Aug 9, 2022

Mawazo Writing Africa

Writing about the main

The foremost tenderpreneur: Charles Njonjo and the CMC offshore scandal

As a symbol of power, this attracted admirers and enemies in equal parts. Njonjo, at least in the public prosecutor’s office and later in parliament, was combative. Few could challenge him.

Once upon a time – in April 1982, Ugenya’s MP James Orengo annoyed Njonjo by saying he “dress like the queen’s butler”.

One That afternoon that April, Mr. Orengo was on the floor of the house when Njonjo came in. Then Orengo quipped: “The treasure. A member of Kikuyu just walked in and I almost thought I would see the queen’s butler walk into the house. ”

Orengo hadn’t forgiven Njonjo for forcing him into exile in Tanzania. The previous week Njonjo had used the term “five bearded sisters” – perhaps in allusion or as a joke at some government critics who discovered all beards.

Although he later denied and claimed that he was referring to the ” Seven Sisters ”- a derogatory term used in the 1970s and 1980s to refer to the seven oil companies that dominated the world market – had not escaped observers that it referred to Orengo, Koigi Wamwere and Abuya Abuya. and not the oil cartels.

Master of hubris

Njonjo, like these oil cartels, knew where to make money. But when the money poured on his side, Njonjo became the master of hubris.

He was one of the most powerful kings in the government of Jomo Kenyatta and the kingmaker of the Nyayo regime. But how did a civil servant become a billionaire after only 20 years of employment? What was his Midas touch? Let me know what is known.

In the history of government contracts, Njonjo was a pioneer: the ultimate tender preneur. It later haunted him and his other ally, Jeremiah Kiereini.

Njonjo died last Sunday while still struggling to get out of a Jersey Island case involving secret offshore accounts , he and some directors of CMC Motors had opened there, and where over-billed revenues were deposited from overseas firms involved with the car dealership.

That case that always preoccupied him revealed Like Njonjo and his allies, other CMC Motors shareholders were betrayed for their own benefit.

It was a plan that began in 1977 and lasted until 2011 when it rocked the boardroom of CMC that they were a South African The company had to carry out forensics examination. The Webber Report concluded that CMC has lost billions of shillings over the decades that Jack Benzimra, Jeremiah Kiereini and Martin Forster were in charge.

Since its inception in 1948, CMC has been active in the auto trade and was the supplier of British Land Rovers first to the colonial Kenya government and later to the governments of Jomo Kenyatta and Moi.

This was a billion dollar business, as Land Rover had no known competitor in the region . It was also the symbol of colony, power, and government power. But for Mr. Njonjo and his allies within CMC, it was the cash cow – the ultimate path to wealth.

Buying government cars

Njonjo and his friend Jeremiah Kiereini were CMC of Kenyatta’s former Bruce McKenzie, Secretary of Agriculture, was introduced, and for good reason. As permanent defense minister, Kiereini had the general say in buying military land rovers, while Njonjo, as attorney general, was the legal gatekeeper.

You weren’t the only senior officials investing in companies doing business with the government . Another company consisting of Njonjo, Kiereini, Treasury Secretary Mwai Kibaki, Central Bank Governor Duncan Ndegwa, and Julius Gecau, then chief executive of the East African Power and Lighting Company, (and several others) had also registered Heri Limited, the shares of DT Dobie. bought that franchisee from Mercedes Benz. In addition to selling luxury vehicles to the government, DT Dobie also sold trucks to the Department of Defense.

How much revenue these officials generated from their influence in government can only, and interestingly, be estimated years later, they didn’t seem like that To be of the opinion that there was something wrong with this agreement.

“By forming this investment company (Heri Ltd) we had no hesitation in buying shares as we were not involved in either running the business or the Management decisions, “Kiereini later revealed in his autobiography A Daunting Task.

Back to CMC, and from the scanty documentation available, the car dealer had determined that more than 5 million pounds (640 million shutters) had been made the secret slush fund paid to board members – financed by excessive invoice prices for imported vehicles and parts from Kenya’s largest vehicle importer and large tem auto assembly company.

Monetary scheme

As the court is informed, Njonjo and Kiereini and two other CMC directors, Jack Benzimra and Prahlai K. Jani, hatched this monetary scheme.

