Investigations

KBC – PWC Conspiracy: Ruto’s 2022 Plan

KBC Head Office in Nairobi.

Fresh from its disgraceful failure to obtain rights to the Gold Coast 2018 Commonwealth Games (Australia) and the ongoing Russia 2018 World Cup, the management at the Kenya Broadcasting Corporation, appears set to reward Company Secretary and acting MD Paul Jilani by manipulating the recruitment process for the broadcaster’s Managing Director post advertised in May.  

Information leaked to the Weekly Citizen, reveals a scheme to undercut all top candidates in the current recruitment of a new MD. The post was left vacant when Waithaka Waihenya left the media house in October 2017 and was replaced by company secretary Paul Jilani in an acting capacity.

The management consulting recruitment process was awarded to scandal prone audit firm PricewaterhouseCooper. PWC as they are known, have in the last two years received bans in Japan, India, New Yorkfor manipulating information in collusion with various managers of firms they are contracted to audit.

According to the whistleblower who works at PWC, the process of recruitment for a new KBC Managing Director stopped being objective after the KBC Board led by Kennedy Imbwaya forced a 3 day extension to the Friday 25th May 2018 deadline earlier advertised.

“Once the deadline was extended to May 27th which is a Sunday, the backhand games began. It provided the window to isolate the strong candidates for undercutting and also open the back door for the board’s favourite candidate –Jilani. Inside PWC it is so obvious that this guy did not even rank within the top 5 candidates with regard to the experience and capacity we were looking for

The shock announcement on 8th June that dismissed Sammy Itemere, as Principal Secretary Broadcasting & Telecommunications among 15 others, left the process without a clear hand to enforce the rules.

ICT Cabinet Secretary Joseph Mucheru

The KBC Board and MD appear to have seen the vacuum as an open chance to manipulate the process and issue “shortlisted” names directly to the ICT Cabinet Secretary Joseph Mucheru, without the due diligence scrutiny that would have been provided by the Broadcast PS. The process entails the board shortlisting, interviewing and presenting 3 names to the Broadcast PS who after scrutiny of process would present them to the Cabinet Secretary to make the final appointment.

Those in the know confide the current shenanigans are not really about Jilani but focused on having a person friendly to the Ruto 2022 Campaign. According to our source, Ruto’s camp is shopping for media outfits to enhance its 2022 campaign communications. Having elevated key allyFarida Karoney into the cabinet as Lands CS, the campaign team is concerned on their diminished influence at Royal Media Services where Karoney as COO gave the DP unfettered access to prime time TV.

Alongside the change of guard at Royal Media, the team has little influence at the Standard Group (owned by a hostile Moi Family) and the Nation Media Group (Controlled by pro Uhuru businessmen and partially the Kenyatta Family who recently bought a stake). While the DP bought 10% Mediamax which owns K24 TV, Kameme and the People newspaper, its influence and market share does not give him the controlling media presence he requires towards his 2022 Presidential bid.

As such, government funded KBC becomes a critical instrument to reach the grassroots and soften the 2022 battlegrounds. 

Ruto was recently reported to have also expanded his media empire by acquiring Xtra Publishing Ltd that will see the revival of XNews as a 42-page national free sheet newspaper. A TV station is also planned.

However, it is the ease with which the KBC scheme was executed that shows evidence of how seriously Ruto’s camp is exploiting gaps within the Jubilee administrationfor strengthen his bid.

According to the insider, with PS Itemere slated to leave on June 30, pressure was put on PWC to massage the shortlisting and make Jilani the front runner.

“We had to eliminate the strong candidates and put weak ones alongside their chosen candidate. The KBC Board and the MD promised our firm 3 years worth of auditing business in return for the manipulation”

According to a HR source inside KBC, a plan was hatched to conduct hurried interviews within days of producing the manipulated shortlist. The interviews of Jilani and the competing weak finalists were done without informing other applicants of their unsuccessful bids.

“The plan is to have Jilani appointed MD before the President appoints a new Broadcasting & Telecommunications Principal Secretary to replace Itemere. They know this guy can’t be picked ahead of the other candidates

DP William Ruto.

Moving the KBC Board to stealthily deploy a compliant MD is testimony of how well placed the DP’s allies are. Most people have little knowledge that Ms Farida Karoney who was recently appointed Lands CS still retains her seat on the KBC Board of Directors, having been appointed for a 3 year term in 2015 while still a manager at Royal Media.

It is possible the scheme may succeed as industry insiders allege CS Joe Mucheru practices a hands-off approach when it comes to the broadcasting side of his ministry and may not be familiar with the widespread financial and ethical mismanagement of what was once a shining institution.

A former senior manager at KBC now with rival Royal Media Services is convinced KBC is headed for potential collapse.

“The place lacks vision and no one is responsible for anything. No one gets fired for anything. At the helm of KBC is nothing but pure incompetence. KBC is on auto pilot and on its knees. Other than keeping their jobs, the current management appears to have given up any effort for meaningful change. It is almost impossible to figure out what KBC as an institution was actually founded to do”

By allowing Jilani and the KBC Board to “karate kid sweep from under all the professionals willing to serve and offer value to KBC, PWC appears determined to emulate its other world branches who trade off professional ethics and sometimes engage in fraudulent behavior to obtain contracts from private and public institutions.

PWC building located along the Waiyaki way.

In January this year, PwC’s Indian unit was banned from auditing listed companies for two years, over one of the country’s biggest corporate scandals. Price Waterhouse was auditor for Satyam computers when company owner Ramalinga Raju admitted to inflating earnings in a $1.7bn (KShs 170 billion) fraud. The collapse of Satyam Computers in 2009 cost shareholders more than $2bn and rocked India’s IT industry.

In 2015, Kenyan accountants’ professional watchdog ICPAK investigated PWC Kenya as an accomplice to a Ksh 879.1 million accounting fraud at Chris Kirubi’s Haco Tiger Brands. Investigators questioned how PWC could have failed to detect the huge and illegal financial adjustments. PwC was Haco’s external auditor.

In 2017, PwC was cited in an (IRBA) investigation for its failure to disclose SA Airways (SAA) procurement failures while auditing its accounts . Still in South Africa, PwC had to pay KShs 1.5 billion to shareholders of looted Randgold & Exploration, a mining company for not disclosing auditing discrepancies that led to the collapse of the company.

A few years ago, PWC was fined $25m (KShs 2.5 billion) and banned from some consulting work for two years by New York State’s financial regulator because of misconduct during work at Bank of Tokyo-Mitsubishi.According to authorities, PWC secretly softened details of an oversight report about the bank it was assigned to monitor.

“When bank executives pressure a consultant (PWC) to whitewash a supposedly ‘objective’ report to regulators — and the consultant goes along with it — that can strike at the very heart of our system of prudential oversight,” Director Financial Services Superintendent Ben Lawsky said in a statement.

Hopefully EACC and ICT CS Joe Mucheru will intervene and nip this unfolding corporate schemes fraud that will sound a death knell to the little professionalism that remains at KBC, an institution that has birthed thousands of iconic broadcast figures.

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