NAIROBI, Kenya, Feb 28 – Sanlam General Insurance has clarified that it issued a 5-year payment guarantee bond to the Italian firm at the centre of the Sh63 billion Kimwarer Multi-purpose Dam graft investigations.
In a statement, the insurer said the Italian company, CMC Itenera, paid Sh47 million which was 50 percent of the full premium value following the requirement by the client, the Kerio Valley Development Authority (KVDA).
“On 11th July 2018 and 30th August 2018, we received letters from the Ministry of East African Community (EAC) and Regional development, requesting us to confirm the authenticity of the bond, which we did in writing and sent to them,” said Sanlam Kenya Chief Executive Patrick Tumbo.
Tumbo said that CMC wrote a letter in September last year citing that the Authority needed the bond replaced with a Bank Guarantee.
“The bond was cancelled from our records on 31st October 2018 and no cash refund to CMC was made on our side as the client utilized the funds in full to obtain a Bank Guarantee. The premium funds earlier advanced to Sanlam were therefore paid out to the bank providing the Bank Guarantee for the client,” said Tumbo.
Tumbo said the engagement was a normal business transaction undertaken by the relevant business heads.
The Directorate of Criminal Investigations is currently probing alleged kickbacks and bribes over the stalled multi-billion construction of two dams in Elgeyo Marakwet.
The insurer said it is cooperating with investigators in the probe that has so far seen directors of 107 firms summoned to DCI headquarters to shed light in the stalled projects.