Top Safaricom managers have been named in alleged multi billion shilling tendering irregularities. This comes after the firm last week announced a record Sh38 billion profit for the year ended March 31.
The damning dossier by accounting firm KPMG, details a review of 23 questionable tenders at Safaricom, that were awarded between September 2013 and August 2015.
Safaricom chief financial officer John Tombleson alongside four other senior executives are named in the report as having influenced the purchase of a Sh1.15 billion five-acre piece of land at Garden City where the Safaricom plans to build its headquarters.
Safaricom hired KPMG to conduct an indepth audit of the two dozen tenders over a two-year period, following concerns over their integrity and value to shareholders.
KPMG auditors have also questioned payments worth Sh1.2 billion to seven firms for marketing activations that promote the Safaricom brand and its products.
The audit report also questions Safaricom’s procurement of corporate promotional merchandise worth Sh201 million from Vajas Manufacturers Ltd, Chinese technology firm Huawei’s $12.5 million contract to upgrade the M-Pesa platform, and payments of Sh1.2 billion to media services company Scanad, which is a subsidiary of WPP Scangroup.
The list of doubtful deals at Safaricom includes contracting of South Korean firm Kaon Media to supply set-top boxes ($1.6 million), My 1963 commuter card project with Fibre Space (Sh15 million), the purchase of network spares management from GSM Systems ($2 million) and a billing system from Huawei at a price of Sh839 million.
Safaricom chief executive Bob Collymore has promised to act on the findings of the report having called in KPMG to conduct the audit.
“Action will be taken and uncompromisingly so. We are not shy of addressing integrity questions,” he said at a press conference on May 7, adding that he would not commission such a report and then sweep it under the carpet.
“For the avoidance of doubt, the KPMG’s draft report makes it clear that while there are internal process improvements required, there is absolutely no evidence that any individuals benefited inappropriately from any of Safaricom’s commercial agreements. Allegations to the contrary are completely untrue,” Mr Collymore said.
National Assembly speaker Justin Muturi on May 5 directed the departmental committee on finance, planning and trade to investigate the tender dealings at Safaricom and report back to the House within 60 days.