Corruption in Kenya

Corruption in the government of Kenya has a history which spans the era of the founding president Jomo Kenyatta, to Daniel arap Moi's KANU, Mwai Kibaki's PNU government and the current Uhuru Kenyatta's Jubilee Party government. In the Corruption Perceptions Index 2021 Kenya is ranked 128th out of 180 countries for corruption, tied with seven other countries, including Bolivia, Azerbaijan, Laos, and Paraguay (least corrupt countries are at the top of the list).

Most bribes paid by urban residents in Kenya are fairly small but large ones are also taken – bribes worth over KSh.50,000/= ( €600, US$450) account for 41% of the total value. There is also corruption on a larger scale with each of the last two regimes being criticised for their involvement.Transparency International. (2020). ''2020 - CPI - Transparency.org''. Corruption Perceptions Index 2020. https://www.transparency.org/en/cpi/2020/index/nzl

Despite market reforms, several business surveys reveal that business corruption is still widespread and that companies frequently encounter demands for bribes and informal payments to 'get things done' in Kenya, a trend that has contributed to an increased cost of doing business in Kenya. The public procurement sector in Kenya suffers widespread corruption and is the leading form of graft in the public service and always at the centre of all major corruption scandals. The use of agents to facilitate business operations and transactions in Kenya is widespread and poses a risk for companies, particularly at the market entry and business start-up stage.

Despite positive developments, the Kenya Anti-Corruption Commission (KACC) was disbanded and replaced by the newly instated Ethics and Anti-Corruption Commission(EACC) on 5 September 2011. Observers describe the new agency as superficial.

It is observed that in Kenya bribery and nepotism as most prevalent forms of corruption according to surveys carried out.

On 22 July 2019, Kenya's finance minister Henry Rotich became the country's first sitting minister to be arrested for corruption. This followed an order by the Director of Public Prosecution (DPP) Noordin Haji for the arrest and prosecution of Mr. Rotich and his Principal Secretary (PS) Kamau Thugge among other top government officials over the multibillion-shilling Arror and Kimwarer dams scandal.

In 2017, the US government cut health funding to Kenya over widespread corruption in the Ministry of Health. USAID suspended $21M funding for activities carried out by a number of the Ministry's departments over corruption and weak accounting procedures.

Before 1990

* The first corruption incident in Kenya is widely regarded as the Ngei maize scandal of 1965. Paul Ngei, an independence hero and at the time the Minister for Marketing and Cooperatives, was involved in a maize scandal that caused a national maize shortage. The Commission of Maize Inquiry, the first of its kind in independent Kenya, found that Ngei's wife, Emma, was getting preferential treatment for her business, Emma Stores (Uhuru Millers of Kangundo), through which she bought maize directly from farmers, which was illegal at the time.
* Between 1986 and 1991 the construction of the Turkwel Hydroelectric Power Station was riddled with claims of corruption. The dam was eventually built at three times the estimated cost, twice the allocated amount and producing energy significantly below capacity.

Turkwel Dam Scandal

The Turkwell Gorge Hydro Electric Dam Project was commissioned in 1986 and completed by French company Spie Batignolles in 1991. The construction of the dam is one of the controversial projects that characterized former president Moi's administration in the late 80s and early 90s. According to media reports the project was riddled by allegations over pricing, lack of environmental assessment and feasibility study and failure to have an open tendering process that saw the contract awarded to the French company.

In 1986, Achim Kratz, then European Commission delegate to Kenya, in an internal memo that was leaked to the ''Financial Times'' alleged that Kenya's failure to have an open tendering process resulted in the government paying more than double the cost.

The blame on the alleged corruption surrounding the dam was blamed on two government officials: then Minister of energy Nicholas Biwott and then Finance Minister George Saitoti who were accused of handpicking the French company for the job for their own gain in terms of kickbacks.

