How City Hall officials paid millions for air

For nearly six years, the Nairobi City County officials sent hundreds of millions of shillings to shadowy businesspeople for supplies that never arrived.

The Ethics and Anti-Corruption Commission (EACC) says at least Sh407 million vanished through fraudulent payments involving 14 businesses.

High Court filings reveal the elaborate scheme of unqualified vendors, forged documents, non-existent deliveries, and greedy county officials.

"Investigations revealed that between FY 2016/2017 and FY 2021/2022, senior county officials approved irregular payments amounting to Sh407,926,503.20 for no deliveries/supplies made to the county to 14 un-prequalified business entities, thereby facilitating fraudulent transfer of public funds," argues EACC.

EACC claims that there was a deliberate effort to defraud public institutions with proceeds channeled through layered transactions to conceal the origin and beneficiaries of the money.

According to the court documents, procurement contracts were falsified, deliveries faked, and approvals pushed through despite glaring red flags. In one case, Sh5 million was allegedly paid as a kickback to a procurement officer. In another, payments were made to companies registered just months before they received lucrative contracts.

Between the 2016/2017 and 2021/2022 financial years, the EACC says the county paid Sh297 million through the Integrated Financial Management Information System. Another Sh109 million was paid out via cheques.

The agency has sued the 14 companies and over a dozen senior county officials, including procurement heads and finance officers.

The largest single beneficiary, Petrim Investments, allegedly pocketed Sh65 million. Other firms implicated include Mipe Enterprises, Jemishley Construction, and Ossiezeys Enterprises, most of which were not pre-qualified to do business with the county.

Among the defendants is Mary Wanjiku Mwangi, a businesswoman operating under at least two entities - Keywharf Investments and Maymill Enterprises - which allegedly received over Sh69 million in irregular payments. Another company, Transgenic Solutions, allegedly received nearly Sh28 million without delivering a single item.

At the centre of the scheme were top officials: procurement directors, senior accountants, and department heads said to have approved the payment of substantial sums. For example, Richard Mogoko, a procurement director, is accused of approving Sh101 million. Joseph Gathiaka, a chief officer, allegedly authorised over Sh152 million payments.

The agency is seeking to recover the lost money and freeze the assets of those involved. The EACC has asked the court to compel restitution and bar the implicated officials and business people from holding public office or transacting with government entities.

Many of the implicated firms share directors, addresses, and even bank accounts - further pointing to a coordinated operation.

Other officials accused of making irregular approvals include Gathiaka, who allegedly authorised payments amounting to Sh152,882,847.90, Mohamed Abdirahman (Sh135,841,241.60), Moses Okere and Luke Gatimu (Sh109,932,050 each), and Mogoko, who is said to have sanctioned Sh101,229,051.75.

Others implicated are Joyce Muniu, who allegedly allowed the payment of Sh69,432,993.15, Peter Ingwe (Sh40,779,569), Joel Ngui Muli (Sh36,329,677.25), Martha Wambugu (Sh18,292,965), Matthew Kinyanjui and Halkano Waqo (5,784,482.75 each), and Jeremy Kimathi Muiriria (Sh4,805,689.65).