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Thursday, September 06, 2007

Gideon's Trip With His Father To Banks In Luxembourg

Kroll Report on Kenyan Corruption, Digest

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Mukesh Gohil reveals that by 2002 Gideon Moi's cash in foreign banks amounted to a staggering 550 million British pounds. This is only the money that Gideon had involved him in to transact. It is reported that all Gideon's cash left the country through Citibank.

Mukesh insists that a huge amount of this money is in London.

The Kroll report details a fascinating trip that took place towards the end of former president Moi's last term as president where he visited several banks in Luxembourg in an unmarked ordinary car and without any security or escort. Only one State house aide (who was chief of protocal at the time) accompanied them. And even he was left in waiting rooms as father and son had meetings with their bankers behind closed doors. But it was very clear that the purpose of this trip was to introduce the younger Moi to his bankers.

It is believed that during this trip administration of the Moi fortunes was transferred to Gideon. Investigators are still trying to prove that the monies were transferred around the world in a further effort to make it as diffucult as possible for it to be traced back to the Mois.

Incidentally there is plenty of instances in the Kroll Associates report that suggests that the Mois are not too comfortable at the moment as there are too many people running around with their secrets.

A fight that took place at a popular entertainment spot in Nairobi between Gideon Moi and the family lawyer Dr Kiplagat, emphasizes this. Evidence seems to suggest that the fight was instigated by the sale of US$ 650,000 property in South Africa which Dr Kiplagat facilitated in behalf of the younger Moi. After the sale was complete the lawyer did not hand over the proceeds from the sale but instead prepared an invoice for $US 1.5 million for various legal services rendered to Gideon over a lengthy period of time that was still outstanding. He then issued a credit note for US$650,000 and demanded that the balance owed to him be paid. Gideon was furious.

Interestingly this appears to be a contradiction of his own well-voiced principals. The same Kroll report talks about a frequent boast Gideon makes to the effect that any deals worth less than US$ 1 million is not worth his while.

Since December 2003, Gideon has been trying to get the money from the sale of the South African property from Kiplagat, but with no success. On several occasions he sent Chepkonga to demand the cash on his behalf from the lawyer. So when Chepkonga saw the lawyers car parked outside Fairview Hotel, he immeditaley called Gideon who quickly arrived and headed straight to the table where Dr Kiplagat was seated. A fierce argument ensued with Gideon making his usual threats.

Eyewitnesses said that what triggered the fight was the point where Kiplagat told Gideon; "…your father is no longer the president of this country and the days you used to order people around are long gone." To add insult to injury he then ordered Gideon to move to another table. That is when fists and kicks started flying as baffled onlookers watched and other hurried to separate the two men.

It seems that many previously close aides have fallen out with the Moi's in recent times over similar circumstances and others have just moved on sensing that it isn't that profitable to hang around anymore.

(continued)

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1 comment:

Anonymous said...

I JUST GOT THIS IN MY EMAIL....SORRY IT IS NON RELATED...BUT DID NOT KNOW WHERE TO POST...
FOREIGN BANKS ATTEMPTS TO DESTABILISE EQUITY BANK



Dear Kenyans, once again we want to be treated to the theatrics of the neo-colonialists who together with some of our beloved people want to see us revert to the old bad days when banking or financial services was a preserve of a few rich individuals. Banks used to collect deposits from our villages but never lent that money in those villages. This created a vicious conduit of not only impoverishing our country and our people but ensuring that we continued being servants and beggars; and looking up to our International Mother & Father and other like minded institutions for handouts and loans at their own terms /conditional ties. Dear Kenyans like you I remember that the only few banks which were then operating, a big number of them being multi-nationals it was unheard of for farmers, civil servants, jua kali people and ordinary Kenyans to operate accounts there leave alone borrowing. Banking was for who was who in Kenya. My fellow Kenyans why are we forgetting that it even came to a point where without consultation, a few of us who believed in these banks were actually chased like thieves, our accounts closed and told to go to where we belong. Majority of Kenyans like me were left in the wilderness with no banking services. Many like me were grateful that Equity Bank came to our rescue. We found an institution by then a building society, which readily accepted us into their banking halls. Equity took us in despite our a meagre monies, was not concerned whether I was self employed in the Jua kali sector, a civil servant, a farmer or generally a hard working Kenyan trying to make ends meet. Equity knew I just needed a bank where I could keep my hard-earned monies safely, period.



