TRANSCENTURY GROUP INVADES YOUTH FUND, FIRES CEO! Jun 24, 2009 23:31:59 GMT 3
Post by job on Jun 24, 2009 23:31:59 GMT 3
The Standard newspaper is reporting today that an audit reveals corruption has been entrenched in the Youth Fund, citing numerous cases of lost hundreds and tens of millions.
But they are totally missing the bigger point. More is being lost than they report, to well known Kibaki cronies.
The real headline should be:
TRANSCENTURY GROUP INVADES YOUTH FUND, KICKS OUT CEO .
WHY WAS YOUTH ENTERPRISE DEVELOPMENT FUND CEO, UMURU WARIO ALONGSIDE THREE TOP MANAGERS, RECENTLY SACKED?
Everyone by now knows Kibaki’s plutocracy called the TransCentury Group which has irregularly (by just a few pieces of silver) grabbed most Kenyan public corporations and even coerced their way into ownership of well performing private entities.
It is a ruthless, greedy club of about a dozen Kingpins of primitive accumulation.
This wealthy group controls and influences the Kibaki government without doubt, and anyone pondering over who the architects of the 2007 election stealing were, doesn’t need to go any further.
The Group has immensely benefitted under the Kibaki era which has seen them irregularly acquire the East African Cables (EAC), KPLC (the shares formerly owned by NSSF), Development Bank of Kenya, Housing Finance Ltd, and Kenya Railways.
It also grabbed an additional government shares offloaded at Safaricom and Telkom under nefarious foreign sounding covers.
It is also still angling to loot majority of the shares the government intends to offload from KenGen, Mumias Sugar, Kenya Consolidated Bank, Kenya College of Communications and Technology and Kenya Reinsurance Company. Their fingerprints are all over recent dubious investment partnerships at the JKIA Airport, and in the energy sector.
They also enjoy unfettered access to state contracts through a network of conflict of interest appointments of its own members and cronies in most state corporations, best exhibited by TransCentury member and KenGen CEO Eddy Njoroge. TransCentury owns power cable manufacturer EAC which supplies (near monopoly) both KPLC & KenGen.
What is astounding is the greed exhibited by these TransCentury sharks.
Despite all the leverage they enjoy in getting single-sourced state contracts and acquiring public assets for a song, with cumulative stocks so far surpassing Shs. 120 billion, their mouths are still watering over a relatively small fund set up to boost Youth Enterprise in the country.
Youth Enterprise Development Fund (YEDF)
Majority of Kenya’s 13 million youth aged between 18 and 35 are unemployed, landless and lacking economic opportunities to earn a living.
We witness daily the illegal and criminal activities of Mungiki youth in the Mt. Kenya region.
So when a noble fund is initiated to provide loan opportunities for the youth, Kenyans should be breathing a sigh of relief at the possibility of reduced societal pressures brought about by youth unemployment.
But the glutonous sharks at TransCentury won't let that happen!
The YEDF was set up two years ago by the government, through the Ministry of Youth and Sports, with a down payment of Shs 1 billion, to finance youth based ventures.
So far, it is reported to have loaned out (interest @ 8% p.a.) about 65,000 investment projects (group and individual) across all provinces of Kenya.
The model of financing involves leverage matching, whereby the government partners with private or other institutions and banks, and for every government shilling loaned out to a youth (or group), the financing partner puts a multiple match, for instance, at KCB, for every Shs 10,000 the government loans, KCB tops up 90,000 to make the loan Shs 100,000.
Besides KCB, other partners to this Youth Fund include Equity Bank, which is 38% owned by the TransCentury Group, Family bank and others.
As you see, Transcentury is therefore startegically placed as a major financing partner in the profitable business.
But interest profits on loans is not the only thing TransCentury has been eyeing in the Youth Fund (YEDF).
TransCentury has been using its political connections to FORCE another lucrative consultancy partnership with the YEDF to “train”, “mentor”, “coach”, and “network” these upcoming young entrepreneurs.
Every Tom, Dick and Harry knows such language is used to veil the clearly anticipated THEFT of funds for poor youth. Certain folks simply use political connections to access the funds, thereby reducing available resources for lending to the poor youth
TransCentury is joined by many other PNU government connected bureaucrats running all sorts of ‘consultancies’ and ‘NGOs’ purporting to seek funds for this so called ‘youth enterprise support’. In the process, they gobble up the little resource supposed to be loaned out to the youth.
The TransCentury greed doesn’t end there. They have also partnered with a foreign NGO in Canada called Enablis Entreprenuerial Network, and joined the fray again, packaged in new clothing, purporting to offer matching funds for loans from the Fund.
Enablis doesn't even need competitive bidding for financing, it is enjoying single-sourcing priviledges relayed through the Youth PS Murugu who also sits in the YEDF board.
This is a classic case of how state-sponsored credit subsidy programmes remain open to manipulation by well-connected power brokers and lobbyists.
Instead of poor youth investors being the biggest beneficiaries of subsidized loans, rich powerful players are the ones now cleverly capitalizing to cash billions.
The deal with Enablis is so shady and full of conflicts of interest that under the agreement with YEDF, the money would be given to a new fund, the Enablis Loan Fund, to be run by a board of trustees whose chair will be James Gachui, Chairman of the Transcentury Group Ltd.
Then this Enablis Loan Fund is to be managed by yet another entity- the Enablis Financial Corporation- for a fee. This Corporation is also a TransCentury owned entity.
This is the slice-and-dice, duplicitous, costly arrangement that former Youth Enterprise Development Fund CEO Mr. Wario was rejecting.
