Transport Cabinet Secretary James Macharia is under anti-Corruption limelight after a Kenyan News Day investigation emerged he negotiated huge kickbacks from a major Chinese contractor using a notorious Nakuru-based businessman Samuel Mburu as middleman, Kenyan News Day can authoritatively reveal.
Mburu is Deputy President William Ruto’s close business associate and who is out on bond for an outstanding case for tax evasion.
Last week, CS Macharia narrowly escaped an impeachment motion by Nyali member of parliament Mohammed Ali. Our investigations have revealed explosive findings relating to mega-bribery, tax evasion and possible importation of contraband.
Today, the controversial CS stands accused of disregarding public procurement laws, failing to conduct due diligence for safeguarding public interest, and participating in an elaborate bribery and kickback scheme connected to the infamous contractor China Road and Bridge Corporation (CRBC).
Kenya News Day investigations relating to the malfeasance by Macharia can be traced back to 2018 when he was appointed as substantive CS in the Transport, Infrastructure, Housing and Urban Development docket.
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Since then, Macharia had variously visited China and held secret meetings with executives from CRBC over the numerous multi-billion infrastructure projects controlled by his docket.
Those talks culminated in a surprise announcement by the CS that, rather than competitively tender for the works and get the tax payer value for money, the Sh65 billion Nairobi-JKIA expressway contract would be unilaterally awarded to CRBC on a public-private partnership (PPP) basis.
A source at State House told Kenyan News Day that CS Macharia had managed to persuade President Uhuru Kenyatta into accepting CRBC as part of legacy project. The 18.586-kilometre road project starts at JKIA and terminate at James Gichuru, along Waiyaki Road, in Westlands before the general elections.
As observers were questioning the rationale for single sourcing CRBC in an opaque PPP deal , it also emerged that CS Macharia had awarded CRBC a massive concession of 30-years to charge road users toll on the expressway until they recoup their investment in the project.
Incidentally CRBC are the same firm that were singularly sourced to build the highly inflated Sh327 billion Nairobi – Mombasa Standard Gauge Railway with Mburu acting as their logistics services provider.
Sources told Kenyan News Day Mburu’s role as middleman was to evade tax as clearing and forwarding agent for CRBC and also repay his good friend Abubakar Joho, Chairman of Autoport Freight Terminals Ltd, through provision of Container Freight Stations services (CFSs), again for a period of 30 years as subcontractor to CRBC.
Through Mburu, CS Macharia would likely receive his multi-million kickbacks channeled through a network of associates managed by his Zambian wife Pamela Chanda.
Kenya News Day learnt that Joho had used his judiciary connections to facilitate the release of Mburu on bond, going further to pull strings at the DPP Noordin Haji’s office so that prosecutors could go slow on Mburu on his tax evasion case which cost the country over Sh64.9 million in lost revenue.
With Mburu now free to resume his tax evasion activities, CS Macharia found a trusted associate he could use to receive kickbacks from the notoriously corrupt Nairobi-JKIA expressway project concessionaire CRBC.
Mburu’s firm Landmark Logistics which had been blacklisted over importation of tainted sugar in 2018 is well known shell company DP Ruto uses to import duty-free sugar.
So serious is the matter that the National Intelligence Service has in a confidential report raised serious reservations about the likelihood of tax evasion and smuggling by this cowboy contractor using the road contract as cover.
According to papers in our possession, Mburu was incidentally the logistics services subcontractor for Zakhem International which won the contract for building the new 450-kilometre Mombasa Nairobi pipeline.
Zakhem reportedly won the tender to replace the 43-year-old pipeline under a cloud of controversy and amid allegations that it had been backlisted in several countries. Eventually, Zakhem did not satisfactorily complete the job, and it failed to pay taxes even as it unreasonably increased contract cost from Sh48 billion to Sh62 billion.
In the end Investigations by Kenya Revenue Authority established that at least Sh18 billion were never paid in import duties and VAT by Landmark Logistics which handled most of the imports for the pipeline contract.
In the previous investigations on Mburu and Landmark Logiscrics, DCI forensic sleuths unearthed a money trail that showed DP Ruto’s multi-million church donations, political campaigns and helicopter charters were essential paid from accounts controlled by Mburu who is in an on/off intimate relationship with Nakuru Senator Susan Kihika.
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