Kenya to prosecute 13 people over controversial security contracts

Kenya's chief prosecutor on Monday ordered the arraignment of the 13 people and three firms implicated in the 16.1-million-U.S.-dollar controversial Anglo Leasing debt, which officials believe was a corruption scandal.

Director of Public Prosecutions (DPP) Keriako Tobiko said the suspects will be charged with conspiring to commit an economic crime, acquiring property fraudulently and engaging in a project without prior planning.

"I have today directed that all the 13 individuals and three corporate entities recommended by Ethics and Anti-Corruption Commission (EACC) to be charged be taken before court forthwith to face various criminal charges," said Tobiko in a statement issued in Nairobi.

He said he had perused the three Anglo Leasing type security contracts investigation files resubmitted to him by the EACC and was satisfied that there is sufficient evidence to sustain all the charges recommended by EACC.

Tobiko said they will further be charged with abuse of office, failure to comply with procurement laws, disobedience of statutory duty and breach of trust.

The three files apparently touch on contracts involving the procurement of security material for the Postal Corporation of Kenya (PCK), security equipment for the police and early warning systems for the Meteorological department and had no international component.

The move comes after President Uhuru Kenyatta in May 2014 authorized the Treasury to pay 16.1 million dollars controversial Anglo Leasing debt.

Kenyatta said the government's decision to settle the judgment debts is premised on protecting Kenya's economy on account of rising interest rates occasioned by domestic borrowing due to constrained access to international borrowing.

He said settling the debt will also protect Kenya's reputation as a country that meets its contractual obligations and adheres to the rule of law, protecting assets abroad, and maintaining and improving the country's credit rating currently at B+.

Kenyatta said the government had exhausted all judicial options to forestall payment of the judgment debts and the way forward is for the government to settle to minimize further loss as the outstanding awards continue to accrue interest.

The Anglo Leasing scandal, which started before the 2002 election of former President Mwai Kibaki, involved State contracts worth hundreds of millions of dollars being awarded to nonexistent firms.

The start of the scandal was the contracting of a loan in December 2003 by the Department of Immigration to enhance security by modernizing the issuance of secure passports and purchase of security equipment for use at Kenya's borders.

The procurement process was however abused and a company, Anglo Leasing and Finance Company Ltd, was awarded the tender and 1.1 million dollars paid up-front.

This became public on May 4, 2004 when the matter was raised in Parliament. Subsequent review revealed that in the external public debt database, there were a total of 18 contracts similar to the one arranged by the Anglo Leasing and Finance Company Ltd and from then on these loan contracts were labelled "Anglo-Leasing".

Investigations revealed that the contracting of loans similar to Anglo Leasing had been going on in the government for a long time.

EACC chairman Mumo Matemu said the individuals will appear in court anytime this week. He said more prosecutions are expected by the end of this month when his team is expected to cover gaps identified on two other files.

Last year, Kenya received evidence from the Swiss showing who was involved in the multi-billion-shilling scandal.

Attorney General Githu Muigai passed the evidence on to the EACC after receiving it. The EACC and the DPP then set up the Joint Technical Team that reviewed it.

Matemu said Tobiko donated some prosecutors to work alongside its investigators to fast-track and support quality investigations. Endi