A parliamentary committee is on the spot for allegedly shielding a bank accused of tax evasion and money laundering involving billions of shillings.
In a report titled: “Smouldering Evidence: The Charterhouse Bank Scandal,” the Africa Centre for Open Governance accused the Committee on Trade and Finance of pushing for the bank’s reopening instead of investigating allegations against it.
Cleared the bank
“The conclusion could be made that the committee was not interested in the truth but was merely going through the motions to validate a pre-meditated decision,” the governance watchdog notes in the report published last week.
“It seemed odd that the Parliamentary Committee seemed to be lobbying for the re-opening of the bank in spite of continuing investigations,” it said.
It accused the Committee chaired by Nambale MP Chris Okemo of colluding with the Treasury, the Attorney General’s office, Kenya Revenue Authority (KRA) and the Kenya Anti-Corruption Commission (KACC) to cover up the scam.
The committee cleared the bank last year and recommended its re-opening. (READ: House team clears Charterhouse Bank)
Nominated MP Musikari Kombo on Wednesday said the committee was protecting Kenyans from compensating the bank.
“We realised the bank wanted to use the committee to push for compensation. To protect Kenyans, we recommended that the bank be re-opened so that taxpayers’ money was not used to pay compensation,” he said.
The MP, who sits on the committee, said it relied on evidence by Finance Minister Uhuru Kenyatta, Attorney-General Amos Wako, KRA commissioner-general Michael Waweru and KACC’s John Mutonyi.
“If you were in the committee, I don’t know how you would have alleged tax evasion when KRA says there is none. CBK said they had no problems with Charterhouse.
“Wako said he had no problem with Charterhouse. Treasury said it had no problem with Charterhouse so we said, go ahead and re-open it,” he said.
Charterhouse Bank refused to comment on the report and threatened to sue this newspaper if it published the story.
“There is nothing new in the report. We will sue anybody who publishes the story,” said a top official at a public relations firm, which acts for the bank.
In the report, the watchdog criticised the committee for not investigating queries by audit firm PriceWaterhouseCoopers.
“The committee held surprisingly little discussion on Charterhouse even though there existed evidence from a credible audit firm of extensive malpractice,” it says.
“Relying on the accounts of officials who had manifestly contradicted themselves was unsafe,” the report noted.
The watchdog censured the committee for entertaining a petition by customers demanding its re-opening.
“How were the 35 customers able to organise to petition the National Assembly?” the report asks and calls for a scrutiny of the petitioners.
