New boss for troubled NSSF

October 17, 2008
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, NAIROBI, October 17 – Albert Odero has been appointed the Acting Managing Trustee at the bedevilled National Social Security Fund (NSSF), with immediate effect.

Mr Odero, who formerly served as the General Manager, Corporate Services at the Fund, replaces James Akoya who was interdicted with six other managers on Wednesday for failing to secure Shares Certificates worth Sh1.4 billion with troubled stock broker, Discount Securities Limited (DSL).

The new top dog has assured all employees, employers and contributors that ‘measures have been put in place to ascertain that the Fund continues to carry out its obligations as stipulated by the NSSF Act’.

“This includes a Performance Contract with the Government and the Service Delivery Charter,” according to a statement issued late Friday by the NSSF. Odero, who joined the Fund in 2003, holds a Masters Degree in Public Administration and has worked in senior positions in both the public and private sectors, including the Office of the President and Safaricom Limited.

The Fund has been dogged by controversy over gross mismanagement resulting in several sackings since late August.

On Thursday, Labour Minister John Munyes dissolved the NSSF Board of Trustees and appointed two deputies to oversee activities at the Fund.
 
Mr Munyes cited a preliminary report which showed that the Fund stood to lose nearly Sh1.4 billion through the DSL saga.

“We have established that the Board approved a purchase of shares worth Sh2 billion but it has since emerged that NSSF does not have share certificates worth approximately Sh1.4 billion. NSSF could lose this money, if Discount Securities does not deliver the shares in form of the certificates,” the Minister had told reporters.

He said investigations by the Inspectorate of State Corporations had also uncovered impropriety in the disposal of a plot of land located along Kenyatta Avenue, recruitment of staff and procurement proposals.

“The investigations have revealed impropriety in all these areas thus the need for the board, which has the oversight responsibility, to step aside to facilitate a full audit,” he stressed.

It had emerged that some people at NSSF were colluding with certain officials from the brokerage firm to buy shares at a much lower price and later sell the same to NSSF at a higher rate. In addition, when former Managing Trustee Rachel Lumbasyo was sent on compulsory leave in August, the fund is said to have dumped millions of Kenya Commercial Bank shares at a throw-away price.

Mr Munyes called it a scam and said a forensic audit of the NSSF would be carried out to ascertain whether its asset portfolio of about Sh82 billion exists.

“A lot is going to be unearthed and all these issues and more will come out. I have said before I look at NSSF as a cloud, I don’t understand it and that is why I wanted to make those changes. We have to look for that money,” vowed the Minister.

The Labour Minister further revealed that the matter was never detected by the Controller and Auditor General.

NSSF had been trading with the stockbroker but the minister disclosed that they stopped dealing with them in 2007, when problems emerged. NSSF has also invested in the equities market through seven other stockbrokerage firms but it is not clear what percentage has been put in the stock market.

The matter also came up in Parliament on Thursday afternoon and Mr Munyes has promised to issue a ministerial statement next week.

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