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Daniel Manduku to be arrested in New KPA Scandal

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(Photo: KPA Boss Daniel Manduku with Governor Ali Hassan Joho)

Kenya Ports Authority Managing Director Daniel Manduku is set to be arrested in new KPA scandal that involves the Moi’s family.

The blunder of the KPA MD Daniel Manduku has seen wealthy son of former President Daniel Arap Moi, Senator Gideon Moi, under DCI probe over sh70 million KPA scam.

The never learning Manduku awarded a sh70 million tender to a company associated with Senator Gideon Moi to construct a peripheral cargo storage facilities on behalf of KPA next to the inland container depot(ICD) which is based in Nairobi.

The peripheral storage facilities are currently being used to store cargo which have overstayed at the ICD in order to reduce congestion

The KPA MD Daniel Manduku is being probed for issuing a directive that would later benefit cartels who created cargo delays at the Nairobi depot, leading to an outcry by importers that they were losing up to Ksh70 million daily on storage and detention charges due to cargo pile-up at the ICD.

This Prompted President Kenyatta’s visit to the cargo depot where he said the drama at the port is as a result of people who want to evade paying taxes,

“There are people who engage in consolidation. They bring goods in containers, claiming they are in transit while their real motive is to evade paying tax. That is not right and we will not allow it.”

The head of state added that, “Many times our traders operate without knowledge of the government procedures and we would like all boardroom decisions disseminated to the traders,”

It’s after this incident that the head of public service wrote a memo to government agencies at the ICD ordering them to reduce their presence at the facility, further directing Kenya Ports Authority (KPA) to lease storage facility outside the ICD.

This is what attracted 30 companies except for Senator Gideon Moi’s(Mitchel Cotts limited) and Nairobi Inland Cargo Terminal companies that never applied for anything but were illegally awarded tenders one year after a push to clear cargo at the ICD was made in mid-2018.

For starters, Mitchel Cotts limited is a firm linked to Gideon Moi and his father’s long time aide Joshua Kulei.

DCI is now on the kneck of Senator Gideon Moi whose company was not even among the 30 companies that tendered for the contracts after the government insisted that cargo be cleared in Nairobi.

Already KPA Managing Director Daniel Manduku and Kenya Revenue Authority Commissioner for Customs Kevin Safari appeared before the DCI for probe at their headquarters.

It is reported that Kevin Safari and several officials from the Customs and Border Control Department at KRA spent their Thursday last week at the DCI headquarters located at Kiambu Road, Nairobi.

Speaking after the probe Kevin Safari told a local daily that “It will be good to note, however, that the role of issuing contracts for the peripheral storage facilities is a KPA role. KRA only inspected the facilities before they were commissioned, as required by law.”

It’s not clear when Baringo Senator Gideon Moi whose company won a tender unfairly will be invited by the DCI for grilling.

Manduku, a close associate of Deputy President William Ruto, is not new to controversies. He found himself in hot soup last year after a whistleblower by the name Joseph Okhako accused him of overseeing shoddy tenders, crooked internal works and protecting officials facing corruption allegations, while in some cases promoting them.

The former KPA acting head of Ethics and Integrity Joseph Okhako accused the management led by Dr Manduku of entertaining corrupt deals, sinking a Sh6 billion hole into the agency.

He questioned the management decisions with regards to Sh101 million roofing of the headquarters contract awarded to Zunaksha.

“KPA did water proofing several times at the headquarters, what is the urgency this time around, just after doing proofing less two years ago?” he questioned.

Some internal works, such as repainting of the headquarters at a cost of Sh79 million also raised eyebrows. The firm involved in the latest painting award was identified as Sanjud Enterprises belonging to one of the cartels in Manduku’s circle.

Also in the list of questionable contracts is the modification of procurement stores by Lexbert Enterprises at a cost of Sh83 million. The purpose for the modification was not clear.

In another case, Mr Okhako questioned why KPA interdicted artisans and low-level staff, leaving behind those who recommended and approved the payments of a fresh water project where KPA allegedly lost Sh35 million.

