What Uhuru-led PAC report said on Anglo Leasing

Kenya: Anglo Leasing tycoon Anura Perera, who is now demanding an additional payment of Sh3.05 billion, had close connection with State House during President Mwai Kibaki’s administration, a parliamentary report indicates.

According to the Parliamentary Accounts Committee’s (PAC) hard-hitting report into the dubious contracts, Mr Perera allegedly supported former President Kibaki, including during his hospitalisation after the road crash ahead of the 2002 presidential contest.

The details of their relationship are captured in a secret recording by former anti-graft Czar John Githongo against former Justice Minister Kiraitu Murungi and which PAC admitted as factual.

“The Committee finds that there is credible evidence to suggest that Hon Murungi, MP, gave protection to Anglo Leasing principals,” the report reads in part. “The Committee further finds that, based on Hon Murungi’s various discussions, the principals were probably a front for persons within President Kibaki’s administration.”

Murungi, now the Meru Senator, reportedly told Githogo that, “Mr Perera supported ‘our chief’ even when he was in hospital, in 1997 and 2002” and asked him to go slow on the matter.

“Hon Murungi, MP, advised Githogo to go slow on corruption investigations in return for similar favours being extended to his father’s case pending in court. This was obviously a bribe by a minister in charge of justice punishable under the Public Ethics Act,” the MPs noted.

According to the report, which was authored by among others, President Uhuru Kenyatta, then Leader of the Official Opposition, the indictment of senior figures in Government, explained the regime’s lacklustre approach in conducting investigations into the sleaze.

Uhuru’s nightmare

Ironically, 10 years later, the Anglo Leasing rip-off that amounted to Sh56 billion has turned out to be Uhuru’s nightmare, with a section of civil society now alleging that the corruption network has caught up with his Jubilee administration.

“The way this transaction was executed raises reasonable suspicion,” warned Transparency International Executive Director Samuel Kimeu. “These shady deals that were conceived and nurtured under the Kanu regime and blossomed under the Narc and Grand Coalition administrations may have found new patrons in the Jubilee administration.”

Last week, Uhuru ordered Treasury Cabinet Secretary Henry Rotich to wire Sh1.4 billion to two Anglo Leasing firms — First Mercantile Securities Corporation and Spacenet Inc — sparking a public outcry.

But amidst the uproar, Perera is back demanding more. On Thursday, Deputy Solicitor General Muthoni Kimani and Treasury Principal Secretary Kamau Thugge shocked MPs that the Government had received a notice of claim of another Sh3.05 billion for Project Flagstaff, linked to the National Intelligence Service (NIS).

Uhuru defended the initial payment insisting it was the only way the country could secure a Euro bond his government plans to float, and noted that declining to pay the debt would mean cutting back on Government expenditure and service delivery of programmes to Kenyans.

The payments, which were made without written authorisation of the President, were wired into one bank account, confirming that the two firms belonged to one person.

The money was sent to one Travers Smith, account number 00859184 who holds an account with Natwest Bank in London. Early this week, Attorney General Githu Muigai confirmed that the two firms were linked to Perera.

Damning report

According to the PAC report, the persons who were agents, possible owners or possible directors of the Anglo Leasing firms were Perera, Deepak Kamani, Amin Juma, Merlyn Kettering and one Mrs Ludmilla Kutuschenko.

The damning report indicted senior people in President Kibaki’s Narc administration and recommended investigations of several Cabinet ministers.

The report accepted that Kibaki had known about the Anglo Leasing contracts and recommended investigation of former Vice President Moody Awori.

The report also endorsed investigations of Kiraitu, former Finance Minister David Mwiraria, and former civil service head Francis Muthaura. The 59-paged report also found former Attorney General and now Busia Senator Amos Wako guilty of “serious negligence”.

“The Vice President must take responsibility for asserting that Anglo Leasing was a company of good repute when the evidence available is contrary,” the PAC report concluded.

The committee put Awori on the spot following the procurement of passport issuing equipment when he was the minister for Home Affairs. The committee also accepted evidence of secret tape recording by Githongo against Mwiraria in which the minister pleaded with the former to stop his investigation, claiming that the scam would bring down Kibaki’s regime.

“The committee accepts evidence about the discussions between Mr J Githogo and Hon Mwiraria, as authentic which is supported by recorded conversation between them in which Hon Mwiraria, MP states the country will fall if the investigations continue,” the report reads in part.

Fresh probe

The Committee slammed Mwiraria for what they termed as displaying a “most cavalier attitude” towards the contracts and concluded that he was either “outrightly incompetent or was deliberately remiss with a view to giving the Anglo Leasing principals an advantage”.

On February 1, 2006, Mwiraria resigned followed by Kiraitu who stepped aside together with Kibaki’s aide Alfred Getonga.

However, Kiraitu bounced back to Cabinet nine months later after the Kenya Anti-Corruption Commission under the watch of Aaron Ringera cleared him of any wrongdoing.

But speaking to The Standard on Sunday yesterday, State House Spokesman Manoah Esipisu reiterated that the Government is keen on conducting fresh investigations into the scam.

“We will ensure that the money paid by the Government of Kenya is recovered. I ask the Ethics and Anti-Corruption Commission to do everything to ensure that this money is recovered,” Uhuru had ordered.

The PAC report that involved travelling to London to take evidence from Githogo was authored by seven MPs only, after Kibaki elevated other four members to the position of assistant ministers.

The seven MPs were Uhuru, Charles Keter (now Kericho Senator), Billow Kerrow (Mandera Senator), former Kamukunji MP Norman Nyagah, former Lamu West MP Fahim Twaha, former Bonchari MP Zebedeyo Opore and former Eldoret East MP Joseph Langat.