Police have revealed that they froze the bank accounts of 13 firms said to have received Sh121 million from the National Youth Service (NYS) following allegations of fraud.
The firms operated three accounts - two at Consolidated Bank and a third one at Barclays Bank of Kenya - that were frozen on April 26 following a court order.
The Directorate of Criminal Investigations secured the freezing order through an affidavit sworn by Police Constable Kenneth Kemei, who told Nairobi Chief Magistrate Francis Andayi that they were conducting a probe on the three accounts.
Mr Andayi then issued the orders requiring the two banks to preserve any monies held in the accounts for 90 days pending the outcome of investigations.
The order also required the banks to provide the investigators with account opening documents, inward and outward remittances documents/instructions, SWIFT/RTGS, deposit and withdrawal slips, and cheques from inception to date relating to the accounts.
The freezing now corroborates a statement by the Ministry of Public Service, Youth and Gender Affairs that only 13 vouchers worth Sh121 million, and not Sh8 billion, were being investigated by a multi-agency team led by the DCI.
According to a brief prepared by Principal Secretary Lilian Mbogo-Omollo to Cabinet Secretary Margaret Kobia, all vouchers forwarded to the DCI for investigations amounted to Sh900 million rather than Sh8 billion as touted by National Intelligence Service (NIS) Director General Philip Kameru.
“The allegation made that there are 13 vouchers amounting to Sh8 billion paid to non-existent companies for non-existent supplies for NYS is incorrect. The total amount paid against the alleged vouchers is Sh121 million as per the statement signed to DCI by the PS on 2nd May,” Ms Omollo said.
Yesterday, it also emerged that Auditor General Edward Ouko had cleared the department of any queries in his 2016-2017 financial year audit despite having said in the previous year that he could not unravel the mystery of billions spent by NYS then.
“As required by Article 229(6) of the Constitution, based on the audit procedures performed, I confirm that nothing has come to my attention to cause me believe that public money has not been applied lawfully and in an effective way,” Mr Ouko said in his 2016-2017 report on the State Department of Public Service and Youth.
“Key audit matters are those matters that, in my professional judgement, are most of significance in the audit of financial statements. Except for the matter described in the basis for qualified opinion section, I have determined that there are no key audit matters to communicate in my report.”
During the year in review, the department reported that pending bills from previous years stood at Sh2,964,606,488 as at June 30, 2017, while bills totalling Sh2,505,894,057 were not settled during the 2015-2016 financial year.
During the 2015-2016 financial year, when the State department was under the Ministry of Devolution and Planning, Ouko stated that he could not verify the veracity of more than Sh830 million paid to 16 firms after documents were seized by investigating agencies such as the Ethics and Anti-Corruption Commission, DCI and Banking Fraud Investigations Unit.
Kirinyaga Governor Anne Waiguru was then the Devolution Cabinet secretary while Peter Mang’iti served as the principal secretary for Planning.
“Payment vouchers and supporting documents for amounts totalling Sh831,968,731.35 as detailed below were reportedly seized by investigating agencies and were, therefore, not made available for audit review,” the report stated.
The list of firms and what they were paid include Out of the Box Solutions Ltd (Sh90.7 milliom), Blue Star (Sh45.1 million), Fahaza Ltd (29.1 million), Lukenya Earthmovers EA Ltd (Sh118.3 million), Greenberg Holding Ltd (Sh79.8 million) and Brandspark Supplies Ltd (Sh19 million).