Israeli police have landed in Nairobi to investigate alleged bribery of top Kenyan Transport ministry officials by an Israeli construction firm in a move that promises to open up the dark deal-making boardrooms where multi-billion shillings roads tenders are awarded.
Tel Aviv-based construction group, Shikun & Binui, is under investigation for alleged bribery of Kenyan officials to win lucrative road contracts in Nairobi – setting the stage yet again for a possible unmasking of the corruption kingpins in government.
Shikun & Binui works in Kenya through its subsidiary Solel Boneh International Holdings (SBI Holdings), whose offices in Kenya were last week invaded and some of its bank accounts frozen to aid investigations.
SBI Holdings is the company that Nairobi picked to build the World Bank-funded Mau Summit-Kericho-Kisumu Highway at a cost of Sh14 billion in 2010.
SBI, which is one of the largest contraction firms in Israel, has been bidding for other lucrative construction projects in Kenya.
Israel Police on February 20, open investigations into the activities of Shikun & Binui’s former senior managers suspected of involvement in the bribery of public officials in Kenya to win big tenders.
SBI on Sunday confirmed that its Kenyan offices had been raided and searched by Israeli Police and added that was fully cooperating in the graft probe that could also get some top Kenyan transport ministry officials in trouble.
Kenyan authorities are yet to make public the investigations that could for the first time shine the spotlight on the procurement of international contractors for mega infrastructure projects in Kenya.
“On and after February 20, 2018, a number of current and former employees of SBI AG, Shikun & Binui and the Shikun & Binui subsidiary that holds its shares in SBI AG - including employees who had completed their work for the company over five years ago - were held for investigation or summoned for testimony by the Israeli police,” the company said in regulatory filings seen by the Business Daily.
“Some of those investigated were incarcerated for various lengths of time and/or released to house arrest and/or released with limitations,” the notice added while disclosing that Israeli police had also froze some of the company’s bank accounts.
SBI said the bank account freeze affected Sh5.7 billion in its accounts.
The reports indicate that the (Israeli) police had seized various bank accounts of Shikun & Binui and some of its subsidiaries holding more than NIS 200 million (about Sh5.7 billion).
The investigations also involved search and seizure of documents and other assets in SGI AG's offices in Israel and Kenya.
The Israeli firm said it had struck a deal with the investigators to have the accounts unfrozen subject to depositing of Sh7.18 billion with the Israeli police as a guarantee pending completion of the probe.
“On or near February 22, 2018, in an arrangement with the Israeli police, SBI AG deposited the dollar value of ~NIS 250 million (about Sh7.18 billion) into a closed forfeiture fund to secure the release of assets and bank accounts that had been seized,” the company said.
SBI said its own internal probe as well as that by the World Bank’s Integrity Office had been stopped to enable Israeli police complete its work.
“During January 2018, SBI AG was notified by the INT department of the World Bank, the department that investigates Integrity claims, that it intended to audit a number of SBI AG's completed projects in Kenya, some of which had been completed long ago,” SBI said without naming the projects.
SBI says it had begun fully cooperating with the World Bank, including gathering materials requested when Israeli Police moved in.
The search is expected to place a section of current and former Transport ministry officials under investigations over their involvement in suspected corruption.
The probe has turned the heat on those who served at the helm of the Transport and Infrastructure ministry at the time the suspect contracts were awarded.
The identities of the Kenyan officials who awarded the suspect contracts are yet to be made public.
Court documents have in the recent past shown how rogue employees of the Kenyan government manipulate the procurement law to inflate the cost of construction works and line their pockets with huge sums of money in form of kickbacks.
The Israeli police’s work in Kenya is expected to follow in the footsteps of the United Kingdom’s Serious Fraud Office’s (SFO) 2014 investigation into a British printing firms bribery of Kenyan election officials to will multi-million shilling contracts in a racket that was codenamed ‘chicken’.
While officials of the British printer Smith and Ouzman - chairman, Christopher Smith and the sales and marketing manager, Nicholas Smith, were convicted of the offence of corruption, their property confiscated and sent to jail, nothing has been done about the Kenyan officials, who received the bribes.