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Water Sector Trust Fund CEO Shaiye In Office Illegally Amid Claims of Financial Impropriety

admin February 16, 2022

(From left to right) Mr. John Kauzya (Chief of Public Services Innovation Branch), Ms. Alia El-Yassir (Regional Director for Europe and Central Asia, UN-Women), Mr. Simon Chelugui (Cabinet Secretary, Ministry of Water and Sanitation) , Mr. Patrick Kokonya, (Chairman, WaterFund), Mr. Ismail Shaiye (Chief Executive Officer, WaterFund) and Ms. Stella Warue (Programme Officer, WaterFund)

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It is now emerging that the Water Sector Trust Fund (WSTF) CEO Ishmail Shaiye continues to occupy the office illegally long after his tenure expired.

At the same time, the CEO is facing barrage of accusations of graft, impunity, integrity issues and abuse of office, which has seen WSTF lose millions of shillings in shadowy dealings.

Late last year, the matter was brought to the attention of the then Cabinet Secretary in charge of water, sanitation and irrigation Ms Cecil Kariuki for immediate action. Ms Kariuki has since resigned to go for elective position in the forthcoming general elections.

In a letter to CS Kariuki dated December 20, 2021 a copy of which is in our possession from an anonymous source, the letter reads in part: “The CEO’s (Shaiye) final term in office upon extension expired on November 10, 2021. The CEO is therefore flagrantly violating the law and instructions given by the Head of the Public Service. He is in office illegally and this is very much in the public domain. He does not have a valid contract with WSTF and should be out.”

The letter was copied to the Head of the Public Service and the Secretary/CEO State Corporations Advisory Committee.

Water Sector Trust Fund (WaterFund) | LinkedIn

It documents that the worst-hit area is the hundreds of millions of shillings entrusted to the Fund by the European Union for water and related development projects in the country, but Mr Shaiye and his top managerial cohorts were colluding with some water companies to loot the fund.

According to insiders, the highly questionable projects and general expenditures which has sucked in the Fund’s CEO include Tavevo Water Company in which Mr Shaiye was heavily involved in fraudulent transactions in which hundreds of millions of shillings was lost as at the end of last year.

“Several millions of shillings from the European Union have been lost following instructions attributed to the CEO. This issue should be investigated further and we demand a forensic audit be undertaken including transactions in the company’s bank accounts because this is just a tip of the iceberg,” the letter reads.

He is said to work in close collaboration with the Chief Finance Manager Bonface Wanyonyi, Chief Manage Edwin Korir and the Internal Audit and Risk Management head Willis Ombai.

Mr Shaiye earlier contract(s) to manage the Fund expired in November 2020 but was extended by the Head of the Civil Service for a year that expired in November 2021, however, even after the expiry of his contract last year, the CEO remains in office.

The CEO is also accused of misusing government resources in Tana River County on a massive personal/private rice-growing project where he is personally involved.

He allegedly uses government vehicles and personnel to execute private activities. His drivers and trusted employees among others are made to travel and are paid from the WSTF accounts in the rice development on the expansive farm in Tana River County for personal and not public gain.

The document states: “This is not happening as a one-off affair but for whole rice growing seasons. We understand that the CEO has caused massive fears at the WSTF headquarters that nobody can dare stand in his way whenever he wants anything done, legal or illegal – an untouchable kingpin.”

There is also the critical question of Mr Shaiye’s frequent travels out of the country without authorization from the Head of the Civil Service as it should be. He recently travelled to Turkey for unknown business without clearance. Soon after he came back to Kenya, he was overhead publicly bragging that he enjoys protection from the Judicial Service to the Ethics and Anti-Corruption Commission (EACC) and the office of the DPP.

It is also emerging that donors have in recent years increasingly piled pressure on the Fund to perform as per laid down agreements while seeking clarification on the official tenure of the CEO.

“This is a key barometer of proper governance in any institution that is funded largely by taxpayers,” the systems had been established and eroded overtime for personal gain.

Some of the donors like Finland and Sweden are set to pull out from financing water resources projects. The CEO’s extended tenure has rattled the donors the wrong way and they now strongly feel that they have been badly slighted by impunity, therefore the future of the fund is in total jeopardy.

That for a long time the fund has been heavily reliant on robust operating systems as a financing institution, but over time the systems have been eroded and heavily destabilised under Mr Shaiye’s tenure for personal gains.

There is also the question of interns being flooded into the institution daily at the whims of the CEO instead of through official recommendations from the Public Service Commission as required by law.

There is also the critical matter of the Fund’s management board which has tried to steer its operations and activities as oversight within the law, but that has been persistently undermined by the CEO who has been trying to compromise some of them to pander to his whims.

“The prudence in financial management and discipline is highly questionable and there are burning queries whether all required approvals for such expenditures had or have been sought from the ministry headquarters,” said an insider.

It is also emerging that the Fund is now facing an endless deluge of legal battles in courts some of which top ministry officials have been dragged into and the CEO is allegedly draining the Fund’s coffers in legal fees to try and ward off these battles.

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