Dear Kenyans I am amazed and greatly disturbed, troubled and extremely offended by the heinous and evil authors of anonymous letters and smses targeted at discrediting Equity Bank which came to my rescue if not of many Kenyans. Of late, the anonymous letters are being handed over bank counters, sent to all postal addresses in Kenya ,emails and posted on blog sites. This has made me carry a research and as an accountant, as a Kenyan first of all and an African I think I do have a responsibility to inform my fellow Kenyans so that we don't go back to the old dark yester years. Who could be the authors of this hate campaign, what is it that they would gain, what does it mean to them, for whose good is it?



Kenyans allow me to explain this. The genesis of all this I suspect came from a letter, which was tabled in our parliament by one of our "honorable" members. The said member could not substantiate the said letter and soon the same letters started going round. My hypothesis is that these hate campaign started with the success of Equity Bank amongst other local indigenous financial institutions. The success story of Equity bank has meant that the players who used to be in charge are being threatened. When Equity ventured out of Nairobi, Central and Eastern Provinces, where it was very successful and moved into hitherto very calm territories of other players i.e. Western, Nyanza, the North Rift, North Eastern & Coast then some feathers were ruffled. The banking institutions which used to lord over in these areas unchecked had been aroused. Their safe havens were no longer safe. These used to be their rich milking grounds, which contributed significantly to their balance sheet and profits. Equity was becoming too much and the challenge was huge. The multi national banks used to have a field day here. Unfortunately they could not match anything that Equity was doing may it be the banks products which were cheap but also the delivery of service. We were being treated like people and not account numbers. As the multinationals could not beat Equity on products and services, then a smear campaign had to be started and the multinationals ganged up. Being clever, they have also considered that they could take us for a ride especially now that elections are around the corner and all the noise that goes with elections. The smear campaign is designed to cast doubts on Equity despite how well Equity performs. It is an evil design to shake public confidence in Equity. Please sample this:



These are the same banks that closed their rural branches and when Kenyans pleaded with them, they were told to go where they belonged. They raised their minimum balances to Kshs.10,000/- and Kshs.30,000/- respectively and closed the accounts of Kenyans without due regard of where Kenyans could receive even their salaries. I shiver when I remember how I was tossed from one branch to another and head office trying to locate my salary. I was treated worse than a beggar. As Kenyans, we need not to be reminded that these banks represent the ownership and beneficial ownership of our colonial masters and perpetuators of apartheid, racial discrimination to our fellow Africans in South Africa. The wealth that these foreign banks make does not develop our country but go to enrich their motherlands Britain and South Africa etc. For how long as Kenyans shall we continue to be used as conveyor belts of transferring our resources to the west?



What is laughable is that these foreign banks, BBK, StanChart etc today have reversed their strategies. They are now re-opening their rural branches and have lowered their account opening and operating balances. In their desperate attempts to hoodwink Kenyans, they have introduced the dangerous consumer unsecured lending which is being promoted through tented kiosks in the streets and casual hawking using drums and even offering uji in banking halls. Do they assume Kenyans are so daft that we can be swayed by the dancing and uji offering theatrics? Are we this cheap?



When Kenyans were chased out of these banks, they trooped to Equity Bank, which became the new home for Kenyans of middle and low income. Equity as their June 2007 figures shows has over 1.3 million accounts, accounting for nearly 36% of all bank accounts in the country. Equity offers ledger free accounts, account maintenance fee free accounts. Equity maintains zero account opening and account operating minimum balances. Equity bank is the only bank whose charge over the counter withdrawal is Kshs.50/- while Barclays and Standard charge over the counter is over 10 times at Kshs.500/- to Kshs.600/- respectively. Equity allows customers to deposit free of charge while this foreign banks charge 0.25% cash deposit fee. Who is fooling who?



