Covid millionaires continue to walk scot-free a year later

At a time like this last year, highly connected businessmen were making last-minute plans to charter planes to fly in scarce Covid-19 gear from China and India.

As health officials were fixated on the global movement of the virus, which had now arrived in Africa, tenderpreneurs were lining up at the Registrar of Companies to incorporate new outfits that would become the vehicles to get fraudulent tenders at the Kenya Medical Supplies Authority (Kemsa).

Then there were lucky ones, who just walked to Kemsa’s head offices on Commercial Street in Nairobi’s Industrial Area, and found tenders being dished out. In their own admission, they walked out with lucrative tenders.

For others like Eunice Cherono, who despite her company dealing in interior design, they just took a leap of faith, prayed and also ‘walked into Kemsa with faith.’

Cherono says God directed her to Kemsa to get a Sh42 million tender to supply Personal Protective Equipment (PPE).

That was not all. Others just arrived at the agency offices, having got wind of what was happening, sat at the reception and waited.

Commitment letters

Then Kemsa officials would randomly ask anyone in the room who could supply face masks to raise their hands. And just like that, they were on their way to become Covid-19 millionaires. 

Commitment letters were given, then backdated in blatant breach of the procurement laws. 

Twelve firms, for instance, were handed contracts worth Sh3 billion to deliver items that were not covered by Kemsa’s 2019/20 approved budget as at June 4, 2020, with some multimillion-shilling irregular bids going to friends and well-connected individuals.

It did not stop there, politicians, some of whom are now investigating the same procurement fraud at the agency, were also roped into the procurement frenzy. Relatives of top families in the country were also not left behind in the Sh7.8 billion scandal.

Then there was Kilig Limited, which was owned by Ivy Minyow Onyango, whose story demonstrates how easily Kenya’s procurement system can be bent.

Kilig was registered on January 22, weeks before Africa reported its first coronavirus case. 
Several weeks later, the company, linked to a top Jubilee politician, was handpicked and handed a Sh4 billion offer to supply hundreds of thousands of PPEs.

Big tender

Each kit was to be delivered at an inflated cost of Sh9,000 from the then market price of Sh4,500, according to revelations in Parliament. The complete kit includes N95 masks, body suits, goggles, waterproof shoe covers and gloves. She was to supply 450,000 of each item.

The fact that her company had no proof or record of ability to supply such a big tender on such a short notice did not bother Kemsa executives. But when heat became too much, Kemsa quietly cancelled the tender when it was clear the company had no capacity to supply.

Before top Kemsa officials realised they were breaking the law, they had issued commitment letters over and above what their budgets could allow, and their warehouses were already filling with expensive supplies that came with huge mark-ups, and would pose a challenge to offload.

At the height of the scandal, Kemsa would be left to deal with losses from the Sh6.2 billion stock stuck at its warehouses.

The Ethics and Anti-Corruption Commission (EACC) would later swing into action, freezing all payments to the companies to stop any further losses.

EACC said when its detectives came in, they helped stop another Sh9 billion that was to be paid out.

Investigations

EACC boss Twalib Mubarak said the caveat not to pay is still on until the investigations are completed, which means that the companies will have to wait longer to get their money. 

But several months down the line, the trail appears to have gone cold, and apart from the three top officials who were suspended, no one is yet to be charged in court for the scandal, a complete departure from previous scandals.

The EACC boss did not pick our calls yesterday or reply text messages inquiring why the agency has taken too long to bring culprits to book.

But the EACC has in the past shifted blame to the office of the DPP, which has not been very enthusiastic in approving the charges, and has instead returned the file back to the EACC asking the graft agency to tie up some lose ends.

EACC has since returned the file to the DPP, and it is not yet clear who between the two agencies is now holding back the process.

Parallel probes have only managed to unearth faces of small time businesses, leaving out actual billionaires, politicians and connected individuals who benefited the most from the scandal.