In 2000, the permanent secretary, secretary to the cabinet, and head of Public Service to the Kenyan government, Dr. Richard Leakey declassified the Turkwel dam files making them publicly accessible. The information, which falsified the graft allegations raised against the project including the lack of an open tendering process, was also made public in Hansard, parliamentary debates of June 8, 2000.

The late president Moi had appointed Dr. Leakey in 1999 to head the civil service and help with reform the corrupt civil service and privatization of state-owned companies but Leakey stepped down in 2001.

In March 2002 in High Court Case No 2143 of 1999, Nicholas Biwott successfully sued the People's Daily Newspaper over libel after the paper published a story accusing him of colluding with the French firm to award it the contract in disregard of due process. Justice Aluoch awarded him 10M in damages.

1990–1999

* The longest-running scandal is the Goldenberg scandal,Forensic accountants trace Goldenburg transaction
(Corpwatch) where the Kenyan government subsidized exports of gold, paying exporters in Kenyan shillings (KSh.) 35% over their foreign currency earnings. In this case, the gold was smuggled from Congo. The Goldenberg scandal cost Kenya the equivalent of more than 10% of the country's annual GDP.
* A KSh.360 million/= helicopter servicing contract in South Africa.New scandal hangs over Sh2.6b secret Army complex
(East African Standard) Military officers had argued that the contract was too extravagant and servicing the helicopters could be done locally. Kenya Air Force (KAF) went ahead to spend KSh.108 million/= as a down payment for servicing the Puma helicopters, whose tail number is logged as 418 at Denel Aviation, a South African firm.

2000–2009

"In 2003, because of the corruption and misuse of the arms under their custody, 600 KPRs (Kenya Police Reserves) were disarmed in Tana River, and in most urban areas of Kenya, they were disbanded as of 18 April 2004. Among the reasons given was that officers had become a threat to the national security instead of defending it. In some areas, the officers commanding police divisions did not know the number of men they had, even though they were issued with firearms, ammunition and walkie-talkies."