The design is to destabilize Equity Bank so that Kenyans can troop back to their new neo-colonialism net of economic exploitation through their recently opened branches. I am reliably informed that their strategy will fail if they do not destabilize and eventually kill Equity and hence reasons they are hell-bent to malign Equity. Unfortunately, these multinationals cannot be able to raise any Corporate and performance issues because since becoming a commercial bank, Equity has been rated better than Barclays for 3 consecutive years (Refer to Market Intelligence and Bank Survey for year 2005, 2006 and recently 2007). Read the papers particularly on Barclays Bank and internal fraud, a poor teacher Kenya Shillings 580,000 loan diverted to staff account due to fraud by a Barclays bank staff. This is just a tip of the ice berg.



As an accountant I went further to investigate all the issues raised in the anonymous letters and even a circulating letter purposed to be signed by a former director of Equity Bank Wanjiku Mugane and below are my findings;-



Wanjiku Mugane was a director of Equity until July 2006 when she was sacked by the bank for insubordination and working for foreign banks to leak out trade & strategy secrets. Within 2 weeks of being sacked, Wanjiku's Company First Africa Capital was acquired by Standard Chartered Bank a proof that she had been acting as a mole inside Equity. (Read Standard Newspaper StanChart acquires 25 pc equity stake in First Africa Published on July 18, 2006 ).

African colonialist at her best.



The CEO shareholding: The CEO's shareholding stands at 7.2%, which is above the 5% prescribed by Central Bank of Kenya prudential guidelines. The CEO in September 2005 while submitting the banks listing had signed among other shareholders a bond with CMA to hold his shares for a period of 2 years. This bond became a contract with the investing public because it was included in the banks prospectus or information memorandum. In June 2006, nearly 1 year after the public contract the CBK introduced the prudential guidelines that previously prescribed 25% by reducing the limit of CEO shareholding to 5%. Caught between the 2 complicating laws the CEO applied to CBK and CMA to consider the situation and advice him on how to comply with the conflicting laws. As would have been expected the public contract had greater implication to the bank and the CEO was granted exemption to the 5% rule for the period of bond up to August 2008. This was the only prudent and logical thing that any rational being could have done.



Governance: Equity Board is made of professionals of great repute. Sample this Dr. Julius Kipngetich the MD of Kenya Wildlife Services and formerly of Kenya Investment Promotion Centre, a leading management and strategic guru in Kenya. Mr. Ernest Nzovu a Director of Hawkins and Associates, the leading Human Resource Consultant in the country. Mr. Linus Gitahi the Group Chief Executive of Nation Media Group and previously the MD of GSK (GlaxoSmithKline) in Nigeria. Mr. Benson Wairegi, the Group Managing Director of British American Investment Co. Ltd previously Audit manager with Pricewaterhousecoopers. What of James Mwangi a UN Advisor on Inclusive Financial Sectors and a 2007 Global Vision Award winner in Microfinance along side Noble Laurent Winner 2007 Prof. Muhammad Yunus of Grameen Bank, Mr. Wagane Diouf of Senegal and the Managing Partner of Africap Microfinance Fund based in South Africa. These are the professionals among other board members who have proven their worth in the organizations they are leading.



Capital injected in 2003 constituted Kshs.120 million fresh capital. The Kshs.120 million injection was by the IFC & EIB through Africap Fund who became the single biggest shareholder with 16% shareholding. See audited accounts 2003/2004. It is naïve to mislead the Kenya public that this was a capital injection by the CEO and MD while it is a fact that can be ascertained, no wonder he has not found it necessary to waste his breath and loose his focus by responding.



I have established from an independent audit carried out by world-renowned KPMG & the Information Memorandum that Equity Banks CEO shareholding in the bank is as follows; for the CEO to have 19.8 million shares today, which benefited from bonus shares and share split he had roughly invested around Kshs 7.5 million by 1999 before the first split. He invested a further Kshs 25 million equivalent to 183,823 shares in 2004 out of the initial investors who formed Equity Bank with kshs.725 million. The CEO has benefited like any other shareholder of Equity from the banks rapid growth and its profitability and its retention policy with subsequent capitalization of revenue reserves from Bonus shares. The same is true for all other staff members whose shareholding has been questioned, maximum investments of 4million Kenya shillings in year 2000 . Do the math's its not that hard.



