By JOSEPH MASHA
Central Bank of Kenya’s (CBK) anti-fraud body has launched investigations into a fraud case involving the loss of over Sh5 million in Bahari constituency development fund (CDF).
The inquiries, being led by a senior investigator at CBK’s anti-banking fraud unit, Mombasa branch, began a few weeks ago after the incident was exposed.
Kilifi district accountant Mr Julius Mchoi, a signatory of the CDF bank account at the Kenya Commercial Bank (KCB) blew the whistle after he allegedly discovered that something wrong was going on.
Mchohi told The Standard he was the first person to expose the scam that promoted action by CBK’s anti-fraud unit.
“It’s true the fraud case is under probe. I discovered the abnormality before informing the concerned parties,” said Mchohi.
Sources from Bahari’s CDF office revealed some people, among them staff, forged signatures of the fund’s officials and opened accounts with two banks in Mombasa.
According to Mchohi, the accounts were used to siphon cash from the CDF kitty, adding this activity started in April and was brought to light in June this year.
Bahari CDF Manager Andrew Lumunge said several cheques were used to withdraw money totalling to about Sh5.1 million.
“By the time the trend was discovered, the fraudsters had taken about Sh5.1 million, with withdrawals being made from two different bank accounts in Mombasa,” said Lumunge.
Sources at Bahari CDF offices indicated that a member of staff colluded with other people to con the taxpayer.
CBK’s anti-fraud agency has pinpointed suspects from the fund for interrogation as investigations are ongoing.
A senior CDF official who sought anonymity said the deal was an inside job as those suspected are staff who gave specimen signatures of the kitty’s bank accounts.
The Standard was further informed that some cheques books that had been collected at the Kilifi commercial bank got lost before the fraud was reported.
It was said that apart from the official CDF bank which is KCB, the fraudsters opened their own bank accounts with other banks in Mombasa before the looting started.
The district accountant, who declined to comment much on the issue, said he came to discover about the scandal when he was making his monthly banking reconciliations.
“In the accounting sector, we normally conduct our monthly banking reconciliations to balance our figures and it was through that process that I came to discover the fraud,” said Mchohi.
According to Lumunge said the suspects recorded ghost community projects and made withdrawals to fund them.