So far, the largest recipients of YEDF funds have been Equity Bank (which TransCentury owns a big chunk of), Kenya Commercial Bank, Family Finance Bank and the First Community Bank of Kenya, which offers Islamic banking. Other recipients include K-Rep Bank, Kenya Women Finance Trust and the Kenya Industrial Estates.
Now here comes TransCentury again hiding behind a veil. TransCentury is now coming clothed under this Canadian NGO called Enablis Entreprenueral Network , in a deal first brokered through former State House operative and well-connected power broker and political lobbyist, the late Alex Mureithi, a nephew of President Kibaki.
This Kibaki fella is so stone-faced and hard-eyed. This vulture-like NGO (read TransCentury partner) that PNU is bringing to attack the Youth Fund is so pampered that at its launch in Nairobi in 2007, Kibaki sent his former Minister for Youth, Mohammed Kuti.
Yaani Kibaki is launching a subsidized Youth Fund, commiting government billions into it, then scheming his Transcentury sharks to loot from it. No wonder this fella thinks all Kenyans are Pumbavus.
The YEDF CEO, Mr. Wario, was not willing to play Pumbavu. He deliberately challenged the PNU appointed YEDF Board that the matching being offered by this TransCentury-cum-Canadian-NGO was not as beneficial to the youth program as those offered by other Banks.
In fact Wario realized this was an outright scam where the real beneficiaries would be TransCentury and the Canadian NGO, and NOT YEDF, nor the Kenyan youth.
TransCentury quickly figured the best way to handle this problem was to fire Wario and impose a TransCentury puppet as CEO of the Youth Fund.
Remember that the YEDF Board comprises ALL TransCentury/PNU puppets namely;
MICHAEL KIRUTI – who is also a TransCentury Group lawyer, and Board member of the same Canadian company seeking YEDF funds (Enablis).
KINUTHIA MURUGU – PS Youth Affairs & Sports, a TransCentury imposed bureaucrat.
SAMUEL MACHARIA – another TransCentury lobbyist who doubles up as board member at Canadian company Enablis.
TURE BORU – PNU carpetbagger imposed by former PNU Youth Minister Kuti to ‘yes’ all TransCentury interests.
HELLEN TOMBO – puppet Chair of Board imposed by PNU to angle for TransCentury interests
RINA KARINA – another twenty something youth imposed by PNU into the board by the PS Murugu to prop TransCentury interests.
ABSHIRO HALAKE – another PNU patronage beneficiary imposed by Kuti to endorse TransCentury matters.
DAN AWENDO – another PNU patronage beneficiary planted by Raphael Tuju to angle for marketing and promotion contracts for Tuju’s firm besides supporting TransCentury interests.
SIMON SIMIYU – another PNU patronage beneficiary planted by Musikari Kombo to angle for supplies deals while saying ‘yes’ to TransCentury interests.
People need to open their eyes and see this noble youth fund (YEDF) being invaded by TransCentury thugs.
How can a Kenyan public Youth Enterprise Development Fund have its board granting a Sh300 million loan to a Canadian NGO called Enablis rather than local financial institutions spread across the entire country. People, people, people!
Why not give it to KCB who will match it with Shs 3 billion in funds ready to be loaned out to the Youth? This is the same question Wario has been putting down to the YEDF board and they can’t answer. Then sample this.
If the Canadian NGO (& TransCentury) are given Shs 300 million, they will only loan out Shs 600 million to the youth (matching ratio 1:1). If the same Shs 300 million is given to KCB, they would leverage financing and loan out Shs 3 billion (matching ratio 1:10). Even a fool knows which option to choose.
This is the reason Umuru Wario is being fired my friends. TransCentury greed to loot Youth funds!
TransCentury has decided it will forcefully use its political connections and power to get the loan for Enablis go through.
The loan to Enablis will be the largest to be released to a single institution since the Youth Fund was established two years ago.
In Kibaki’s Kenya, you get fired if you try to do the right thing.
If you happen to be called Wario and is the CEO of YEDF, and you make the prudent decision that the opportunity cost of giving a massive loan to a Canadian-cum-TransCentury NGO called Enablis is just too high, you simply get fired.
If you decide that there is a comparative advantage of YEDF dealing with local institutions because they have wide national branch networks accessible to Kenyan youth, then you get fired.
Mr Wario also expressed fears that, considering that Enablis will just be extending loans to members of its own network – mainly urban-based entrepreneurs who have to pay a membership fee of Sh5,000 before joining – the money may not reach the Youth Fund’s target group. He is being victimized for this level-headed pragmatism. He is being fired because he did not respect TransCentury who is the real face behind Enablis.
This story is reported in detail by Jaindi Kisero in an investigative story published in the Daily Nation, April 25th, 2009 edition.
some excerpts from the report:
The genesis of the deal is traced to a July 28, 2006 letter from the chair and CEO of Enablis and well-known Canadian entrepreneur, Charles Sirois, to President Kibaki. In the letter, Mr Sirois pledged to create an Enablis Loan Fund in Kenya to support entrepreneurship in the country.
“If Kenya establishes a fund of $10 million, a matching $10 million will be introduced through Enablis,” the letter said, adding a provison that the promises would be subject to a feasibility study by the provider of the funds — the Canadian International Development Agency (CIDA)
End of excerpts
This is a big lesson about populist initiatives set up by well known greedy sharks. They don’t set them for the masses, but purely for their own minting.
I am now more interested in seeing what PARLIAMENT, ODM Minister for Youth, the Prime Minister, Inspectorate of Corporations, and other non-PNU, non-Transcentury leaning, members of government, alongside KACC and other institutions do about this tragic comedy.