“The names of senior staff were removed from the disciplinary records and innocent artisans left on the list to carry the cross of their bosses. It is a pity to see innocent junior officers suffering while the main suspects are free,” Mr Okhako said.

Mr Okhalo also questioned the construction of a water tank at a cost of Sh84 million at the headquarters. This was after the port refused to pay some of the suppliers after an internal audit unearthed discrepancies that included inflated and fictitious water deliveries.

“How do you do concrete works, spending millions of shillings, then come back and destroy the same concrete to build a water tank? Surprisingly, there is yet another unutilised tank at the same venue next to the same car park,” he stated.

Mr Okhako also accused Dr Manduku of working with ‘his right-hand man’ to bend procurement rules.

Mr Okhako said he tried approaching the managing director to discuss concerns over claims that he was directly benefiting from circumventing the procurements system in favour of proxy companies but in vain.

“There is a claim by staff in civil and finance departments that procurement rules in civil and concrete works are being breached to enrich Dr Manduku, and two others.”

Mr Okhako cited a presidential circular 1/2018 which requires that if a public entity awards a contract, it should be displayed on its website showing name of the company, its directors, amount of the award and method used to procure.

“How come most of these contracts have not been reported to the relevant regulatory agency, and they are not on Ifmis and KPA website? How come they were not budgeted for in 2018- 19 FY?” he questioned.

He also cited the transfers of senior KPA staff as a “punishment by Dr Manduku to officers who refused to toe his line”.

The managing director Dr Manduku is said to have perfected the transfers of the officials who were spearheading integrity drive at their departments, hence exposing the agency to corruption deals.

Another scandal is the controversial tenders worth sh2.7 billion, an expenditure that was made without its authorisation.

The KPA officials had in a letter dated January 30, 2019 sought the approval of Treasury to shift Sh2.5 billion of the Sh3 billion previously set aside for buying a piece of land at the Inland Container Depot in Nairobi and use Sh500 million to concrete the Makongeni yard and Sh2 billion for dredging the port.

In a letter dated November 22, 2019, the Treasury says the money was spent before approval of the supplementary budget.

While treasury had received the proposed budget, the Principal Secretary Dr Muia said, the proposal was subjected to “rationalisation”.

“The Cabinet secretary Ministry of Transport and Infrastructure was to grant approval for the request and subsequently seek the concurrence of the National Treasury … there was no prior approval for Kenya Ports Authority management to procure … before approval of supplementary budget 2018/19 FY,” Principal Secretary Julius Muia said in the letter.

The recommendation for approval was given on September 24, 2019 but by this time, the money hungry Dr Manduku had already awarded the tenders and paid for the Makongeni works without knowledge of the Treasury.

According to documents seen by 254News, nine contractors were given the tender. The tender was split in smaller portions to skirt legal requirements for tendering for capital projects and to disguise it as repair works.

The nine bills of quantities were prepared by a senior works officer, Anthony Muhanji, and the total contract sum was Sh506 million.

This was “a clear conspiracy to avoid tender procedures, to wit, section 91 of the public procurement and asset disposal act … and with the aim of avoiding open and competitive tendering process.” a report by detectives read in part.

The Makongeni work is controversial because the Kenya Railways Corporation (KRC) claims that it owns the land and had not entered into a lease agreement with KPA after negotiations collapsed.

According to detectives, the Nairobi Makongeni assignment was not only unprocedural but also “some items were paid for and yet some works were not done”. The items paid for include, “cement stabilised coral rags, dowel greased joints and dowell capped joints”.

They also established that the total area of concreted yard is 20,486 square metres while the contracted area was 25,835 square metres.

Further, “There was no value for money paid. The value of work done amounted to Sh349.2 million against a payment of Sh480 million. There was an overpayment of Sh125 million. We shall recover these amount from the contractors,” 

Investigators have termed this as “wastage of public resources,” saying Dr Manduku and other senior officers should take responsibility.

