Kenya’s Ethics and Anti-Corruption Commission (EACC) arrested four individuals on Thursday, including the former Cabinet Secretary and Permanent Secretary for Tourism, Najib Balala and Leah Gwiyo, for alleged procurement fraud in the construction of a hospitality college in the southern region of Coast. The four are facing corruption and economic crime charges, including ten counts tied to the irregular disbursement of KES 8.5 billion from the Tourism Fund for the Coastal region’s Ronald Ngala Utalii College.

EACC Spokesperson, Eric Ngumbi, commented:

Investigations were undertaken by the commission regarding the payment of Sh8.5 billion by the Tourism Fund out of which Sh4 billion was paid to a company for consultancy services for the proposed Ronald Ngala Utalii College … Upon conclusion of the investigations, EACC submitted the investigation report to the DPP, and the DPP concurred with the recommendations to apprehend and charge 16 persons.

EACC investigations revealed a 2007 memo by Balala that inflated the college’s construction costs from KES 1.95 billion to KES 10.4 billion. Balala and Gwiyo also face abuse of office charges for engaging consultants against a cabinet decision, resulting in the irregular payment of KES. 3.3 billion in consultancy fees on December 13, 2010. Joseph Odero, the third suspect, faces charges of fraudulently obtaining KES 292.4 million for consulting services.

The three suspects pleaded not guilty before the Chief Magistrate Court in Malindi on Friday. The court has released Balala and Gwiyo on KES 5 million bond each or KES 1 million cash bail each. Joseph Odero has also been released on KES 3 million bond or KES 800,000 cash bail.

The EACC informed local media that 12 more suspects, including officials from the Tourism Ministry and Tourism Fund, await arrest. They will face charges of willful failure to comply with procurement laws, abuse of office, and unlawful acquisition of public property. The case is scheduled for mention on December 28, 2023.