I’m clean, Kenya Pipeline Company boss says on fraud claims

Kenya Pipeline Company Limited Chairman, John Ngumi, during an interview on Thursday April 26 2018 [David Njaaga, Standard]

Kenya Pipeline Company (KPC) Chairman John Ngumi says he has not been contacted by any investigative body in Kenya or Tanzania over claims linking his name to a controversial financial transaction in Tanzania.

According to Ngumi, the Serious Fraud Office, a UK government department that investigates and prosecutes big fraud and corruption cases, never mentioned or contacted him in their investigation that led to fining of those found culpable.

“I have had to spend hours explaining to friends, family, colleagues and media that I am not a crook, fugitive or thief. It is a distraction. It is expensive and annoying,” Mr Ngumi told Weekend Business.

He said he was not in any way involved in the $600 million (Sh60 billion) private placement bond of 2013, which was undertaken by London-based Standard Bank PLC and Stanbic Bank Tanzania on behalf of the Tanzanian government.

“The agreement was between the Tanzanian government and Stanbic Bank of Tanzania together with Standard Bank PLC, without the involvement of Stanbic Bank Kenya office,” said Ngumi.

The deal turned painful for the two banks after a case filed by the Serious Fraud Office found them guilty of misconduct. It cost Standard Bank $32 million (Sh3.2 billion) as it surrendered all fees earned and was slapped with a financial penalty.

The two banks had negotiated to help Tanzania raise the money, initially at 1.4 per cent but this was raised to 2.4 per cent as they mysteriously brought on board a third party called Enterprise Growth Markets Advisors Limited.

This firm pocketed $6 million (Sh600 million) from the deal.

Not party

Ngumi, who at that time was the head of investment banking coverage in East Africa for Standard Bank Africa, says unlike in 2011 when he was a sole arranger for a Tanzania debut loan of $250 million (Sh25 billion) priced at 1.4 per cent, he was not party to the private placement made in 2013.

Not involved

He said nobody in the Tanzanian bank used to report to him and dismissed reports that he is wanted in the neighbouring country, that he is ready to go there should any official be interested in questioning him.

“Where is the legal process that says the Tanzanian government wishes to have me extradited?” he posed.

”If any authority calls me and says they are still interested to know about the deal, I will get on the plane. I don’t have a problem.”

In April 2017, the Tanzanian government asked Kenya to extradite former Stanbic Tanzania boss Bashir Awale to face charges. Mr Awale was mentioned in the Serious Fraud Office report.

However, nowhere is Ngumi’s name mentioned in the 55-page document.

The KPC chairman, now serving his second term, said he is reading a witch hunt in the timing of the allegations linking him to fraud.

“I was reappointed as chairman of KPC on April 6. Maybe somebody is not happy. I don’t know,” he said.

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