Amani National Congress (ANC) party leader Musalia Mudavadi has been dragged into the Sh1.3 billion Anglo-Leasing scandal.
Appearing before senior principal magistrate Anne Mwangi, Transport Chief Administrative Secretary (CAS) Chris Obure said that it is Mudavadi, who initiated the Anglo Leasing project when he served as Transport minister in President Daniel arap Moi’s Kanu government.
According to Obure, Mudavadi was involved in one of the Anglo leasing projects linked to the procurement of equipment for the Postal Corporation of Kenya (PCK).
“Mudavadi informed me that it was the government’s intention to develop and upgrade the Postal Corporation of Kenya (PCK),” Obure said.
Obure told the court that Mudavadi’s letter stated that the PCK was still largely dependent on Telkom Kenya, a situation that hindered its growth and profitability.
According to Obure, him and the former Transport Permanent Secretary Sammy Kyungu, were authorised by Mudavadi to sign the contract document on behalf of the ministry.
“I believed Mudavadi when he told me the government had embarked on a programme to upgrade postal services in the country,” he said.
He said Mudavadi asked him to offer him assistance in achieving the government’s goal.
Further, Obure’s testimony showed how Mudavadi sought his permission to use in direct procurement from a firm based in the United States of America.
They wanted to upgrade more than 900 post offices in Kenya.
“The new technology once put in place would ease the transfer of payment for teachers and other government entities,” he stated.
Among the equipment that were to be acquired included hardware, computer servers, software licenses, and other communication services.
At the time, Mudavadi was the vice president and Minister of Transport and Communication while Obure was finance minister under President Daniel Moi.
The case relates to one of the Anglo Leasing scandals in which 18 high-value government security contracts were allegedly awarded to fictitious companies leading to the loss of billions of shillings of public funds.
The accused are said to have conspired to defraud Sh6.5 billion through computerisation of police projects, acquire Sh121 million to modernise police surveillance systems, failed to comply with procurement rules and engaging in the project without proper planning.
It’s alleged the offence was committed between March and July 2002 when Obure was the Minister for Finance.
The prosecution alleges the late former Post-master General Francis Chahonyo and former Transport PS Sammy Kyungu were the initiators of the scam, Obure authorised the payments while Bundotich made the payments.
According to the charges, Obure granted special authorisation for execution of suppliers credit financial agreement between the government, Spacenet, Universal Satspace and First Mercantile Securities Corporation for data network project without due process.
Kyungu faced similar charges of abuse of office and breach of trust alongside the late Chahonyo.