How Moi's Allies Looted Sh130bn

Daily Nation Story by DAVID OKWEMBAH An international report has revealed how a corrupt network in the Moi regime looted at least Sh130 billion of Kenyan taxpayers’ money. The report by risk advisers Kroll and Associates had been kept secret by the Kibaki administration for the past four years. Now the list of relatives and associates of the former President and their vast local and overseas investments has been exposed in a 110-page account published on the Internet. It shows how people close to Mr Moi set up shell companies, fronts and secret trusts to siphon away Kenyan taxpayers’ money, which they stashed in banks, real estate and companies in an estimated 30 countries around the world. Their assets overseas include multi-million pound properties in London, New York and South Africa, as well as a 10,000-hectare ranch in Australia and bank accounts containing hundreds of millions of pounds. The report was compiled by the London-based company on the instruction of the Kibaki government in 2004, but has been kept under wraps and has apparently not been acted upon. It details how Mr Moi’s sons Philip and Gideon were reported to be worth £384 million and £550 million respectively; Some of President Moi’s associates colluded with Italian drug barons and printed counterfeit money; --A clique around him owned a bank in Belgium; --The threat of losing their wealth prompted threats of violence between Mr Moi’s relatives and his political aides --A total of £4 million was used to buy a home in Surrey and £2 million to buy a flat in Knightsbridge. The London newspaper, The Guardian, said Kroll could not confirm or deny the authenticity of the report but went on to quote from it substantially. The Kroll investigation into the Moi regime was commissioned by President Kibaki shortly after he came to power on an anti-corruption platform in 2003. It was to be the first step towards recovering some of the money stolen during Mr Moi’s 24-year rule. But soon after, the Kibaki Government was caught up in its own scandal, the Anglo Leasing affair, which involved awarding huge security-related contracts to some 18 dubious companies or at inflated prices. Wheeler dealers Officials in the Kibaki Government named in the report as having links with controversial wheeler dealers of the Moi era include the State House-based Permanent Secretary for Strategic Policy, Mr Stanley Murage. Mr Murage retired as a PS in the Moi government but was later recalled to the Kibaki State House where he still works. He and the former State House comptroller, Mr Matere Keriri, claims the report, were linked to the people behind a controversial project called Team Simoco — for the supply of a multi-billion shilling police communications. Although Cabinet minister Kiraitu Murungi at one time confirmed that at least Sh70 billion lost in the Moi era had been traced by Kroll, no recovery has ever been announced. Three of the four ministers who resigned after the Anglo Leasing scandal was exposed have since been reinstated. Kroll investigators allege that a Kenyan bank was the key to getting vast sums of money out of the country via its foreign currency accounts. The same bank had already laundered $200 million (£100m) on behalf of the late Nigerian leader Sani Abacha, with the assistance of a Swiss-based “financier” Money laundering The leaked report claims that associates of President Moi had been linked to trade in drugs and money laundering. The countries where some of the money was traced include: Britain, Switzerland, South Africa, United States, Namibia, Malawi and little known ones like Cayman Islands and Brunei. The investigation was commissioned by President Kibaki’s Government when the anti-corruption czar, Mr John Githongo, was still in government. Mr Githongo quit two years ago and moved to Britain. At the time, Mr Githongo had estimated the money stolen from the public coffers at around Sh80 billion. Should the facts revealed by Kroll be confirmed to be true, then the Sh130 billion could be similar in magnitude to those perpetrated by other discredited governments in Africa, including those of Mobutu Sese Seko of Zaire and Nigeria’s Sani Abacha. Yesterday the permanent secretary for Justice and Constitutional Affairs, Ms Dorothy Angote, confirmed that the Kroll report had been handed over to the Government and passed on to the Kenya Anti-Corruption Commission (KACC). But it could not be acted upon, she said, because it did not have substantial evidence. Ms Angote asked why developed nations allowed money stolen from the Third World to be stashed in their banks and later blamed looters in the impoverished states. “We are pushing for an agenda where the Group of Seven industrialised nations can announce that nobody will be allowed to bank suspicious money in their countries”, the PS added. Among the assets accumulated by the Moi associates includes multi-million pound properties in the 30 world capitals like London, New York and South Africa. Others include bank accounts spread all over Europe, America and Africa containing billions of shillings. The report details corruption deals from the early 1980s to the day Mr Moi vacated State House on December 30, 2002. It links up major scandals including Goldenberg, the Turkwel Gorge and the collapse of the Trade Bank. The report gives the wealth of the retired president’s sons — Philip and Gideon — as Sh5 billion and Sh3.6 billion respectively. Acquire a home Besides the money stashed away in foreign accounts in Europe, America and South Africa, the report states that some of the money moved from Kenya was used to acquire a home in Surrey worth £4 million (Sh520 million) and a flat in Knightsbridge worth £2 million (Sh360 million). A clique around Moi is also said to own a bank in Belgium which has a branch in Nairobi. A Kenyan bank, Transnational, is accused of having been involved in questionable transfers of money to the tune of Sh13 billion ($200 million). The man behind the transaction is believed to be one of the biggest money launderers in Geneva. According to Kroll, a falling out between the retired President’s family and his associates led to threats of violence between Mr Moi’s relatives and his political aides. A fight involving one of the former president’s sons and his former lawyers at the Mayfair Hotel in Nairobi three years ago was a result of a disagreement over the sale of one property in South Africa, it claims. A businessman then based in Nairobi is named as the man behind the creation of dummy trusts in the Cayman Islands. Through the trust, he is said to have invested a staggering $500 million (Sh33 billion) in Europe on behalf of the retired president’s associates. In South Africa, Kroll reveals, a man fronting for the Moi associates closed down 74 corporations linked to the retired president’s clique. Besides using fronts to transact business, the clique used the names of lawyers and law firms to conceal their real owners. In one instance, Kroll even uncovered a business in the name of the Government of Kenya in which officials are listed as Moi, Prof George Saitoti, Dr Sally Kosgei, Chris Okemo, Nicholas Biwott, Mark Bor, J. K. Musyimi and a Mr Deche. It recommended that the government establishes the business transacted by this firm. The leaking of the Kroll report comes just three days after former President Moi threw his weight behind the re-election of President Kibaki. Yesterday, Government spokesman Alfred Mutua confirmed the Kroll report had been received in 2004 but dismissed it as “incomplete and inaccurate.” He said: “We did not find that the report was credible. It was based on a lot on hearsay.” The leaking of the report, he said, was politically motivated and Kenya was working with foreign governments to recover the stolen money. “Some of the money is in UK bank accounts. We have asked the British government to help us recover the funds, but so far they have refused,” he added. Backing Kibaki On Tuesday, Mr Moi said he was backing Mr Kibaki for a second term, saying he was disappointed that “selfish individual interests have been entrenched in our society”. In the Kroll report the investigators allege that a Kenyan bank was the key to getting vast sums of money of out of the country via its foreign currency accounts. Finance minister Amos Kimunya said that a draft report had been prepared for action by Mr Githongo and KACC. “Unfortunately, Mr Githongo fled the country before he could act on it leaving the investigations to KACC,” he added. KACC director Aaron Ringera is expected to respond to the Kroll report. But Mr Kimunya read mischief in the leaking of the report, seeing the hand of some opposition figures. The British High Commission’s Ms Charly Williams said London was ready to help Kenya recover the looted funds but the Kibaki government had never asked for assistance. She said she was surprised. By Dr Mutua’s comments