What you need to know:
- In some cases, customers were connected to the grid through unregistered post-paid metres.
- The money paid by these customers did not make it to the company’s accounts, but channelled to individual pockets.
- Some domestic customers paid ridiculously high bills of up to Sh300,000 per month.
Kenya power staff colluded with individuals and organisations to steal from consumers through inflated bills, an investigation has revealed.
The finding discredits a claim by the power distribution company last year that the inflated bills were as a result of migration to an Integrated Customer Management System (inCMS) and the backdating of bills in order to recover an outstanding Sh10.1 billion owed by customers.
The inflation of bills, Kenya Power argued, was necessary because it did not want to raise power charges during an election year, so it had to recover the money that had caused a huge hole in their 2017 financial statements.
The Nation learnt that the theft syndicate worked in three ways. In some cases, customers were connected to the grid through unregistered post-paid metres. The money paid by these customers did not make it to the company’s accounts, but channelled to individual pockets.
In the second scheme, some employees from the information technology department lowered bills at the expense of the company in exchange for kickbacks from the consumers who benefited. They would log into the system at night and during weekends from off-site locations and manipulate bills in favour of some consumers.
The third tactic was the boldest. Here, the schemers made money through inflating bills for some customers. They would then sit back and wait for those who would raise complaints.
Some domestic customers paid ridiculously high bills of up to Sh300,000 per month. Those who complained were coerced to part with some money before their bills were regularised.
Last night, the Director of Criminal Investigations (DCI), Mr George Kinoti, summoned 119 individuals and directors of companies to record statements next week as he ties up a 16-month investigation.
Mr Kinoti said 5,000 customers benefited from the scam. He instructed the companies to report to DCI headquarters along Kiambu road between Monday and Tuesday without fail.
“The DCI is investigating allegations of fraud involving millions of shillings at Kenya Power in regards to its postpaid billing system. The funds were lost as a result of conspiracy between some staff, brokers and customers. More than 5,000 customers benefited,” said Mr Kinoti. The DCI did not, however, say whether those summoned were victims or suspects.
Among those set to record statements is Moi University, whose five campuses have been listed. Others are Nairobi Women’s Hospital, Safaricom Investment Cooperative Society, Dandora Catholic Church, Eldoret Polytechnic and Sawagongo High School.
Sources say Kenya Power might have lost up to Sh1 billion as some of its employees had manipulated its billing systems and diverted money to their pockets. Part of the money was used to reimburse customers who filed their complaints with the company after the matter caused an uproar.
At some point, the heat was too much that the Energy Regulatory Commission (ERC) scraped a Sh150 fixed charge on electricity. In July, ERC argued that this move would reduce the overall unit cost of power from an all-time high of Sh17.77 kilowatt per hour to Sh16.64.
The matter even went to court through Former Law Society of Kenya chief executive Apollo Mboya but he reached an out-of-court settlement with Kenya Power in October.
In the settlement, Kenya Power agreed to stick to tariffs approved by the ERC and set up billing query centres countrywide.
In May 2017, Kenya Power acquired a new inCMS to replace the Integrated Customer System (ICS), which had been in place since 1997. At the time, the company argued that it needed a new system because the old one could no longer handle its huge customer base.
“This old system is obsolete and cannot accommodate the current company growth rate and the new customer base of 5.8 million users, real time,” said Eng. John Wekesa, the power firm’s chief engineer in charge of the new system during its launch.
Additional reporting by Nyaboga Kiage