It was a simple plan, as the court documents showed: the overseas automotive suppliers and spare parts would charge CMC Motors for amounts in excess of the actual price and the Kenyan company would pay the inflated bill.

The overseas supplier would then transfer the additional amounts to bank accounts in Jersey on behalf of the incorporated companies at the request of the conflicting directors. As a result, those who had no idea about the Jersey accounts were defrauded.

It is now known that the group had set up a feeder bank account on behalf of Corival in Jersey and that was funded by that of the amount overcharged by the manufacturers. They had also formed the Fair Valley Trust at the National Westminster Bank in St. Heiler, Jersey, which received the funds deposited in the Corival account, and that trust later distributed the funds to accounts or companies associated with those directors.

It is not clear whether Mr Njonjo and Kiereini received other funds from other defense and security arrangements during the time Kiereini was Permanent Secretary in the President’s Office, Head of Public Service and Permanent Minister of Defense. But that might explain why the two officers were filthy.

The Jersey account was so scandalous that Corival posed as a moneylender when CMC was in need of money, and CMC would borrow some money to help the more inflated ones Vehicles to buy! Njonjo was a signatory to that account, and CMC would also pay interest on the Corival loan.

When CMC (the publicly traded company) filed the case in Jersey, it sought orders against two Jersey companies – the RBC Trust Company (International) Limited and The Regent Trust Company Limited – on the grounds that they had “dishonestly helped” both Njonjo and Kiereini and demanded that these companies “contribute all amounts to the program due to their dishonest help.” have been paid for these violations, (CMC) to account ”. fiduciary duty “.

Litigation

The case in Jersey was hampered by litigation over the whereabouts of some documents that could help prosecute and determine the amount of the payment.

Two years ago, the Royal Court of Jersey ruled that “given that part of this scheme involves paying secret commissions resulting from an over-invoicing agreement … (CMC Holdings) every element must do this Establish Operation. “

” Once you establish the existence of the system and the payment of funds to the Jersey companies, you must also demonstrate that it was a breach of duty by the Directors to prove that the Second and third defendants were aware of the fact that the Plan was created in violation of the Directors’ obligations to plaintiffs, and in light of that knowledge, plaintiffs in the allegation The court said in a case in which Kiereini and Njonjo are third-party defendants Safe found a secret file containing details of offshore accounts that only a few directors knew about – and few benefited from it. The audited accounts were usually dumb on these offshore accounts.

Martin thought how he would later claim that the funds on this account belonged to CMC, and that was why he left the file in the safe when he was fired from CMC on March 14, 2011. He also benefited from these accounts, making a total of £ 142,750, or 26.4 percent of the £ 538,684 disbursed between 2008 and 2011. It is unknown whether there were any other accounts besides the 1999 accounts , since the Scheme was dated to 1977.

It is also known to be Jack M. Benzirma, a former chairman of the auto dealership (deceased) who originally founded the Fair Valley Trust “for the benefit of the former, current and future employees of CMC “.

It was a lie.

But what we learn from this Njonjo, Kiereini saga is that people have abused their positions for years in order to Earning money in government – and we have accepted that as a virtue.

Ndegwa Report

Two years ago, President Uhuru Kenyat ta promised to revise the Ndegwa Report of 1971, whose clause 32 allows civil servants to do business.

It was this clause 32 that gave politicians and civil servants a free pass predatory behavior and which still today gave cartels and kleptomaniac politicians some hints on how to become billionaires overnight despite the meager salaries of civil servants.

The first beneficiaries were those who pushed for the implementation of the Ndegwa report , with Njonjo as legal advisor. The proposed office of Ombudsman to review bad manners and abuse of power never materialized. And so the seeds of corruption were sown and today we have not just a tree, but a forest.

So when the history of treaties is written within the government, it begins with the Ndegwa Report and the name of Charles Njonjo are displayed. The Ndegwa report not only cemented the dirt, it cleaned up corruption as a business. Today’s kings of sleaze learned their art from the best of these pioneers.

The words of former US President Theodore Roosevelt (1858–1919) are remembered: “A man who never went to school is can steal a freight car; but if he has a college education he could steal the whole railroad. ”

[emailprotected] @ johnkamau1