Auction Stopped: EACC Flags Suspected Fake Ksh17M Debt at Matili Technical Institute

Ethics and Anti-corruption commission (EACC) has rescued Matili technical training institute to lose its property to auctioneers after realizing that a Ksh17 million debt claim filed by a contractor was false and fraudulent.

Orders were passed by the Bungoma High Court to prevent an auction of the assets of the institution by a construction company whose investigations by EACC had shown that the so-called debt was actually paid several years ago. This decision was reached following a move by the contractor to confiscate and auction off some of the most vital properties of the institution under the pretext of the institution owing it some money in work in 2010.

As per the court records, Lady Justice Mwanaisha passed stay orders that blocked the transfer of ownership of the driving school vehicle of the institute that had already been sold in a public auction. Some of the items that the contractor seized as part of the exercise to recover the alleged debt included the car.

A spokesperson at the organization claimed that the auctioning had grossly affected the operations of the institution especially in the driving school which trains hundreds of students per term.

The official claimed that it has had a bad impact on us since a majority of the trainees are dependent on these vehicles to fulfill their driving courses.

The EACC applied to court after establishing that the claim of this contractor was fraudulent. The findings of the commission indicated that the company had completed payment of all its works by 2017 but proceeded to sue the institution in 2020 and got a court judgment in the tune of an extra Ksh17m.

The ruling of the court made possible by EACC is a massive relief as another official stated. It is an institution where there are more than 15,000 students and the loss of our vehicles and equipment would have been catastrophic. The fact that somebody could attempt to steal the property of the people even after the payment is shocking.

The stay orders will be suspended until the full application of the EACC is heard and decided.

When submitting the case to the court, the anti-graft agency was able to justify the previous ruling in favour of the contractor as being founded on false information. The court even at the time was yet to be put in the knowledge that the debt was already settled.

EACC Chief Executive Officer Abdi Ahmed Mohamud affirmed that all the payments to the contractor were investigated and revealed that the company had been fully compensated to work on the project between November 2016 and April 2017. This notwithstanding, the company sued in 2020, covering up the payment and purporting a non-existent balance.

Even the contractor had issued the institute with a notice of auction where he listed a variety of items including vehicles and training equipment, generators, computers and even food that can be used by the students. According to the officials, had there been the auction, the learning would have been crippled at the institution.

The funding of these assets was done by government and student fees. It is inconceivable that they might find themselves in the hands of somebody who gamed the system, declared one of the officials.

The conflict between Matili Technical Training Institute and Ramagon Construction Company can be traced back to July 2011 when the company was awarded a tender of Ksh29.3 million to construct a Twin Workshop Complex. The value of the contract was subsequently changed to Ksh58.9 million to enable expansion.

The project was finished and delivered in July 2013, and the institute paid Ksh49.9 million and left a balance of Ksh9 million. According to EACC, the balance was later cleared in installments by 2017, several years prior to the reappearance of the contractor in court to seek another KSh17 million.

EACC alleged that the company had suppressed evidence of payment in its case, which had deceived the court to grant a favorable verdict. According to the commission, the bid to auction the school property amounted to a misuse of the legal process and a conspiracy to illegally acquire the assets of the people.

The court orders allowed EACC to ensure that the property of the institution was not lost to fraudulent claims as well as the taxpayer money, which would have been lost to fraudulent claims. The case is under the review since the commission continues with the legal course to unveil and prosecute the individuals behind the scheme.