Equity's visionary leadership introduced shareholding scheme in 1997 and the management like other employees have participated in the shareholding. Thanks to the visionary leadership.



Equity Loan Book The bank has one of the best loan books in the country. The global credit rating of South Africa in April 2007 rated the bank both short-term and long-term loan A+ while Microrate of USA has rated Equity as a high global performer of the investment grade.



Leadership and succession planning. The leadership of the bank is in the hands of 8 distinguished board members whose standing in society and reputation is excellent. Equity with due respect to other boards is one of the best boards. The management of the bank is in the hands of highly experienced bankers and managers. Sample the following; 2007 Global Vision Award winner in microfinance, Former Marketing Director, of GSK for Eastern and West Africa, Former Head of Shared Services of Standard Chartered Bank covering 14 countries and formerly the Finance Director in Tanzania and Zimbabwe, Former Human Resources Manager for Colman for Africa and Middle East, etc. These are Kenyan leaders who we should be proud of. They have proven their performance by making Equity the Best rated Kenyan owned bank for 3 consecutive years, driving the bank with the lowest charges yet the highest return on Equity and on Assets due to the high level of efficiency and the most innovative bank developing products appropriate for Kenyans which now banks are falling over each other to ape.

Procurement of Banking Software The malicious hate campaign in the emails circulating indicates the bank acquired its banking software at a cost of Kshs.1 billion. The actual figure of the Finacle banking software as per the quotation is only US$1.6 million see the KPMG report and annual Audited accounts 2005,2006 or Kshs.110 million only at the exchange rate of Ksh.67/- to the dollar. One out-rightly sees the much exaggeration to create doubt on Corporate Governance. The Fixed Assets schedule in the audited accounts of the bank is very clear.

NSE Share Valuation for Equity Shares The allegations that Equity Bank's shares price is manipulated at the Nairobi Stock Exchange cannot be supported by figures. Market mechanisms are beyond manipulation in an electronic market. The facts bear and support Equity's superior pricing as at 30th June 2007.



Institution ROA ROA ROE ROE P/E

(Before tax) (After tax) (Before tax) (After tax) Ratio



Equity Bank 6.94 5.55 72.79 58.23 45.79

Barclays 5.20 3.62 44.86 31.24 22.66

Standard 4.95 3.42 43.16 29.82 20.62

Banking Industry Av. 3.85 2.72 34.15 24.19 26.89



Looking at the figures, Equity's Return on Equity and Return on Assets after Tax is nearly 2 times that of either Standard or Barclays bank hence its pricing earning ratio is also double. Figures never lie. Comparing Equity with the industry average it is performing at least 2½ times better than the industry average and hence can even support a higher price earning ratio than is currently the case.

Allegations of Being a Favored Bank. From the figures, Equity's growth is from the liability side as opposed from the Asset side. It had Kshs.23 billion in deposits spread over 1.3 million customers and only Kshs.14 billion in loans held by 280,000 loan customers. We should remember that Equity has been a darling of many Kenyans because it developed its products appropriately priced them affordably and made them accessible through their large rural branch network. No wonder again for more than 5 years it has been the fastest growing bank in Kenya. Let us stop allegations and insinuations that are out rightly wrong. On the contrary Barclays and Standard Chartered are the major beneficially of all government donor financed projects and a sizeable number of parastatals. By the way, should it be the time our government reviewed this policy if it is truly a government of Kenyans? It should be banking with Kenyan institutions as a sign of faith in the Kenyan people. After all Equity is rated strongly than Barclays and is listed in NSE and priced by the market better than these multinationals.



To the Kenyan public Let us stop being misled through propaganda to destabilize the bank we created when we were chased like thieves out of foreign banks. We are being hoodwinked to the neo-colonialists of today. For a longtime, nearly 100 years that BBK and Stanchart have been in Kenya, they have only been paying lip services to their social responsibility as corporate citizens. With its meagre resources, Equity bank has been sponsoring Kenyans (best girl) and (best boy) in their KCSE in every district of operation for their university education as a way of giving back since 1997. Recently my wife who is a teacher in one of the primary schools informs me that for the last 3 years Equity has been sponsoring Kenyans children under the theme of "Our culture and values – indigenizing our investments) through the Kenya National School and Colleges drama and music festivals. Equity has spent money and light up Thika Road , Outering, Gikomba and Ladhies Road together with parts of Jogoo Road. What has these multinationals done for all these decades they have been milking us?



