Explosive NYS Scandal: Court Blocks Billions, Firms Fight Back!

Published 17 hours ago4 minute read
Pelumi Ilesanmi
Pelumi Ilesanmi
Explosive NYS Scandal: Court Blocks Billions, Firms Fight Back!

The High Court has issued orders to halt the payment of Sh6.2 billion to various firms, including those linked to businessman Ben Gethi Wangui, who are implicated as suspects in the NYS Season One scandal. These orders were issued by Milimani Anti-Corruption High Court Judge Lucy Njuguna following an application by the Ethics and Anti-Corruption Commission (EACC). The EACC contended that the payments were fraudulent and illegal, asserting that no goods had been supplied to the National Youth Service (NYS) for these alleged ghost contracts.

In response, several companies have filed an application with the High Court, seeking to overturn the orders that prevent them from claiming over Sh6.2 billion from the NYS. Six of these firms are specifically linked to Benson Gethi Wangui and his associates. They are challenging the ex-parte orders issued by Justice Lucy Njuguna, which block the state agency from paying them Sh6,167,797,655 for items purportedly supplied between 2013 and 2015. The alleged supplies include boots, cooking oil, baked beans, sugar, rakes, helmets, T-shirts, army biscuits, and fuel.

The court's impugned orders specifically barred Gethi and his six associated companies—Highview Trading, Schoolwork Enterprises, Newtool Mart Trading, Ratego Technologies, Realtool Trading, Comptool Trading, Horizon Limited, and Jimchar Enterprises Limited—along with their agents or representatives, from claiming the Sh6.1 billion payment from NYS. Furthermore, the orders restrained NYS from processing payments related to vouchers serialized 000001–002901.

Through their lawyer, David Kirimi, the companies submitted an application under a certificate of urgency, urging the court to vacate the ex-parte orders and compel the EACC to release the original payment vouchers and Local Purchase Orders (LPOs), which the commission admits to possessing. The applicants argue that these orders were “draconian” and issued without full disclosure of material facts. They claim the court was not informed that they had submitted details for 21 LPOs to the Pending Bills Multi-Agency Verification Committee (PB-MAT), following a public call for pending bills incurred between July 1, 2005, and June 30, 2022.

The companies explain that they were unable to provide complete documentation because the original vouchers and LPOs have been held by the EACC for over six years since investigations commenced, and for two years after the Director of Public Prosecutions (DPP) advised that the inquiry file be closed. They contend that the EACC's continued withholding of their documents, coupled with the court orders barring payment claims, infringes upon Article 47(1) of the Constitution, which guarantees the right to administrative action that is expeditious, efficient, lawful, reasonable, and procedurally fair. They maintain that these actions threaten their right to be paid for goods allegedly supplied to NYS.

Further, the firms criticize the EACC’s application, asserting it seeks to preserve funds that do not exist. They state, “The plaintiff alleges a ‘real and imminent danger’ and ‘irreparable loss’, yet no funds have been paid out and no loss has occurred.” The applicants accuse the EACC of abusing the court process by presenting allegations as settled facts, noting the commission’s affidavits use terms like "established", “falsified”, and “fictitious” despite no trial being conducted, no charges approved by the DPP, and no payments made. They also reiterate the DPP’s directive to close the investigation file.

The companies also argue that under the Anti-Corruption and Economic Crimes Act (ACECA), freezing or preservation orders are only applicable to existing property or proceeds of corruption. They conclude, “Where no funds have moved, there is nothing to preserve.” Moreover, the applicants highlight that the pending payments had been scrutinized and verified by the cabinet-appointed Pending Bills Multi-Agency Team, of which the EACC was a member, and that this process was guided by an opinion from the Attorney-General and a Cabinet directive. They assert that all payments were approved, with the exception of Sh812 million.

In its court filings, the EACC counters by alleging that Gethi and his associates submitted claims for goods never supplied, colluding with NYS officials to falsify LPOs, delivery notes, stock control cards, and inspection forms. Officials named in the suit, including Samwel Mudanyi Wachenje, Bernard Kipkoech Yatich, and Julius Nyadimo Airo, along with others, are accused of signing or approving these documents despite knowing that deliveries never occurred. The EACC seeks a declaration that the claims are fraudulent and illegal, and requests that NYS be permanently barred from honoring the payment vouchers while investigations continue.

The listed owners and directors associated with the companies include Benson Gethi Wangui, Elizabeth Wangeci Ngugi, Samwel Mudanyi Wachenje, Bernard Kipkoech Yatich, Bernard Nzioka Kioko, Julius Nyadimo Airo, John Nganga Gicharu, Titus Trouble Libondo, Isaac Wafula Kundu, Jane Wangechi Gichuki, and Chemoss Kororia Ndiema.

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