* In 2003, the military was split over plans to buy new Czech fighter jets. The plan to buy the jet fighters would have cost taxpayers KSh.12.3 billion/=.
* A KSh.4.1 billion/= Navy ship deal. A Navy project was given to Euromarine, a company associated with Anura Pereira, the tender awarded in a process that has been criticised as irregular. The tender was worth KSh.4.1 billion/=. Military analysts say a similar vessel could have been built for KSh.1.8 billion/=.
* Chamanlal Kamani had been involved in a supply contract, as Kamsons Motors.Kenya Graft Watchdog Set to Charge More Suspects
/ref> Kampsons tendered for the supply of Mahindra Jeeps to the Police Department in the mid 1990s for close to KSh.1 million/= (US$13,000) each, at a time when showrooms would have charged customers a sixth of the price. Moreover, the vehicles were being bought for a government department and were therefore imported duty-free. Few of the more than 1,000 units that were imported over several years are in service today.
* The Kamanis were also involved in a deal to build a CID forensic laboratory. On 7 June 2004 an amount of $4.7 million was wired back. The payment was a refund against the money paid for the Criminal Investigations Department forensic laboratory.When bogus firms wired back Sh1bn
(Daily Nation) Another €5.2 million was paid back in respect of the E-cop project, which involved computerisation of the police force and the installation of spy cameras in Nairobi by Infotalent Systems Private Limited.
* The Prisons department lost $3 million after contracting Hallmark International, a company associated with Deepak Kamani of Kamsons Motors, for the supply of 30 boilers. Only half of the boilers were delivered – from India and not the United States as had been agreed.
* The construction of Nexus, a secret military communication centre in Karen, Nairobi. The Government spent KSh.2.6 billion/= (US$36.9 million) to construct the complex. Three years later, military personnel have not moved into the centre. A phantom company, Nedermar BV Technologies, which is said to have its headquarters in the Netherlands, implemented the secret project situated along Karen South Road. Nedermar is linked to businessman Anura Pereira. However, Pereira has denied this. The tendering process for the Nexus project was circumvented as DoD's Departmental Tender Committee. Funding for the project was made through the Ministry of Transport and Communications. The complex is currently headed by Colonel Philip Kameru. Nexus was first meant to be an ammunition dumpsite before it was turned into a military communication and operations centre. Construction continued without any site visits by either the DoD staff or Ministry of Public Works officials. The Nexus project was implemented during the tenure of General Joseph Kibwana.
* In 2005 plans to buy a sophisticated £20 million  stg. passport equipment system from France,report on the Anglo Leasing scandal
(Guardian)It's time to tell the Kenyan people the truth about the Anglo-leasing corruption scandal
(Transparency International) as government wanted to replace its passport printing system, created conditions for corruption scandal. The transaction was originally quoted at 6 million euros from François Charles Oberthur of Paris (a supplier of Visa and MasterCards) but was awarded to a British firm, the Anglo-Leasing and Finance Company Limited, at 30 million euros, who would have sub-contracted the same French firm to do the work. Despite the lack of competitive tendering Anglo Leasing was paid a "commitment fee" of more than £600,000 stg. Anglo Leasing's agent is a Liverpool-based firm, Saagar Associates, owned by a woman whose family has enjoyed close links with senior officials in the Moi regime. Company records show Saagar Associates is owned by Mrs Sudha Ruparell, a 47-year-old Kenyan woman. Ruparell is the daughter of Chamanlal Kamani, the multimillionaire patriarch of a business family that enjoyed close links with senior officials in the Moi regime. Anglo Leasing made a repayment of €956,700 through a telegraphic transfer from Schroeder & Co Bank AG, Switzerland on 17 May 2004.
* The local chapter of Transparency International and the Kenya National Commission on Human Rights (KNCHR), a government body released a report in February 2006, stating that between January 2003 and September 2004, the National Rainbow Coalition government spent about US$12 million on cars that were mostly for the personal use of senior government officials.Vehicle Saga Shows Parliament Has Few Budgetary Teeth
(Inter Press Service News Agency) The vehicles included 57 Mercedes-Benz, as well as Land Cruisers, Mitsubishi Pajeros, Range Rovers, Nissan Terranos and Nissan Patrols. The US$12 million substantially exceeded what the government spent over the 2003/04 financial year on controlling malaria – "the leading cause of morbidity and mortality in Kenya", says the report.
* In late February 2006, the newspaper '' The Standard'' ran a story claiming that president Mwai Kibaki and senior opposition figure Kalonzo Musyoka had been holding secret meetings. On 2 March at 1:00 am local time (2200 UTC on the 1st), masked gunmen carrying AK-47s raided multiple editorial offices of ''The Standard'', and of its television station KTN. They kicked and beat staff members, forcibly took computers and transmission equipment, burned all the copies of the 2 March edition of the newspaper, and damaged the presses. At KTN, they shut down the power, putting the station off the air. Initially, the Kenyan information minister claimed no knowledge of the raid, but it has since revealed that Kenyan police were responsible. The Ministry of the Internal Security later stated that the incident was to safeguard state security. "If you rattle a snake you must be prepared to be bitten by it," John Michuki said. Three journalists at ''The Standard'', arrested after the critical story was printed, are still being held without charge. The story now also features the bizarre case of two Armenian businessmen, mocked in the press for their taste for heavy gold chains, watches and rings, referred to as Mercenaries, who the opposition says led the raid and had shady dealings with Kibaki's government.
* In November 2006, the government was accused of failing to act on a banking fraud scam worth $1.5bn involving money laundering and tax evasion, reported by whistle-blowers as early as 2004. Investigators believe sums worth 10% of Kenya's national income are involved. A recent auditor's report says the scale of the operations "threatens the stability of the Kenyan economy".
* In November 2006, British Foreign Office minister Kim Howells warned, that corruption in Kenya is increasing the UK's exposure to drug trafficking and terrorism. "People can be bought, right from the person who works at the docks in Mombasa up to the government. (...) This weakness has been recognised by drug-traffickers and probably by terrorists too." Said Howells for the BBC
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