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Home Crime Watch

How Ministry of Health paid controversial money to suppliers

by The Informer
January 23, 2017
in Crime Watch, News
Reading Time: 2min read
How Ministry of Health paid controversial money to suppliers

Health Cabinet Secretary Cleopa Mailu (R) and his Principal Secretary Nicholas Muraguri.

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Records at the Ministry of Health and the Kenya Medical Supplies Authority (Kemsa) over the ongoing Sh3.1billiion probe show suppliers were paid weeks after delivery of procured items, The Informer can authoritatively reveal.

According to Local Purchase Orders (LPOs), Kenya Revenue Authority (KRA) entries of imported items, delivery notes and invoices drawn by suppliers in our possession, Life Care Medics Limited received a total of Sh466million in two separate contracts.

The initial purchase order number 2347 dated April 4, 2016, Life Care Medics Limited received request to supply 16,963 emergency nutrition commodities at a unit cost of Sh11, 850 vide contract no:MOH/MTC/010/2015-2016NIN NO4 at a total cost of Sh201,011,550.

Consequently, KRA records show the items were imported in thirteen containers vide entry number 2016NBI 1468874 on May 13, 2016. KRA levied Sh32,476,235 as taxes.    On May 25, 2016, the Ministry of Health validated invoice dated May 13, 2016 drawn by Life Care Medics Ltd through LPO No:2614366.

The deliveries were made to Kemsa under reference No. 0182 and 0184 on May 13 2016 and subsequently provided an invoice No.004/2016 for Sh201,011,550 dated May 13, 2016.

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“Forwarded herewith, please find receipt documents for the delivery of medical supplies to Kemsa warehouse by M/S Lifecare Medics Limited.” A letter written to Principal Secretary Nicholas Muraguri vide Ref:KEMSAFIN/100 dated August 19, 2016 reads in part.

In the second order split in two, Life Care Medics supplied food supplements at a cost of Sh265,781,500 delivered to Kemsa through delivery note numbers : 0401, 0402 0404, 0406 and 0407.

The order was made on June 24, 2016, four days to the closure of fiscal year. The ministry wrote a letter of guarantee to Co-operative Bank in favour of Life Care medics.

The shipment were made in two different KRA entries 2016NBI 1496767 dated August 22 2016 and entry number 2016NBI 1495008 dated August 16 2016 respectively.

“We the undersigned wish to confirm pursuant to the above mentioned Letter of Credit Agreement, the Ministry indeed received the goods that were to be supplied by the above supplier.”

Muraguri told Co-Operative Bank of Kenya Ltd manager in charge of Trade Finance Services through a correspondence Ref:MOH/ACC/4/10/20 VOL.1/39 dated August 19, 2016.

The Sh201 million and Sh265million orders to Life Care Medics Limited were paid through Equity bank and Co-operative Bank respectively.    Businessmen Richard Ngatia Waweru, the co-owner of Life Care Medics Ltd, which was paid and Paul Wanderi Ndung’u denied any wrongdoing as claimed in the interim report.

Dentmed Kenya Ltd which received Sh2,992 ,490, Rayovac Industries Ltd Sh4,992,656 and Sundales International Ltd Sh41,000,000 also honoured the contracts in full.

Sundales international Ltd belongs to Kathleen Kihanya, Nyokabi Muthama and Samson Karimi.   Estama Investments Ltd supplied 100 Units of mobile medical clinics at a unit cost of Sh10million each vide contract number No.MOH/HQS/RT/019/2014-2015 of 17th July, 2015.

Estama Investments Ltd directors are listed as Ambrose Makanga and Esther Wahito who each have 500 shares.   The Ethics and Anti-Corruption Commission (Eacc) grilled directors of the companies adversely mentioned in the questionable payments.

Also, key ministry officials including Health Cabinet Secretary Cleopa Mailu and his Principal Secretary Nicholas Muraguri were questioned alongside Internal Auditor Bernard Muchere and ministry Chief Accountant Joyce Mutugi.  Eacc is yet make its report findings public.

According to MoH records seen by The Informer,  Sh3,121,061,247 is the total amount of expenditure which is subject to the interim audit.

The Informer

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