Mr Francis Nyenze, who chaired the pyramid schemes task force. Photo/FILE
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Very little had been done to implement the resolutions of prosecution, seizure of assets and compensation of the victims, says MP David Gikaria.
The MP had sought to know the status of the implementation of the report of the task force then chaired by current leader of Minority Francis Nyenze, compensation for victims and prosecutions of directors of schemes.
A House team has threatened to sanction Cabinet secretaries who fail to implement resolutions after it emerged that 2004 victims of pyramid schemes are yet to be compensated for losses running into billions.
Despite preparation and passing of the pyramid schemes report, MP David Gikaria, the Implementation Committee chairperson, said very little had been done to implement the resolutions of prosecution, seizure of assets and compensation of the victims.
“Other than the ministry putting in place measures to stop pyramid schemes from happening again, very little has been done to implement the House decision,” he told Malava MP Moses Injendi.
The MP had sought to know the status of the implementation of the report of the task force then chaired by current leader of Minority Francis Nyenze, compensation for victims and prosecutions of directors of schemes.
Investors of the pyramid schemes lost billions of shillings when the schemes collapsed in the year 2004/2005 leading to the formation of the probe team.
Mr Gikaria told Parliament that despite investigations by the office of the Attorney- General, Director of Public Prosecution, the Central Bank of Kenya banking fraud unit and the ministry of cooperative, suspects of the pyramid schemes were acquitted by the courts and some awarded compensation for wrongful prosecution.
He said 11 cases were taken to court but were completed without any convictions.
“Others were given compensation by same courts,” Mr Gikaria said and blamed victims for failing to come out to testify or make claims against funds that were frozen.
“There are indication from the ministry of industrialisation and Enterprise that recoveries from accounts/directors were not made due to court cases. The Cabinet secretary told the committee that Sh11.8 million was withdrawn after lifting of freezes on accounts by the courts,” the Nakuru Town West MP said.
He said matters were complicated by the lenient penalties stipulated in the Banking and Microfinance Acts.
“Fines were payable to the State and not pyramid scheme victims. It is our recommendation that the CBK should fast track changes to legislation on pyramid scheme to provide for stiffer penalties.
“The Attorney General, the Treasury and industrialisation ministry should establish information centres for victims to register their case,” he said.
MPs Robert Pukose (Endebes) and Samuel Gichigi (Kipipiri) demanded to be told why the victims were not compensated through the money CBK froze from accounts of directors of the pyramid schemes.
The Committee on Implementation noted only two cabinet secretaries had filed status reports on the implementation of 29 House resolutions.
House Standing Orders require the committee to seek the status reports on implementation of resolutions adopted by MPs 60 days after passage.
Relevant Cabinet secretaries are required to file quarterly reports to Parliament indicating what the government has done to implement the decisions of the House.
“We have scrutinised 29 House resolutions but we have only received two status reports from Cabinet secretaries responsible for Industrialisation and a commitment by the leader of Majority Aden Duale on the increased prostitution in the universities,” said Gikaria.
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