The Ksh 16 billion edible oil scam led to the arrest of former KNTC CEO Pamela Mutua and Head of Procurement Amos Juma Sikuku.
The arrests came after the Directorate of Criminal Investigations (DCI) questioned Pamela Mutua, the Chief Executive Officer of Kenya National Trading Corporation (KNTC), about her alleged involvement in the Ksh. 16.5 billion edible oil scandal in November 2023.
Police detained senior state agency executives, including Ms. Mutua, on Monday night and held them overnight.
In June of this year, it became apparent that businesses owned by individuals with connections to the government were the only ones purchasing edible oils through KNTC.
It all started in October last year when Cabinet gave KNTC—a division of the Ministry of Investments, Trade, and Industry—the all-clear.
“The Cabinet adopted the structure to position the Kenya National Trading Corporation as the anchor of governmental efforts to establish a price balancer for fundamental consumer food items,” the Cabinet memo said, addressing the expense of living.
“KNTC will use its resources and infrastructure to help stabilise price swings for necessities that are out of the ordinary and detrimental to the general welfare.”
On the other hand, the National Assembly received a document revealing a contract for KNTC single-sourced firms to import 125,000 metric tonnes of edible oil.
Shehena Trading Commodity Limited, a 100% owned business by Invest Africa-FZCO, received the local purchase order. Wilfred Saroni, who reportedly has connections to Cabinet Secretary Moses Kuria, leads the company, which is based in a free zone in Dubai.
Another company is Multi Commerce FZC, which is allegedly under the control of a well-known businessman associated with a sizable new mall in Eastleigh and registered in a free zone in Dubai.
The customs entry paperwork revealed that KNTC failed to pay a total of 42.5% in taxes, including unpaid customs duty (35%), import declaration fees (3.5%), railway development levy (2.0%), and agricultural food authority levy (20%).
Like KEMSA in the COVID-19 procurement scandal, KNTC is having trouble offsetting its stock’s high price.
If the state corporation loses, taxpayers would lose Ksh. 6 billion, and its goal of providing less expensive alternatives is just rhetoric.