Chairman of the Kenya Railways Corporation (KRC) board Mr Michael Waweru.
Detectives are investigating the chairman of the Kenya Railways Corporation (KRC) board Mr Michael Waweru for possible fraud, the Sunday Nation has established. This comes as boardroom wrangles rock the institution after a section of the board resolved to sack acting Managing Director Philip Mainga three weeks ago, a decision that was rescinded.
CONFLICT OF INTEREST
Multiple sources at the Directorate of Criminal Investigation (DCI) say that Mr Waweru is also being investigated for possible conflict of interest arising out of his chairmanship of Zamara Ltd (formerly known as Alexander Forbes) which manages KRC’s pension scheme. On Saturday, Mr Waweru said he was not aware of the investigations, which we have established began three weeks ago. “Incidentally, the DCI has not contacted me but they are very welcome,” he said.
Sources who spoke to us in confidence since the matter is still under probe, believe there is suspicion of conflict of interest since Mr Waweru chairs the board meetings of the two institutions, yet they are doing business together. Furthermore, they said they are looking into some questionable payment demands made by Zamara Ltd on KRC as well as the manner in which some of KRC’s pension scheme properties were offloaded by the pension manager.
Mr Waweru confirmed that he has been the chairman of Zamara Ltd long before he was appointed to chair the KRC board in June last year. “I have always disclosed my conflicts in meetings and right now Zamara’s contract has expired,” he said.
‘MISUSED POSITION’
An accomplished businessman, Mr Waweru served as the Commissioner General of the Kenya Revenue Authority (KRA) from 2003 to 2012. He is a former private auditor of retired President Mwai Kibaki. It was during his term at the helm of KRA when Mr Waweru popularised the use of container freight stations (CFSs). His alleged interest in one of the biggest CFSs in the country is also under scrutiny by the DCI detectives.
The sleuths want to establish whether he has misused his position to unduly influence the allocation of container cargo through the Standard Gauge Railway (SGR) to the Mombasa-based CFS. Of interest too to the investigators is how the freight company was allocated 20 acres of KRC land which is located next to the Nairobi Freight Terminal. Mr Waweru did not respond to our query on his alleged links to the CFS.
Apart from Mr Waweru, others to be questioned in the coming days in relation to the investigations are senior managers of KRC, the CFS and pension scheme managers. Sources also say that Mr Waweru engineered a board resolution to sack the acting MD Mr Mainga three weeks ago over alleged non-performance, a decision that they walked back on this week. On Friday, Transport and Infrastructure Cabinet Secretary James Macharia met the board over the attempt to sack Mr Mainga and board members are said to have abandoned the embattled chairman over the decision.
CONTROVERSIAL DECISIONS
“The board members said they passed the resolution after the chairman told them it was instructions from Mr Macharia, a claim that made the CS very livid,” said a source with close knowledge of the matter who spoke to us in confidence. After being deserted by his board members, Mr Waweru is said to have sought audience with a senior government official who reportedly told him off over the attempt to make changes without proper consultation at a time when there was a storm over the Standard Gauge Railway that required stability. On Saturday, Mr Waweru had this to say about MD’s sacking debacle: “Mr Mainga’s term comes up for review at the end of this month, and the board will act in accordance with KRC’s human resource policies.”
Senior government officials blame the board for some of the controversial decisions that the KRC has taken of late, including that which granted a company owned by the family of Mombasa County Governor Hassan Joho preferential rates to transport bulk cargo via the SGR. Kenya Railways cancelled the contract after an expose by this newspaper.
Source: Daily Nation