Parastatal CEOs face life ban in sleaze Bill

Executives and directors of State corporations convicted of corruption will get a life ban from serving in the public service and have their assets auctioned to recover lost funds if Parliament adopts a proposed law.

The life ban is an upgrade of the current law that currently bars those found guilty of economic crimes from holding public office for 10 years after their conviction.

The Anti-Corruption and Economic Crimes (Amendment) Bill 2019 seeks to have the executives and directors take personal monetary responsibilities for losses brought about by their corrupt dealings.

Currently, the State must prove personal benefit from graft before seizing assets, but the proposed law wants those in authority to pay back cash equivalent to the losses suffered via their economic crimes.

The proposed law change will offer the State powers to confiscate and auction properties belonging to those involved in graft so as to recover losses suffered by the parastatals.

"The principal object of this Bill is to amend the Anti-Corruption and Economic Crimes Act to hold managers, chief executive officers, directors of public institutions personally liable for running down institutions," reads the Bill’s memorandum.

"Further, it seeks to completely bar anyone convicted of an offence under the Act from holding office as a public or State officer."

The proposed law changes come as dozens of government officials, executives at State-owned firms and business people fight their prosecution for economic crimes and abuse of office in a new drive aimed at tackling widespread graft.

The high profile cases include Joe Sang, the managing director of Kenya Pipeline Company, and five of his colleagues who have been charged with the loss of funds in the construction of a fuel jetty worth Sh1.96 billion, a figure that exceeded the original budget.

Geoffrey Mwangi, the former CEO of the National Hospital Insurance Fund, his predecessor and 16 other officials were also charged with abuse of office in the irregular award and extension of a contract in which Sh1.1 billion was lost.

Former head of Kenya Power Ken Tarus was charged with conspiring to commit an economic crime, alongside his predecessor, Ben Chumo, and a number of other senior managers at the utility. They are accused of entering into a contract with a private firm for the supply of transformers, which turned out to be faulty. Prosecutors said this deal also flouted procurement rules for State entities.

But so far, the prosecution is yet to deliver high profile convictions.

A person found guilty of a graft offence is currently liable for a fine not exceeding Sh1 million or a maximum jail term of 10 years or both.

They also face a mandatory fine equivalent to double the quantifiable benefit they received from economic crime breaches.

The proposed law, which is before the National Assembly, seeks to introduce a new clause in the anti-graft law, placing personal liability on managers of State agencies or parastatals run down by corruption.

"A person who is convicted of an offence of corruption or economic crime and who was involved in the management of a public company, institution or State organ that suffered pecuniary loss as a result of that corruption or economic crime shall be personally liable for such loss," states the Bill. "A person who is personally liable under this section is jointly and severally liable in respect of losses incurred by the public company, institution or State organ with any other person who is so liable."