Githongo - Mwiraria Played A Key Role East African Standard 02 February 2006 Page: 2
Former Finance minister David Mwiraria "played an integral role" in Anglo Leasing and related scandals, contrary to his cry of innocence. In a statement released from the United Kingdom on Wednesday evening, former Ethics Permanent Secretary, John Githongo, said he had evidence that Mwiraria played a role in the scams and no impartial and independent inquiry could reach a contrary conclusion.
"I want to categorically state that evidence in my possession conclusively proves that Mr Mwiraria was an integral player in the Anglo Leasing scandal and related scams. No impartial and independent inquiry can reach a contrary conclusion," said Githongo. Githongo, whose report to President Kibaki on grand corruption in his Government has caused a fresh storm, was reacting to Mr Mwirarias resignation letter, in which the former minister proclaims his innocence. Mwiraria stated he was not party to any irregularity, criminal and unethical conduct and asked Kibaki to expedite investigations into the matter to clear his name.Full proof evidence
Githongo, who is a Senior Associate Member at St Antonys College, Oxford University, has remained in the UK since February last year, when he resigned abruptly at a time when the Government was trying to sweep the Anglo Leasing scandal under the carpet.His statement was accompanied by another from his legal and political advisor, Prof Makau Mutua, who said he had studied Githongos evidence and found it full proof.Mutua states: "From the legal point of view, the evidence is conclusive, damning and overwhelming with respect to those who have been implicated in the scandals".Githongo has been invited to testify before Parliaments Public Accounts Committee. On Wednesday, he said he would present himself before the team once they agreed on the logistics.
"I am discussing with PAC the terms and conditions of my appearance, including timing and place, as well as scope of my testimony," stated Githongo. He said he had also accepted to help the Kenya Anti-Corruption Commission to solve the scandal, which has dogged the Government for the last three years."I have accepted, a request by Aaron Ringera, the director of KACC, to offer his Commission information with respect to Anglo Leasing," said Githongo.Controversial projects
David Mwirarias name features several times in the report on corruption to the President by Githongo. He was one of two Cabinet ministers who linked President Kibaki to Anura Perera, the man said to be behind the Sh4.1 billion Navy ship project and other controversial projects, according to the report. The ministers dropped Pereras name as they put pressure on Githongo to release payments for contracts he had questioned.On one occasion, Mwiraria reportedly told Githongo that Perera was a good and generous man, whose relationship with the President went back a long way.
The report, selected sections of which were released to the media recently, quotes Githongo as saying Mwiraria had told him that Perera had paid Kibakis hospital bill when he was hospitalised in London in the run-up to the 2002 general elections.The minister reportedly told him this on March 28, in Mombasa, where a conference on money laundering was taking place.According to Githongo, Mwiraria pulled him aside during the break and said Hon (Chris) Murungaru had called. Apparently Murungaru asked whether he had authorised an investigation into the bank accounts of an individual named Anura Perera.
"Mwiraria informed me that Perera was a strong supporter of the President and had backed him for over 10 years and had even paid the Presidents medical bills following his road accident in 2002."Head of Banking Fraud Department of the Central Bank, Nicholas Kamwende, confirmed that indeed he was conducting such an investigation because his department suspected (the bank) was involved in the setting up of fictitious accounts that were being used for capital flight.
Money returned In the letter accompanying the report, Githongo says he has "incontrovertible evidence that senior most members of our government" were involved in the questionable deals.There are reports that his conversations with the ministers are on tape. Mwiraria is also mentioned among politicians, Government officials and businessmen whose names featured in the initial investigations into the passports contract scandal in April 2004. The others at this stage were Vice President Moody Awori, former minister Chris Murungaru, former PS Home Affairs Sylvester Mwaliko, PS Internal Security David Mwangi, Alfred Getonga, Deepak Kamani and Jimmy Wanjigi.
Githongos report also features the then minister as "expressing hope that the investigation would stop since Anglo Leasing Finance had returned the money paid to them over the passports contract.And later, it is Mwiraria who informed Githongo that the firm had returned some more money: "Just as I put down the phone, Hon David Mwiraria stepped into my office and announced that Anglo-Leasing had paid back all the money they had paid on the Forensic Lab Contract since 2001. Hon Mwiraria claimed to have spoken to your Excellency the President and claimed that you felt we needed to "go easy" on the matter since the money had been paid back and if it came to public light that there was another corrupt deal of this magnitude in our administration, this would cause problems."Money owed
Githongo also quotes Mwiraria as informing him that the forensic laboratories "payback" of Sh400 million had been made only after he (Mwiraria) had asked (Finance Officer Joseph) Oyula to pick up the phone and call Deepak Kamani."It was after this call that the money was then returned. To me this was a startling admission. Hon Kiraitu telephoned me and asked me to help rescue Mwiraria but, in truth, if Mwiraria knew Kamani was behind everything and people in his office were calling him (Kamani) comfortably then clearly he knew more than had ever been made known to the Controller and Auditor General of the KACC," says Githongo.Mwiraria has dismissed all these as "reported speech."
