminded Harakhe that politically, the leaders in government from the region were all in the URP – the party led by Deputy President William Ruto.

"You will be used by the other side of the coalition and dumped," Duale allegedly told Mr Harakhe on phone.

And to make the point clearer, Duale reportedly added: The other side have even sponsored a bill in Parliament to reduce funding for our region, and the curfew imposed on our people is instigated by them."

Duale finished the phone call by asking Harakhe to look for him that weekend for more advice. "I told him I had no problem with this issue, and would let the investigation establish the facts, and thanked him for his concern," Harakhe says.

However, he never looked for Duale at all. But that was not the end of the political pressure. He received, he says, another disturbing call almost 20 days later on July 8, 2015. This time, the call was from Senator Kipchumba Murkomen, a man who has cut himself out as a strong defender of the deputy president and one of his most trusted allies.

Mr Murkomen allegedly informed Harakhe that he had been sent by the then PS on a "very urgent issue". He asked Harakhe to visit him in his office in Hurlingham, but he also did not honour this invite.

The following day, Murkomen called him several times but he refused to pick the senator's calls. Then, Murkomen took matters into his own hands.

DP's younger brother

"At noon Senator Murkomen visited my office in the company of a person he introduced as Luke Kimutai Samoei, the younger brother of His Excellency, the Deputy President," Harakhe says in the memo.

The senator asked, "Has the PS explained to you the reason why I am looking for you?" He further said the de-commitment I made was for materials supplied and the merchants were complaining.

"The CID was also used to close bank account of my friends' client," he said. Harakhe maintains that he explained to the senator that hackers had used his password to do the commitment.

Harakhe told the senator that the issue of the closure of the bank account was beyond his purview and that he could visit the CID to seek answers.

Murkomen is said to have agreed to visit the CID headquarters. "Luke Kimutai Samoei requested for business for his company by the name Equity Tech Ltd. He said I should be biased in giving 'good work'."

The senator then requested for a much closer working relationship and a meeting with Harakhe outside the office for more discussions. He escorted Murkomen to his car, and found that the former Acting Director of the Youth Directorate, Stephen Jalenga, was waiting in the senator's car.