Ethics and Anti-Corruption Commission (EACC) inquiry into allegations of conflict of interest and corruption in the acquisition of Telkom Kenya Shares by the Government of Kenya from Helios Investments Limited at a Cost of KSh. 6 Billion in the Financial Year 2022/2023.
Helios investors LLP paid Ksh 6 billion
Investigations by the EACC began after a complaint was received by the Commission in a letter from the Clerk to the National Assembly on 6th March, 2023 in regard to allegations of the irregular acquisition of Telkom Kenya Limited (TKL) shares by Government of Kenya (GoK) from Helios Investors LLP at a cost of KSh 6 Billion in the Financial Year 2022/2023.
Investigations established that the search for potential investor stopped when the former Cabinet Secretary, National Treasury wrote a letter dated 29th March, 2022, of GoK’s acceptance of Jamhuri Holdings Limited (JHL) decision to exit Telkom to GoK.
Investigations further established that the Communications Authority of Kenya did not grant approval for acquisition of 60 percent shares of Telkom Limited by the GoK in the transaction under inquiry since part of the conditions given by the Authority were not met by Telkom Kenya Limited.
Purchase of shares did not meet threshold
Investigations revealed that despite the correspondences between the former Attorney-General (AG) and the former Cabinet Secretary (CS) National Treasury, the office of the AG did not issue legal opinion, neither were the AG’s comments and advice incorporated in the contractual documents.
Investigations also revealed that the acquisition of shares by GoK from JHL did not meet the threshold as provided in Regulation 40 (3) and (4) (a) of the Public Finance Management (National Government) Regulations, 2015 since the transaction was not unforeseen and unavoidable.
10 former officials could be charged
On 29th August, 2023 a report was compiled and forwarded to the DPP with recommendations to charge the former Cabinet Secretary (CS) for the National Treasury, the former Principal Secretary (PS) at The National Treasury, the Controller of Budget, former Director General Public Investments and Portfolio Management, Chief Executive Officer at Telkom Kenya Limited, Chairman of the Telkom Kenya Limited Board, Chief Operating Officer, Chief Strategy and Business Development Officer and Chief Finance Officer at Telkom Kenya Limited and a transaction advisor for Helios be charged with the following offences;
• Conspiracy to commit an offence of economic crime contrary to section 47A (3) of ACECA;
• Fifteen counts of abuse of office contrary to section 46 of the ACECA;
• Two alternate counts of wilful failure to comply with the law relating to the management of funds contrary to section 45(2) (b) as read with section 48 of the ACECA;
• Alternate count of entering into an obligation that has a financial implication contrary to section 196 (3) as read with section 196 (6) of the Public Finance Management Act, 2012;
• Conflict of interest Contrary to section 42 (3) of ACECA;
• Two counts of wilful failure to comply with the law;
• Deceiving Principal contrary to section 41 (2) of ACECA;
• Fraudulent acquisition contrary to section 45 (1) (a) all as read with section 48 of ACECA;
• Three counts of money laundering contrary to section 3 of the Proceeds of Crime and Anti-Money Laundering Act, 2009;
• Six counts of Acquisition of Proceeds of Crime contrary to section 4 both as read with section 16 of the Proceeds of Crime and Anti-Money Laundering Act, 2009;
• Neglect of official duty contrary to section 128 as read with section 36 of the Penal Code.
The Director of Prosecution’s response is awaited.
Source: Kenya Gazette, 8th December, 2023