April 19, 2002
A senior World Bank employee supervising a major project in Kenya has pleaded guilty to charges of corruption. He admitted to entertaining a request for a kickback from a Kenyan government official involved in the project.
The bank's own investigations have also shown that a company which had been given two contracts under the roads project, paid bribes to one of its employees and a Kenyan official.
This puts the Kenya Urban Transport Infrastructure Project, whose funds the bank cut off last October, in more trouble.
The man on the spot is a former senior World Bank official, Mr Gautam Sengupta, who was based in Washington where he served as the task manager for the Kenya Urban Transport Infrastructure Project.
A statement from the bank yesterday revealed that Sengupta recently admitted in a US Federal Court that he received a request from "a foreign government official in the Kenyan Project Implementation Unit for a US$50,000 payment".
The statement added that Mr Sengupta also admitted that he agreed to pass on the request. He also said he did so with the knowledge that the payment was to corruptly influence the Kenyan official. Mr Sengupta is yet to be sentenced by the court.
The government is understood to be under pressure to carry out investigations into the official or officials involved in the corrupt deals.
Allegations of corruption have marred the project since March last year when the World Bank opened an investigation into it.
According to the statement, it is after the investigation unearthed evidence of corruption that it referred the matter to the US Department of Justice.
The investigations uncovered proof that a consulting firm, which had been awarded two World-Bank financed contracts under Kutip, had made payments to a former World Bank official.
The statement said the bank reported the results of the investigations to the Kenya government in October last year and consequently suspended all further disbursements for Kutip.
Yesterday, the bank clarified that contrary to reports in the media, the current task manager for the project, Mr Lance Morrel, was not involved in the matter.
Last year, the government was forced to call in the Anti-Corruption Police Unit to investigate allegations of corruption in the project.
Kutip was initiated in June 1996, with the aim of improving the road network in 26 towns and the capacity of the local authorities to maintain them. Some $ 79.86 million (sh6.2 billion) of the loan has been spent so far, with some $21.67 (Sh1.69 billion) remaining unspent. The government was supposed to spend $ 40 million (Sh3.2 billion) as counterpart funds.
Some of the key pending works which were supposed to have been done under Kutip include the dualling of Nairobi's Ngong Road, the building of pavements and pedestrian lanes in Eastleigh and construction of a new road linking Likoni and Mombasa Road in Nairobi.
Following the suspension of disbursements, these projects have not gone beyond the design stage. Similar projects in Nyeri, Meru, Embu and Murang'a have also stalled.
Yesterday's statement did not say when the bank is likely to resume disbursements for the project, merely pointing out that the government had already been given the conditions under which the suspension may be lifted.
It was revealed that the government is conducting its own investigations into the affair after the world bank passed on investigations regarding a Kenyan involved in graft.
Mr Sengupta declined to give further evidence on the Kenyan involved in the scandal, saying it would jeopardise investigations.
"When the Bank developed sufficient evidence to believe that there was wrongdoing on part of a Kenyan official, it referred that matter to the Kenyan Government in October 2001," he said.
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