The truth needs to be told and it is time as Kenyans we took responsibility for the sake of our children. With Equity empowering the ordinary Kenyans through savings and loans, we would expect our children to live better lives than ourselves. We must open our eyes to see the evil designs of the economic neo-colonialists in the foreign banks.



As an enlightened people together with the financial elites in this country it is time we stopped seeing Equity as the bank of the low income. Equity is highly rated better than these multinationals and we need to start banking with it since our money would be safe and would be working through small loans to uplift the living standards of our people and fellow Kenyans; and hence bringing equity by bridging the gap between the rich and poor for long-term stability of our country. Let us continue asking ourselves these questions:

If Equity is doomed to fail, why are other banks literally hawking to ape them?

What about the Muhindi banks? Check them out. Even the multi nationals, who owns them? How come nobody talks about them?
Let me hit to other areas:
How many Banks will sit down and listen to you even when all you have is a credible idea? Only Equity.
How many Banks will assist a black man/woman procure a Bid Bond for Tendering processes? Only one, Equity.
How many banks will open branches at locations that are considered shit by other banks because the people residing there are shit? Only Equity.
How many truly successful banks are there in Africa that can truly be called indigenous? Only Equity.
Why is Equity under so much hate pressure? Because anyone successful is disliked and especially us Africans maybe Kenyans we are worse majority of us have PHDs...Pull Him/Her Down. Are there some lessons we can learn from our Nigerian brothers and sisters. First Nigeria then the World. Why can't we have Kenyan First then the rest of the world?
What should Equity do in light of this kind of PR? Continue with what they are doing. At least Kenyans are more informed and knowledgeable to know and appreciate that only Kenyans shall develop and grow Kenya not the foreigners.
May Equity continue to serve Kenyans. Do you remember the person who started a bank in Bangladesh to assist the poor and low-income people? Equity is doing the same thing. It is a great pity that such a noble idea should be met with such hostility. However, this is not the first time, neither the last that it will happen.
Africanus Scipio was once advised in a dream by his great grand dad:

"Mark this, for this thought will steel your determination to rush to the defense of the people you serve. Every man who has preserved or defended his country, or has made it greater, is reserved a special place in heaven, where he enjoys an eternal life of happiness."
Concerning yourself, never lose hope that you might come back here one day. For this is the place which offers great and magnificent men their true reward, for all fame or glory you win among mere human beings should simply be ignored, since such fame and glory can scarcely be said to be eternal if it cannot last one Great Year. Fix your gaze upwards, then! Think on this place, a dwelling place for all eternity! Then you will no longer have any use for what the masses might say about you or for any human rewards, your achievements may merit. Rather, let Virtue herself, by her own unclad beauty; call you to a true and genuine glory.
Ignore what people say about you, for they will say it anyway and whatever words they may say will not pass beyond the narrow bounds you see below you. Nothing anyone has ever said has ever abided, for when people die, their words die, too; the future forgets them and tosses them on the rubbish heap of oblivion."

Mahatma Gandhi once said- First they ignore you, then they laugh at you, then they Fight You AND THEN YOU WIN!!! God Bless us as we liberate ourselves from mental slavery!!

We can only reclaim OUR WEALTH if we have indigenous banks that work for us and with us. May Equity continue to serve Kenyans by empowering them to drive Kenya and the rest of Africa . Bravo Equity for showing that we can truly be proud as Kenyans and as Africans. May you be blessed for giving us back our dignity, confidence, self worth and self respect which had been taken away.



Equity we are behind you for truly, this is our country and no foreigner should tell us how to manage our affairs. We will support you because truly you have shown you are a world-class organization, no wonder you were voted the Best Bank in Kenya by Euromoney Awards for Excellence 2007. Wenye wivu shauri yao na wajinyoge!!!!.

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