Dr Manduku have not attempted to explain why KPC moved ahead to develop a plot it didn’t own.

KRC is now demanding KPA to vacate its plot and restore the uprooted railway line, meaning that KPA cannot use the facility even after sinking Sh500 million into it.

And for Kisumu port procurement saga, the Treasury in November 22, 2019 described the entire procurement as unprocedural.

“As per the Public Procurement and Disposal Act 2015, procurement should not take place before budgetary approval. KPA is required to comply with this legal requirement.”

Remember treasury only approved Sh100 million for the Kisumu revitalisation works for the 2018/19 financial year but as mid last year, the works with a total contract sum of Sh803 million has been awarded for the Kisumu project.

Records also indicate that for the 2019/20 financial year, the project had been allocated Sh500 million but this had not been approved. Also, there was no evidence of competitive bidding, and the works done had been priced by KPA and directly awarded to the contractors. 

In their report, detectives said that “despite the knowledge that only Sh100 million was available for the Kisumu works, the managing director authorised expenditures amounting to Sh803 million which indicates that he engaged without an approved budget.”

Dr Manduku had told investigators that he had received a presidential directive to fast-track the Kisumu works, but according to investigators, “He was unable to explain as to whether the said directive directed him to overlook procurement procedures”.

Adding, “KPA was to undertake the project within the legal provisions governing procurement”

In his letter to investigators, the Treasury PS says that KPA should have sought approval “If the total contract price exceeded 25 per cent in compliance with Section 139 of Public Procurement and Disposal Act, 2015. The National Treasury did not receive any request for variation of this project.”

There were also claims that through the blessings of KPA boss Daniel Manduku, a total of 13 companies were contracted by KPA to construct 1380 barriers at a cost of Ksh109,305,739 per company. The barriers which normally cost Ksh10,281 per piece were priced at Ksh79,193 per piece. A total of Ksh1.4 billion was lost in this concrete barrier scam.

During this period Dr. Arch. Daniel Manduku, the KPA Boss and Adventist by faith bought a resident apartment, formerly Apua, in ongata Rongai, Umoja Road at only Ksh85 million. The apartment is currently run by his younger brother Yusuf Maraga through a house agency called Yellow House Properties.

The highly religious man and a SDA Church Elder Daniel Manduku has tried to stop his prosecution, investigation by DCI and DPP, and even the media from unearthing his iniquities.

In early December, he successfully obtained orders from court that was issued by Justice Eric Ogola that barred the Director of Criminal Investigations (DCI) and Director of Public Prosecution (DPP) and Inspector General (IG) of police from arresting and prosecuting him.

Justice Eric Ogola issued Dr. Manduku a 14 day free bond pending his ruling on whether to stop the DCI from arresting and prosecuting him in the ongoing investigations over fraudulent tenders for various projects at the port.

In December 17, 2019, the Director of Public Prosecutions (DPP) sought to have Senator and Senior Counsel James Orengo barred from representing Kenya Ports Authority (KPA) managing director Daniel Manduku citing conflict of interest.

Those on the know claim that Senator Orengo who has won several controversial cases in Mombasa Law courts including that of Governor Ali Hassan Joho’s academic credentials, is a well connected man in the judicial corridors. It is alleged that Senator Orengo was once spotted with one of the judges of Mombasa high court ahead of the ruling pertaining Governor Joho’s academic credentials.

Powers behind Manduku

If the DCI, DPP would have continued with their initial paces, the KPA Boss Daniel Manduku would have been behind bars. But what has slowed the process? Well, it’s alledged that Mama Ngina, President Uhutu Kenyatta’s mother is in the mix of those who have received contracts at the port.

It’s also alleged that Dr Manduku awarded Joho’s firm Autoport Freight Terminals Limited preferential tender for cargo transportation using SGR.

Jaffer family (owners of the Grainbulk Handlers Limited – GBHL) also received a share of the Ksh1.2 billion conveyor belt system installation tender at the port.

This could be what triggered the Moi’s family to also find something at the ICD.

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