Corrupt LAPFUND CEO David Koross
A whistleblower has called for a probe into how Local Authorities Provident Fund (LAPFUND) CEO David Koross reportedly bribed the board with millions of shillings to secure a third term in office.
Following Kenya Kwanza’s emphatic win during the August 2022 polls, Koross was eyeing a Cabinet Secretary (CS) or Principal Secretary (PS) appointment but he missed out on both.
This prompted him to arm-twisting the board into handing him another five-year term.
LAPFUND manages pension funds for employees of County Governments and other bodies like Water Companies.
In an appeal to the Ethics and Anti-corruption Commission (EACC) and the Directorate of Criminal Investigations (DCI) the whistleblower discloses that in the past three years, Koross has mismanaged the fund through corruption and pocketed an estimated S800 million in kickbacks and plain theft.
Staff morale is at an all-time low and some have been quoted pleading with the president not to allow Koross to have another term.
“In a business deal in Makasembo in Kisumu Koross solely looked for a contractor and awarded them a contract worth 7 billion,” a source said.
They also accuse Koross of employing relatives of officers in state agencies that are supposed to investigate him.
This serves as a bribe to make them look the other way.
“He has stayed more than 10 years, which is illegal and against the RBA act. He now wants another five years and that’s not legal,” another source lamented.
Adding: “Koross brags that his brother Musa Sirma is an MP so nobody can touch him. Employees want a forensic audit because he always finds a way to corrupt the government audit. We demand that government reconstitute the board afresh, send home all the managers and appoint a caretaker committee.”
LAPFUND staff further claim that Koross is working in cahoots with the Head of Finance Mr Mbogo, the Head of Procurement Mr Kibet and the Tender Committee Chaired by Akolo, the blue-eyed sweetheart of the CEO.
They fault the unholy trinity for the massive plunder of the corporation’s resources.
Below is a list of areas that employees have urged investigators to explore.
(I) Mavoko Gardens
The development of Mavoko Gardens Estate in Syokimau. The construction was estimated to cost 700 million but to date so far over Sh1.2 billion shillings has sunk in the project.
The CEO has reportedly pocketed not less than Sh60 million in kickbacks.
(II) Golf View Apartments
The development and renovation of Golf View Apartments has cost the fund over 1.5 billion. The building is currently closed for a makeover at an estimated cost of Sh133 million shillings.
The same contractor was involved in both Mavoko Gardens and Golf View Apartments.
(III) Disputed purchase of property
The CEO and his cronies have engaged in the purchase of properties at exaggerated prices and others with fake titles. They allegedly bought 30 acres in Kitengela at an exorbitant price of Sh10 million per acre from a broker, while the market price at the time was Sh5 million per acre.
The land is disputed by the owners, and they have taken LAPFUND to court.
They purchased the land in Bellevue South C at Sh500 million per acre. A suspicious payment of an extra over 300 million was paid in early 2019 one year after the transfer was done.
(IV) Questionable trips
The CEO is accused of sending select members of staff for suspicious international training, seminars and trips that are not beneficial to the organization.
It is rumoured that some of them are in an intimate relationship with the boss.
(V) Irregular procurement
There are reports that the procurement of architectural property development consultants amounting to over Sh150 million was done through restricted tender against the PPAD Act regulations in June/July 2019.
LAPFUND is not a security body and thus should float tenders publicly.
Sources say that many other tenders amounting to millions of shillings are procured through quotation; for instance, the valuation of properties at Sh32 million was done in July/August 2019.
Others include:
- Illegal recruitment of staff without approval by the National Treasury or the board
- Funds amounting to over Sh11 million stolen from Golf View apartments has been written off as bad debts
- A property agent selling Mavoko Gardens retaining Sh8 million received on behalf of LAPFUND for over two years
- Improper reconciling of funds and non-issuance of statements due to plunder of the resources
“We request for a forensic audit of the fund by RBA to establish the rot and misuse of pensioners’ funds,” one staff member pleads.
They claim that the CEO survives on bribing and compromising anybody who tries to raise a finger.
“If the trend continues, it will deplete the fund of pensioners’ benefits. Politicians and other cartels collect money at will from the fund. He has protection from political players and other business cartels,” he warned.
Adding: “We request EACC and DCI to move with speed to investigate, arrest the culprits and secure the files before they tamper with the records.”
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