A month before his term expires, Kenya National Chamber of Commerce and Industry (KNCCI) boss Richard Ngatia faces an uphill battle to keep his job given that businessman David Langat, founder of the DL Group of Companies, is likely to try to unseat him with the backing of President William Ruto. Langat is thought to be preferred to the chamber’s current number two, Eric Rutto.
David Lang’at is among prominent entrepreneurs and corporate executives appointed to the National Investment Council by President William Ruto, with others including alcohol tycoon Humphrey Kariuki and Head of M-Pesa Sitoyo Lopokoiyit.
Lang’at is among businessmen who backed President Ruto’s State House bid in the 2022 polls. He has, however, mostly managed to keep a low profile for much of the over three decades he has spent rising in the world of business.
He made his fortune in the import and export business, before expanding into agribusiness, real estate, energy, hospitality, insurance and, more recently, special economic zones (SEZs). According to his firm, DL Group, importing and exporting goods including electronics and furniture was among the earliest activities engaged in after establishing the business in the eighties.
Some of Lang’at’s ventures include DL Teas, DL Farms, Selenkei Investments and Cedate (energy), Nyali Mall, Sunrise Resort and Spa, Niconat Insurance and Africa Economic Zones Ltd. DL Teas owns farms in Kericho and Nandi and according to DL Group has a production capacity of about 11,000 tonnes per year, DL Farms comprises 1,000 acres under crop and 500 acres for livestock, and Selenkei and Cedate are managing development of solar PV projects to be located on 600 acres of land near Eldoret town, with an ongoing 94 MW Project having an investment of $170 Million (Ksh20.8 billion).
More ventures in Lang’at’s portfolio include furniture dealer DL Furniture, fire fighting equipment provider Firefox and a partnership with Israel’s Magical Security Systems to provide provide design, installation and maintenance of integrated security systems in East Africa.
Mr. Scandals
At KNCCI, Ngatia is loathed by a section of management who feel like he runs the organization as if it’s his own household. This has seen Ngatia battle numerous court battles with disgruntled colleagues in the hierarchy who feel squeezed by his mismanagement.
In 2019, Nairobi Chambers directors took Ngatia to court for meddling in the affairs of the organization that saw him force Geoffrey Kimani an accomplice into office just in time for a MasterCard project that blew up.
At the time, it was reported that Equity Bank had gotten into a partnership with KNCCI and set aside Sh200 billion for the chambers to access as part of the COVID-19 financial support for businesses. However, it turned out this was just a bluff and didn’t move beyond the cameras. It didn’t take off as Equity Bank being a partner with MasterCard had gotten wind of the misuse of funds by the chambers and took a long step back. There was nothing to show that this loan hit the accounts.
In the MasterCard case, it’s said while the beneficiaries were to strictly be members of the chamber and from Nairobi county, preliminary results showed some beneficiaries were outside the county. Only a forensic audit would reveal the extent of the alleged crime.
MasterCard at the time, wrote a protest letter to the body demanding for a refund of their money earlier given and was misused, KNCCI instead on their website, uploaded a planted story claiming to have received again money from MasterCard but this was a damage control, nothing had happened at that time.
Ngatia who was an aspirant for Nairobi Governorship on the former President Kenyatta’s Jubilee Party ahead of the August 9, 2022 General Election is also battling other corruption allegations mostly from the health sector where he’s regarded as one of the ‘healthcare mafias’ or ‘Covid-Millionaires’.
The business magnate is said to have used the proceeds of the COVID-19 scandal to fund Azimio presidential candidate Raila Odinga. During the elections, Ngatia had a pivotal role in Raila’s contest against President William Ruto.
Recently, an activist moved to court to have the businessman probed over the “irregular” procurement of Sh10.2 billion Computed Tomography Scanners (CT Scanners).
The lobby group called for forensic investigations into the tender for the supply of the machines, controversially awarded by the Ministry of Health in 2017 to Megascope Healthcare (K) Limited, a firm linked to Mr Ngatia.
Mr Frank Awino of the Human Rights Crusaders under the Concerned Citizens Kenya- a civil society organisation, says that the procurement of the 37 SCT Scanners was a gross violation of Article 227 of the Constitution and the Public Procurement and Asset Disposal Act that should not be allowed to “just slip away.”
Mr Awino has since petitioned Health Cabinet Secretary Susan Nakhumicha to call in the Ethics and Anti-Corruption Commission (EACC) and the Directorate of Criminal Investigations (DCI) to investigate the “irregular” procurement and that those found culpable be prosecuted.
There is overwhelming evidence of grievous irregularities and circumventing of the law in the procurement of the CT Scanners,” Mr Awino says in the petition.
Article 227 (1) of the Constitution provides that when a state organ or any other public entity contracts for goods or services, it shall do so in accordance with a system that is fair, equitable, transparent, competitive and cost-effective.
“The procurement law states the procedures for efficient public procurement must be devoid of skewed processes.
Mr Awino notes that there was no reason to have the CT scan machines not included in the Managed Equipment Services (MES) leasing scheme.
He is also questioning why the Ministry of Health went ahead to procure the same independently besides the “blatant” violation of the procurement laws.
Hoodwinked
The petitioner avers that the Ministry of Health and the general public may have been hoodwinked that the procurement of the machines was a Government-to-Government arrangement between the Kenyan government and that of China.
The contract signed on August 21, 2017, provides that the Kenyan government pays 20 percent of the contract sum of Sh1.7 billion with the Chinese government through China Development Bank financing the balance of Sh8.5 billion in loans to be paid by the Kenyan government.
The supplier was required to supply, install and maintain the scanners in hospitals identified by the ministry of Health for five years.
Although one machine was to cost Sh75 million, documents presented to parliament revealed that the price was varied to Sh235 million, slightly more than three times the cost of a machine, in what signaled blatant misuse of public funds.
This emerged even as the National Treasury previously said that the entire amount included cost of scanners, accessories, training of staff- radiographers and related infrastructure, a clarification that did not sit well with the MPs.
Although the Chinese government had recommended to the Kenyan government an international CT scan manufacturing company- Neusoft Medical Systems Company limited to supply the machines, the contract was “strangely” awarded to Megascope Healthcare (K) limited.
“There was no competitive bidding for the tender as it was executed through a restricted process and the beneficiaries could themselves or through their agents have induced the heist,” says Mr Awino adding; “curiously, there were no procurement documents availed for audit review as required by the law.”
The choice to whether Ngatia will retain his seat or relinquish sits with the president.
