Kenyan taxpayers lost more than KSh300 million ($3 million) to unscrupulous contractors in the run up to the aborted 2018 Africa Nations Championship (CHAN), an auditors report shows.
According to the reports by a parliamentary committee that is investigating the matter, the Kenyan government paid Sh330.5 million to a ‘ghost’ company for the installation of security equipment in various stadiums that were to host CHAN.
Kenya was later stripped of the hosting rights due to unpreparedness and the political instability that was experienced in the country after the 2017 General Elections.
The Public Accounts Committee (PAC) was stunned when they were informed that the firm contracted by Ministry of Sports to do the work went bankrupt immediately it was paid Sh330.5 million.
The address of the company, MS Auditel Limited, could not be traced after it allegedly pocketed the money, before closing operations in Kenya.
“As a committee, we were unable to confirm whether this company is in existence or not. We could not even get them to come before us. Auditel had an office in Lavington and Westlands, but after being paid disappeared into thin air and could not be traced,” a member of the committee bemoaned.
The firm allegedly went bankrupt, but till sought renewal of their contracts and additional payments, reports the Standard newspaper.
The Sh330.5 million, according to an audit report, was a 20 per cent advance payment based on a security guarantee issued by a bank in Madrid, Spain.
The guarantee expired on February 28, 2018 meaning that there is no hope of recovering the money so far lost.
The work was expected to be done at the Nyayo, Kasarani and either Kinoru or Machakos stadiums, that were to host the event. A spot check in the said stadiums shows no sign of work undertaken.
“It is also not clear when and if the project will be completed, considering the funding was withdrawn by the National Treasury,” warns the auditor’s report.
Sports Principal Secretaries Joe Okudo and his predecessor Kirimi Kaberia appeared before the Parliamentary Committee.