A suspended Kenya Revenue Authority (KRA) official allegedly pocketed Sh130,000 to facilitate the release of condemned sugar worth Sh20 million, a parliamentary committee has heard.
KRA officials who appeared before the National Assembly Trade and Investment Committee said that investigations by the Directorate of Criminal Investigations (DCI) had established that a Derrick Kago allegedly received the said payment.
The money is believed to have been an inducement to allow access to a warehouse in Thika where the sugar was stored. Kago is alleged to have changed the KRA customs seals at the Vine Pack Industries Limited warehouse without approval from the authority.
"DCI investigations showed that Derrick was paid about Sh130,000... that is why he was suspended," said Levi Mukweso, a senior officer at KRA.
Kago is among the 27 officials suspended by President William Ruto over the release of a 20,000-tonne consignment of condemned sugar to the market.
The controversial sugar was imported to the country in 2018. The Kenya Bureau of Standards flagged it as unfit for human consumption and directed that it be destroyed.
A multi-agency task force would later direct that the condemned sugar be distilled into ethanol for industrial use, but it was later diverted and released to the market.
Mukweso told lawmakers that they only learnt of the disappearance of the sugar in the course of the DCI's investigations. He said that the DCI had summoned them to their Mazingira House headquarters following reports of the said diversion.
Faith Kiara, a chief manager at the KRA, accused Kago of concealing his actions by failing to submit a report on the change of custom seals.
"Derrick did not report to us that the seals were broken, an action that requires prior approval and that must be done in the presence of the warehouse owner," said Kiara, who revealed that Kago was the last person in contact with the go-down in March.
The suspended KRA official had been sent to deliver a tax demand letter to Vine Pack over unpaid taxes. Vine Pack was to distill the ethanol and had been slapped with a Sh20 million tax demand for the sugar, against the Sh4 million they paid. The firm had no license to distil the industrial ethanol.
Lawmakers, unconvinced by explanations by the KRA officials, argued that Kago was a sacrificial lamb in a wider conspiracy involving top KRA officials.
"Kago's only offence was that he delivered the letter. Was he even aware of the content of the letter?" Posed Starehe MP Amos Mwago, to which Kiara said that Kago had been aware of the letter's content, insisting that it was wrong to authorise the change of the seals.
Gakuya read the involvement of shadowy figures who offered KRA officials protection. He said it was strange that the consignment had been released from the Mombasa port in order to facilitate its extraction from Thika.
"It was a conspiracy right from day one... why didn't the sugar disappear along the way? Furthermore, when you were opening the seals at the warehouse you excluded other stakeholders?" Posed Gakuya, a position held by Kajiado South MP Samuel Sakimba.
"There is no way 20 lorries would have moved undetected," he said of the lorries believed to have transported the sugar from the warehouse.
The committee will again question the KRA officials, as well as others alleged to have been involved in the release of the sugar on October 17.
