Wealthy former Governor of Nairobi City County Dr. Evans Kidero risks losing a luxurious apartment located in the upmarket Riverside Drive in Nairobi. This after the lead anti-graft agency, Ethics and Anti-Corruption Commission (EACC) moved to court to recover funds allegedly stolen from the Nairobi City government, and traced to the flamboyant former Governor through an intricate money paper trail.
EACC has moved to the anti-corruption court where the anti-graft body revealed an intricate paper trail of cash allegedly stolen from the Capital City government and traced back to the former Governor. The money was injected into the construction of upmarket luxurious apartments located in Nairobi’s Riverside Drive owned by the former Nairobi City Governor Kidero.
The money, amounting to Kshs.14.4 million, is a part of the Kshs. 58.8 million, which City Hall is said to have lost in a case filed by a non-existent company, Kyavee Holdings, against the defunct Nairobi City council over a botched land deal. The cash was allegedly wired to 10 people, with the Governor as one of the beneficiaries. EACC wants the money refunded or it be allowed to seize the assets including land and cars of the accused persons.
The anti-graft agency revealed that part of the loot from the fake legal contract was sent to the former governor on January 7, 2014 through a company known as Cups Limited, which is associated with Dr Kidero’s past chief of staff George Wainaina.
Dr Kidero, the EACC says, wired his share of Sh14.4 million a day later to Virji Meghji who was involved in construction works of the governor’s Gem Suites in Riverside. The apartments are said to attract rent of Ksh.540,000 monthly.
The commission launched a court bid to recover the Kshs.14.4 million and is alternatively seeking one of the apartments to be held in trust on behalf of City Hall.
“In the alternative and without prejudice, a declaration that the plaintiff (EACC) is entitled to trace the aforesaid amount… into serviced apartments (known as Gem Apartments) on land parcel known as LR. No 205/46 within Riverside Area, in Nairobi County and that the 1st defendant holds the property in trust for the county government of Nairobi,” says the EACC in court documents filed at the anti-corruption court.
A law firm, Wachira Mburu Mwangi & Company Advocates was instructed to represent City Hall and sought millions of shillings for legal fees. Documents filed in court by EACC showed that Kshs.58 million was paid to the managing partner of the law firm, Mr. Stephen Mburu, as legal fees in the fake legal contract.
Upon receiving the money, Mr. Mburu retained Kshs.11.5 million then distributed Kshs.7 million to John Ndirangu Kariuki and Kshs.15 million to Cups Ltd. Cups Ltd then sent Kshs.14.4 million to Dr. Kidero, who allegedly transferred the money to Mr. Meghji. Mr. Mburu has since died.
Other persons who are alleged to have received the City Hall funds are Paul Mutunga Mutungi, a former City Councillor, Runa Insurance was paid Kshs.10 million and Kshs. 5.5 million to Hannah Muthoni, the wife of Mr Mburu, the now deceased lawyer.
EACC’s David Ruto said although Mr Wainaina said he wired the money to Dr. Kidero to buy a Toyota Lexus, investigations revealed that the vehicle already belonged to the former governor.
The prosecution maintains that all the accused persons conspired to commit an economic crime through a choreographed scheme to siphon public funds. Dr Kidero is accused of being a beneficiary of proceeds of crime and unjust enrichment through the Kshs.14.4 million pay-out.
“The legal fee claim was a fraudulent scheme set to defraud the county government of Nairobi as the said fee claim was founded on false claim, by a non-existent company and intentionally filed by an unqualified person with the intention of rendering the suit incompetent,” the EACC says.
The intricate web started after Kyavee Holdings, the agency, claimed to have been allocated a plot of land measuring 1.720 hectares for Kshs. 536,667 from January 1968 in Nairobi’s South B area. The company then said it had planned to develop a four-star hotel but in 1999 the land was allocated to a third party, who developed it. Ms Kyavee then sued the defunct City Council demanding Kshs.3.1 billion for loss of profits. The suit was later withdrawn, paving the way for settlement of the legal fees Wachira Mburu Mwangi & Company Advocates, the law firm which then distributes monies to the accused persons.
The prosecution says Kyavee Holdings was a ghost company because the land which was allegedly allocated to it in South B was not available as it had been allocated to Mariakani Primary school.
External auditors had raised questions over the Kshs.58 million pay to Wachira Mburu and requested that the payment be frozen. Despite the recommendation, City Hall went ahead and paid the money during Dr Kidero’s tenure as governor.