NHIF theft worse than murder, DPP tells court

NHIF CEO Geoffrey Mwangi. [File, Standard]
Public prosecutors yesterday told a court how National Hospital Insurance Fund top managers turned a blind eye as Sh1 billion was being looted.

The prosecution claimed the managers disregarded procurement laws and illegally approved payments worth millions of shillings to a company that provided an integrated revenue collection system.

Former NHIF Chief Executive Officer Simeon ole Kirgotty, his successor Geoffrey Mwangi, Legal Affairs manager Ruth Makallah, Procurement Manager Pamela Nyaboke and two directors of Webtrite Ltd; Danson Muchemi and Robert Muriithi were yesterday charged with theft.

“The economic crimes they committed are (a) class apart and worse than murder. We are talking of money lost which was meant for the poor sick and given that there are people who might have lost their lives because they could not access the funds,” prosecutor Emily Kamau said.

The six were charged alongside NHIF board members Mudzo Nzili, Yussuf Ibrahim and Elly Opot. Other staff who were also in charged were Joseph Mbuvi, David Nzuki, Gibson Kamau, Irene Rono, Jacinta Mwangi, Gilbert Kamau, Kennedy Wakhu, Fredrick Onyancha, Millicent Mwangi, Matilda Mwangemi and Darius Mbogo.

According to the charge sheet, the theft started between February 7, 2014 and August 15, 2014 when Mr Kirgotty, Mr Mwangi, Ms Makallah, and Ms Nyaboke entered into a contract worth Sh49,513,440 with Webtrite Ltd for provision of integrated revenue collection services without prior planning.

The prosecution said the NHIF tender committee consisting of Ms Rono, Ms Mwangi, Mr Kamau, Mr Wakhu and Mr Onyancha failed to check whether the contract awarded to Webtrite Ltd met the set requirements.

“On May 14, 2014 at NHIF headquarters being members of the tender evaluation committee, they wilfully failed to comply with the law relating to procurement by failing to adhere to procedure and criteria set out in the tender documents in evaluating the submitted bids,” charge sheet partly read.

On May 29, 2014, the tender committee was again accused of failing to review, verify and ascertain that procurement was undertaken in accordance with the terms set out in the tender documents for the supply of integrated revenue services.

Count four stated that this gave way for Kirgotty to allegedly abuse his office as CEO and accounting officer on August 15, 2014 by awarding Webtrite Ltd a contract for provision of integrated revenue collection services and authorise payments worth Sh49.5 million.

Between August 15, 2014 and June 30, 2017, Webtrite Ltd was paid Sh545,557,719 in commission, allegedly with Kirgotty’s blessing, the prosecution added.

The prosecution stated that the procurement flaws at NHIF further helped Kirgotty to break procurement laws by authorising another payment of Sh595 million to Webtrite Company Ltd.

Mwangi, who at the time was the finance general manager, was also accused of using his office to approve unlawful payments to Webtrite Ltd, something he allegedly continued to do when he assumed the top office.

To ward off competition from other companies, Mwangi is accused of extending Webtrite Ltd’s contract without following procedure.

“Between September 6, 2017 and February 13, 2018 at NHIF being the CEO, (Mwangi) used (his) office to confer a benefit of Sh260 million to Webtrite Company Ltd by extending an expired contract,” read the charge sheet.

On June 4, 2018, the CEO, corporate secretary, supply chain manager and finance general manager were again said to have awarded Webtrite Ltd a Sh495 million contract for provision of integrated revenue collection through single sourcing.

The prosecution accused senior systems administrator and internal auditor of making false entries in payment vouchers purporting that services had been rendered.

Nzili, Ibrahim and Opot - being members of the NHIF audit committee - were accused of breach of trust by failing to disclose material facts in regard to extension of contract for provision of integrated revenue collection services thereby occasioning loss of Sh200 million.

In total, Webtrite Ltd and its two directors were accused of fraudulently acquiring public property totalling Sh1,103,060,853 from NHIF between August 15, 2014 and October 31, 2018.

They all denied the charges and Anti-Corruption Court magistrate Douglas Ogoti released Kirgotty, Mwangi, Muchemi and Muriithi on Sh2 million cash bail each.

Makallah, Nyaboke, Muhuhu, Mwangi, Kamau, Wakhu, Ibrahim, Nzili and Opot were each released on Sh1 million cash bail, while Wangui and Mwangemi were granted Sh500,000 cash bail.

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