Economy

Youth fund chair on the spot over Sh180m bank deposit loss

bruce

Youth Enterprise Fund chairman Bruce Odhiambo. PHOTO | FILE

Youth Enterprise Fund chairman Bruce Odhiambo acted unilaterally in appointing the suspended chief executive officer as the sole signatory to a bank account, resulting in the theft of Sh180 million, Parliament heard Tuesday

Mr Odhiambo was hard-pressed by MPs to explain why he went against a board resolution that sought to increase the number of bank signatories for the Fund investment accounts.

Instead, he went ahead to appoint Ms Catherine Namuye, a former CEO as the sole signatory to the fund.

“I acted unilaterally in accordance with what the management, through the chief executive officer asked me to do without board approval,” Mr Odhiambo admitted to MPs after tough questioning by Kikuyu MP Kimani Ichung’wa.

He sought more time to provide proper information after the Public Investments Committee (PIC) threatened to declare him a hostile witness and recommend his arrest for the loss of public funds.

It emerged that Mr Odhiambo and Ms Namuye side-stepped Chase Bank relationship manager Jedida Kabiru and dealt with the bank directors in transferring the millions of shillings.

Ms Namuye, who is under suspension, transferred the money in two instalments, 10 days after Mr Odhiambo wrote to Chase Bank informing its managers of the change of bank signatories.

“The chief executive officer can sign off any instruction. In the absence of CEO, two signatories must sign with one being a mandatory signatory,” Mr Odhiambo instructed Imam Hussein, of Chase Bank in a letter dated February 17, 2015.

He also gave the names of Ms Namuye and Ms Judy Kimeto, the lending and investment manager at the Fund as the signatories for class A accounts.

Finance manager Benedict Atavachi, Robert Mrima (senior accountant) and Benson Mutwi, an accountant, were signatories of class B bank accounts.

PIC demanded to know why Mr Odhiambo overstepped his mandate in sacking Mr Atavachi after he blew the whistle on the transfer of Sh115 million and Sh65 million to an account to Quorandum Limited, a firm that did not do business with Youth Enterprise Fund.

Mr Atavachi Tuesday said Chase Bank paid an interest of Sh8 million on the Sh400 million that had been invested in the fixed deposit account.

He said he could not access the bank accounts after the CEO was made the sole signatory and asked the House to probe the whereabouts of the balance of Sh220 million that was left in the account.

The MPs also questioned the circumstances under which Mr Odhiambo copied the suspension letter of Atavachi, a junior fund manager to former Devolution Cabinet Secretary Anne Waiguru and PS Peter Mangiti.

They said the mandate of suspending the officer belonged to the chief executive officer and not the non-executive board chairman.

The MPs are probing how Ms Namuye directed the withdrawal of Sh180.9 million from the fund board Chase Bank account number 001705460427 between February and April 2015 which went to Quorandum Limited for alleged consultancy services.

The fund had invested Sh400 million in Chase Bank fixed deposit account which was to mature in two months at an interest rate of 10.5 per cent.