Treasury PS Kamau Thugge accused of giving EACC illegal report for Anglo Leasing

Treasury Principal Secretary Kamau Thugge swears by the Bible before testifying at the ongoing Angloleasing case hearing at the Milimani law court on Wednesday,July 5th , 2017 . Picture; George Njung

The Treasury principal secretary was yesterday taken to task for relying on an illegal audit report to instigate investigations into the Anglo Leasing scandal.

Kamau Thugge (right) stated he was not aware that a 2007 PriceWaterhouseCoopers (PwC) audit report that he relied on to convince the Ethics and Anti-Corruption Commission (EACC) to start fresh investigations into the scandal had been declared illegal by the High Court.

“I was only responding to requests by EACC that we provide them with information relating to Anglo Leasing. That is why I gave them a report in 2014 suggesting ways to recover the money based on the PwC audit. I did not know that it was declared illegal,” said Dr Thugge.

The PS was testifying in a case in which former permanent secretaries Dave Mwangi and Joseph Magari, former head of debt management David Onyonka, businessmen Deepak Kamani and Rashmi Kamani are charged with conspiracy to defraud the Government through the Anglo Leasing contracts.

Thugge stated that Treasury did not seek legal interpretation to determine whether the PwC audit report could be used as evidence.

Riddled with irregularities

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The report was prepared in 2007 and recommended that the Government initiate a process to recover money paid to companies associated with Anglo Leasing contracts and that action be taken against Government officials who participated in the signing of the contracts.

But the findings were challenged in court by Midlands Finance Security Ltd and the High Court ruled that the report was riddled with irregularities and should not be used as a basis for investigating the scandal.

Asked whether the Kamani brothers were part of the contract between the Government and Sound Day Corporation, Thugge said their names did not feature on the document.

“The Kamani family was not part of the contract between the Government and Sound Day Company. The records we have show that all payments in relation to the contract for modernising police operations were made to the company,” said Thugge.

He said the Government paid a 3 per cent commitment fee to the company after the contract was signed and added that funding for the contracts was part of external loans approved by the Treasury.

He said it was normal for the Government to borrow external money to fund some projects.

Thugge said the promissory notes paid by the Government were unconditional and valid and that the Government is still legally bound to pay the company. 

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