Report tabled by Nairobi County assembly reveals 31 bank accounts set up in dubious manner

The city assembly in session. A committee of the assembly is probing the county administration over some bank accounts.[File, Standard]

The city county government is now under probe after it emerged it was operating over 20 bank accounts unknown to Members of the County Assembly.

Budget and Appropriations Committee chairman Robert Mbatia, through a report, revealed Nairobi County had a total of 31 bank accounts and that some seemed to have been set up in a flawed manner.

The report tabled last week revealed four of the accounts were held at the Central Bank of Kenya, with another 27 being held at different commercial banks. City Hall has 15 accounts at Cooperative Bank, two accounts at Equity Bank, seven at National Bank, two at Kenya Commercial Bank and one at Chase Bank. At Central Bank, it has the Development Account, Road Maintenance Account, Revenue Account and the Recurrent Account.

Investigations

The chairman yesterday stated that investigations had begun to try and establish how the county executive opened some of the accounts without its approval.

“There seems to be a duplication of the accounts and we have asked the executive to give facts so that we can establish what activities have been done with the accounts,” stated Mr Mbatia.

The budget chairman further questioned the necessity of all the bank accounts, observing that according to the law, the city government was only supposed to have two main accounts. According to the Public Finance Management Act of 2012, the county should have a Development Fund account to receive money from Central Bank for development and a Revenue Fund account for receiving disbursements from the Exchequer and internal revenue.

However, it further provides that the executive has the authority to open other accounts to serve the county’s needs provided it is approved by the county assembly or pegged on a legislation.

 “It is true that we need some of them but why are there so many bank accounts? We have asked the executive for more information on the accounts that were already reported to the County Assembly and those that were not so that we can ascertain on whether they are legal,” added Mbatia.

Dormant accounts

Interestingly, the report brought to the fore that some of the accounts were dormant or with few transactions and others were used ‘when need arises.’

“Some of the accounts were inherited by the former regime from the City Council but they continued operating them,” he said.

Speaking to the Metropolitan on phone, Mbatia, however, clarified that the revelation was also shocking to the current administration which was now digging to establish the facts behind the creation of the said accounts. The report was tabled in response to a statement requested by Woodley MCA Mwangi Njahia.

He sought to know the number of bank accounts and bank reconciliations of the county in the financial year 2016/17.

Mr Njahia was concerned that the accounts could have been used by some unscrupulous individuals to siphon funds meant for service delivery.

“I fail to understand why the county has too many accounts. Also, only two of the reconciliations were signed out of the 31, which raises a lot of questions,” he stated.