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Ex-deputy Auditor General among 6 arrested over Sh100m tender

By Hillary Orinde | October 18th 2019
EACC CEO Twalib Mbarak (left) and Director of Public Prosecutions Noordin Haji at a past event. They have been investigating the alleged irregular procurement at the Office of the Auditor-General. [File, Standard]

The Ethics and Anti-Corruption Commission (EACC) today arrested six people over an inflated software tender in the office of the Auditor-General.

The six among them former deputy Auditor-General Stephen Ndungú Kinuthia are accused of buying an audit vault software at Sh100,675,680 against its estimated cost of Sh18 million.

The software is used to audit financial transactions using the Integrated Financial Management Information System (IFMIS) platform. 

It is the system that is touted had helped to detect the Sh791 million scandal at the National Youth Service (NYS) in 2015.

EACC boss Twalib Mbarak said the software was purchased from Open Systems Integration (OSI) Kenya on November 7, 2013, through direct procurement who purported to be the only accredited partner of Oracle to supply the software.

“The commission established that there was no justification for single sourcing, the payment was grossly exaggerated and that out of Sh100m paid out, only Sh36m was legitimately paid to Oracle for the Audit Vault Software,” Twalib said.

The balance of Sh64 million was allegedly paid as kickbacks to public officials, private persons, and their associated companies.

According to a 2018 suit by EACC Stephen Kinuthia allegedly received Sh27 million in kickbacks out of which he used Sh13 million to buy three prime plots in Makuyu Town.

Twalib added the Director of Public Prosecutions had reviewed the file and okayed the prosecution of the accused.

"Upon completion of the investigations, the file was submitted to Director of Public Prosecutions Noordin Haji who upon review has granted consent to charge 24 individuals and entities," Twalib said.

Six of the 24 are already in police custody. They include former deputy Auditor General Stephen Ndungú Kinuthia, the ICT Director in the Office of the Auditor-General Justus Ongera and IT manager Annette Mwangi.

Others are Desmond Irungu Kinuthia and Nelson Karanja Kinuthia, both directors of Enkei Holdings Limited and Charles Mbugua Njuguna of Njuguna and Partners.

The anti-graft watchdog has summoned the following to present themselves at Integrity Centre immediately;

  1. Charles Githinji Gichobi - Sales Executive, Oracle Systems Kenya Limited
  2. Ephantus Kairu Kahwae -Non-Executive Director, Open Systems Integration Kenya
  3. Sylvester Kiptoo Kiplagat - Non-Executive Director, Open Systems Integration Kenya
  4. Patrick Shem Kamau Maina - Managing Director, Open Systems Integration Kenya
  5. Charmine Kinuthia, Director, Enkei Holdings Limited
  6. Charles Mwaduna - Director, Mars Technology Limited
  7. Edward Mulewa Mwachinga - Director, Mars Technology Limited
  8. Jane Wangui Kinuthia - Director, Nanazi Investment Limited
  9. Florence Waithira Kinuthia - Director, Nanazi Investment Limited

They will be charged with conspiracy to commit an economic crime, conflict of interest, unlawful acquisition of public property, dealing with suspect property and money laundering.

They are expected to be arraigned on Tuesday.

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