The second minister to link Perera to Kibaki was Mr Kiraitu Murungi, who was at the time in charge of Justice and Constitutional Affairs.Kiraitu informed Githongo of his wish to speak to him in confidence, before he broached the Perera matter. The minister informed Githongo that the President had an interest in Pereras matter.According to Githongos report, Kiraitu produced a file from Mr Pereras lawyers, A H Malik and company advocates, on a long-standing court case involving the former Permanent Secretarys father, Mr Joe Githongo. He informed Githongo that he had been given the file by Mr Malik. Then he said the money the senior Githongo owed was Pereras and asked him to go easy on Pereras case.
Acts of intimidationGithongo also tells of a request by Pereras lawyers between himself and Perera "on neutral ground". He adds: "I asked them to put it in writing and they did. Then I declined their request."Githongos father has for a decade been wrangling with Pereras advocates over an initial debt of Sh30 million.Perera is a Sri Lankan resident in Cyprus and whose name has been mentioned several times in the report to Kibaki. The report links him to Euromarine, the Spanish registered company that was awarded a contract to supply ships to the Kenya Navy.
By his own account, Perera has been awarded contracts by the Government since the 1980s. They include supply Land Rover spares parts and construction equipment to the Department of Defence.But speaking to The Standard by phone, Perera denied having anything to do with the current scandals.He described the recent media reports as " just the latest in a series of acts of intimidation and threats made by a former high ranking civil servant whose family owes me approximately Sh80million".
The genesis of the amount he is claiming is a land deal entered into sometime in 1995 by Githongos father, Joseph Muiruri.According to court papers filed in the High Court at Nairobi Milimani Commercial Courts in May 2003, Githongo senior was to purchase from Kundan Singh Construction Limited a plot of land in Nairobis Kitisuru for Sh25million. He had hoped to make an onward sale in the sum of Sh70 million to Sh90 million with his contacts in the National Social Security Fund.
Term of agreementHe paid a deposit of Sh2.5million when he signed the agreement but was unable to raise the balance to complete the transaction. He then approached his long term family friend and lawyer, Zahir Malik and his son, Muin, to find him a person or company that could arrange for bridging finance.According to Malik, they (Malik and Muin) spoke to Perera, who agreed to lend Githongo Sh30million, inclusive of interest, if he was to pay the money by September 30, 1995. It was a term of the agreement that Muin was to be a nominee of the lender and that the lender would not be disclosed in the contractual documents, but the borrower would be made aware of him. This was agreed to between them and Githongo confirmed by signature, the lawyers say.According to an affidavit by Muin Malik, Githongo paid Sh5.5million towards the debt and thereafter defaulted.
Muin Malik moved to court in March 2003 and obtained a judgment and decree against Githongo for Sh61,493,333, inclusive of interest at 14 per cent per annum from December1, 1996. The judgment was entered in July 2003 after Githongo failed to defend the claim.However, Githongo has a different take of the claim. He admits paying Sh5.5million, but insists he has paid a further Sh5million by way of purchase of air tickets for overseas travel by Malik, wife and son."It had always been my understanding that the costs of these tickets would be credited against my debt to A H Malik and Company Advocates" says Githongo in an affidavit in support of his application to set aside the judgment. Legally too late
Githongo moved to court in February 2004, seeking to set aside the judgment, arguing that Muin Malik has no locus standi (sufficient legal interest) to sue him over the amount he was loaned in 1995 and that he does not owe Perera the amount claimed.Through Kapila Anjarwala and Khanna Advocates, Githongo says it is legally too late for Perera to seek to recover the debt.In a 41-paragraph affidavit in support of the application, Githongo says the claim against him cannot stand the legal test because it has "knowingly been filed by a person who does not have a vested interest in the contractual sum and for knowingly not having been filed in the name of Perera".
He says he has never borrowed money from a third party through Muin Malik and "the alleged terms of any such loan are not true".He takes the position that he borrowed Sh22.5 million from Muin Maliks father, Zahir Malik in August 1995 which was to be made by A.H Malik and company advocates.In response, Muin says in an affidavit that Githongos application is meant to delay payment of the amount due. He denies Githongo seniors claim that he paid Sh5.5million towards his air travel and that of his father and mother.Attempted to soil name
He also accuses John Githongo, then PS, of using threats of intimidation and coercion to force Perera to write off the amount owed.The case is listed for inter partes hearing on February 13, 2006 when Muin Malik is expected to cross-examine Githongo senior on his affidavit.In the telephone interview, Perera said his loan to Githongo had "become a big issue and my nightmare"."My entitlement to the sums due from the debt predates, by many years, the rise to prominence of the debtors son. The sons appointment to his position of power was made in January 2003, some eight years after my loan was made," says Perera
He denied using the debt to put pressure on the then PS, and said this was the first time in ten years he had made the debt public.Perera asked the former PS to come forward in a public forum and give evidence to support his allegations "so that I may be allowed to cross-examine him in the witness box".He alleged that Githongo had attempted to soil his name a few times since he filed the suit to recover his money from the father.Perera denied claims that he funded Narc campaigns in 2002 . He also denied any association with Euromarine. He also denied the reports that he paid President Kibakis hospital bills in 2002.