E-Clips:- Business Pictorial - Big Names Missing From Graft File

Names of the principal architects of the Sh7 billion Anglo Leasing Finance scandal are conspicuously missing from a file to be forwarded to the attorney-general by graft busters, we can reveal today.

They have recommended the prosecution of three former permanent secretaries and an official of the Office of the President who reportedly signed the twin contracts with a shadowy company. But the file doesnt contain a single name of those who negotiated the deals or those who were paid a commitment fee of Sh900 million by the Treasury.

In the bulky investigation file to be forwarded to Mr Amos Wako, the Kenya Anti-Corruption Commission has recommended that action be taken against former permanent secretaries Joseph Magari (Treasury), Sylvester Mwaliko (Home Affairs) and Zakayo Cheruiyot (Internal Security) and Mr J.F. Agiri of the Presidents Office. Addressing senior investigators recently hired by the commission, Mr Justice Aaron Ringera said the Anglo Leasing probe was complete and the file would be handed over to the attorney-general.

Mr Wako yesterday pledged to prosecute corrupt individuals, "no matter their position in society", and "decisively, diligently and professionally" deal with corruption cases "to the satisfaction of Kenyans and the world". He expected to receive the file on Anglo Leasing this week and would prosecute the culprits expeditiously. "Kenyans should watch my moves in a few days and they will be happy."

However, the AG said he regretted that some cases forwarded to his office by the Kenya Anti-Corruption Commission lacked evidence to sustain "a successful charge" in court. Sources in the Anglo Leasing investigation said the four individuals to be charged were only pawns in the game, and the big names behind the fraud bid remained protected.

Questions were being raised as to why Kacc investigators were unable to get a senior security officer, a well-connected State House operative and a top legal officer who may have played a key role. Highly-placed sources in Government said that only people with a firm control over state machinery could effectively cover up a scandal the size of Anglo Leasing.

These questions remain answered:

* Who are the Government officials who negotiated and signed the contracts?

* Who were paid the commitment fee and who authorised a Swiss bank to wire back the money to Central Bank of Kenya when the scandal was exposed in Parliament?

* What role did the powerful figures in State House, Treasury, the National Security Intelligence Service, the Office of the President and the Attorney-Generals office play in the deal and the subsequent cover-up?

* Why has a cartel of briefcase businessmen who initiated the deals during Mois era and revived it under the Kibaki administration not been arrested or prosecuted?

Kacc officials defended themselves saying attempts by their investigators to uncover the masterminds had run into a wall of silence. Investigators from the Kenya Anti-Corruption Commission have failed to trace and question two foreigners who may hold the key to unlocking the biggest scandal in the Kibaki administration.

Both the managing director of Anglo Leasing, Swiss businessman Michel Gruring, and a US businessman who used to live in Nairobi, Dr Merlyn Kettering, who was a consultant for Forensic Laboratories – one of the companies involved in the fraud – are crucial to shedding light on the affairs but police said they had been dodging the investigating team. The two anti-corruption investigators who last year went to France, Germany, the Netherlands, Switzerland, the UK and the United States failed to trace either Mr Gruring or Dr Kettering.

The investigators have failed to unearth the people given a downpayment for the contracts nor those who hurriedly ordered a Swiss bank to wire back the money after the scandal was uncovered. The shadowy firm was paid a huge commission but the money was promptly returned when the matter exploded into public glare, leading Justice minister Kiraitu Murungi to declare that Anglo Leasing was "the scandal that never was".

Sources said the first batch of people taken to court will be charged with abuse of office and not an attempt to defraud the Government. Anglo Leasing and Finance Company entered into two contracts with the Moi and Kibaki governments for work that was not even started. The first contract was to supply a terrorist-proof passport system for the Immigration Department for Sh2.7 billion, while the second was to build forensic science laboratories for the CID at a cost of Sh4 billion.

The passport scandal was the first to be exposed in Parliament on April 2, 2004. The deal involved a Sh800 million project in the ministry of Home Affairs for the issuance of tamper-proof passports under the Moi administration. The project was revised when Narc took over and it was now to cost Sh2.7 billion. Payments were approved and made without parliamentary approval.

The forensic laboratory scandal was brought to public knowledge by Mr Magari. The project was the construction of forensic laboratories for the Criminal Investigations Department at Karura, Nairobi. The contract was awarded by the Moi government and a commitment fee of Sh900 million paid. The money was secretly wired back when the scandal was exposed.

Despite the fact that no work had been done, when the Narc government took over, the Office of the President revived the project and Treasury paid another Sh241 million. The project fell under the Office of the President where Dr Chris Murungaru is the minister and Mr Dave Mwangi the Permanent Secretary. Following a public outcry over the sandal last year, President Kibaki sacked Mr Magari, Mr Mwaliko and several senior officers in the Treasury and the Attorney-Generals chambers.

Permanent secretary Cheruiyot was already out, dropped by President Kibaki soon after he took over from President Moi in December 2002. Sources in the Government yesterday told the Nation that Kacc had recommended action be taken against Mr Magari and Mr Mwaliko over the passport scandal and Mr Cheruiyot and Mr Agiri over the laboratory scandal. Apart from Magari and his group, two local businessmen, Mr Jimmy Wanjigi and Mr Deepak Kamani, were named in Parliament as being linked to the deal. They have also been interviewed by the Kacc officials.

A former development consultant for the US government and a business associate of the Kamani family, Dr Kettering slipped out of Kenya when the scandal was exposed and he has not returned. Mr Kamani is reported to have left the country about four months ago for what his lawyer said was a business trip to India. He was expected back this month. Dr Kettering was also a consultant for the computerisation of Kenya Airports Authority in the late 1990s.

The company handling the job, Dyntech, has an address at Fulwood Park in Liverpool, the home of the late Mr Ashwin Ruparell, according to records in Companies House. Mr Ruparells wife, Sudha, a 47-year-old Kenyan, owns Saagar Associates of Liverpool, which acted as Anglo Leasings agent in the UK. It was Saagars accounts manager, Colin Flynn, who signed both contracts; for the passports and the laboratories.

Mrs Ruparell, who has recently moved back to Kenya, is the daughter of Mr Chamanlal V Kamani, a 72-year-old multimillionaire patriarch of a business family which enjoyed close links with senior officials in the Moi government. The family, through their company, Kamsons Ltd, was responsible for the import of Mahindra jeeps from India for the police in the 1990s. Their poor performance turned the police into a laughing stock.