Grand Regency sale based on non existent law

July 7, 2008 12:00 am

, NAIROBI, July 7 – Kamlesh Pattni, the architect of the Goldenberg scandal, and 16 accomplices were given immunity from pursuit by the Kenya Anti Corruption Commission and the Central Bank of Kenya on April 9th 2008.

The settlement agreement was registered in court on the same day by the Assistant Director of the KACC, Fatuma Sichale, and it was stated that the settlement was pursuant to section 56B of the Anti Corruption and Economic Crimes Act. The settlement states that "the Central Bank of Kenya hereby abandons all its other claims against the defendants." It resulted in the infamous "handover" of the Grand Regency Hotel, and the quick sale of the Grand Regency by the Central Bank.

The trouble is; there is no section 56B of the Anti Corruption and Economic Crimes Act.

At least, there shouldn’t be, or there can’t be; because Parliament deleted section 56B when it was first proposed by the Attorney General and Kenya Anti Corruption Commission on September 13th, 2007. During a debate on amendments to the Anti-Corruption and Economic Crimes Act, in which every clause was subjected to close scrutiny, the question on whether to approve Section 56B was put to the vote and deleted. The proceedings are recorded in The Hansard.

After this deletion, it has never been reintroduced for debate and approval of Parliament again.

Yet, KACC Director, Mr. Aaron Ringera – who incidentally called a press conference on the evening after the passing of that Parliamentary motion to complain about the deletion of Section 56B and other proposed amendments – used this very section to justify Kamlesh Pattni’s immunity, which the latter had obtained in exchange for the Grand Regency Hotel.


Since section 56B was deleted, it follows that it cannot be the basis for any forgiveness of Kamlesh Pattni, and indeed cannot form the basis of any lawful transaction related to the Grand Regency Hotel. Neither can it be used to settle matters related to Anglo Leasing or any other grand corruption investigation.

Plainly put: The Law which forms the basis of the sale of the Grand Regency Hotel, and the forgiving of Kamlesh Pattni by the Central Bank of Kenya and the Kenya Anti Corruption Commission is illegal. It was deleted by Parliament on September 13th 2007, yet someone (somewhere) ‘sneaked’ it back into the Anti Corruption and Economic Crimes Act amendments signed by President Kibaki on Moi Day 2007. The big question is: Who inserted it and why?


These are questions which the Attorney General, the Minister for Justice and the Director of the Kenya Anti Corruption Commission must answer, because it is clear that someone has gone ahead to insert clauses in our Anti Corruption laws without the approval of Parliament. Insertion of unapproved amendments into a law for the President’s assent is an unconstitutional and criminal act.

The Attorney General, the Minister for Justice and the Director of the Kenya Anti Corruption Commission must be fully aware that on September 13th 2007 Parliament (sitting as the Committee of the Whole House) deleted many of their proposed amendments, including section 56B of the ACECA – the basis of the Grand Regency Hotel settlement with Kamlesh Pattni, Uhuru Highway Development Company and 15 other persons.

In breach of their public duty, The Attorney General, the Minister for Justice and the Director of the Kenya Anti Corruption Commission, have gone ahead with transactions based on an illegal law, and have done nothing to correct the illegality despite notice, including written requests for clarification and action made by the Chairman of the Kenya National Commission on Human Rights.

The Hansard of Parliament for Thursday September 13th 2007 at page 3929 shows clearly that both Martha Karua and Amos Wako were in Parliament when Section 56B was deleted. Even as he participates in sub-committee investigations into his cabinet colleague the Minister for Finance, why has the Attorney General not advised his colleagues that the Grand Regency Hotel sale is based on a Law which is illegal because it was deleted by Parliament?


"I want to assure you of my personal commitment and that of my Government to quickly deal with all the corruption and economic crimes of the past and present including the Goldenberg Scam, Anglo-leasing, the Ndungu Commission report and the Parliamentary Public Accounts and Public Investment counterparts," said President Mwai Kibaki, on the occasion of receiving the Goldenberg Commission Report, 9th February 2006

The time has come to widen the search for the truth on the Grand Regency Hotel scandal, and in particular to investigate the motivation and acts of the Attorney General and the Minister for Justice who have allowed an illegal law to cost Kenyans the Grand Regency Hotel.

Also culpable is the Director of the Kenya Anti Corruption Commission who, despite having been notified last year that section 56B was illegal, went ahead to enter into a consent agreement with the architect of the Goldenberg scandal which cost Kenyans over Sh158 billion, according to the Report of the Goldenberg Commission of Inquiry.

It is shocking but true that the statutory immunity which Kamlesh Pattni believes he enjoys was illegally given to him by the custodians of public interest in matters of grand corruption: the Attorney General, the Minister for Justice and the Director of the Kenya Anti Corruption Commission.


The Grand Regency scandal is a basis for Parliament to make a full inquiry into what has been going on at the Treasury over the past one year. This inquiry should focus on – but not be limited to – the following suspicious transactions:

– the inclusion in this year’s budget of bogus payments for the fictitious Ken Ren Fertiliser Factory and payments for alleged credit advances to Kenya to buy a Navy Ship

– the spectacular collapse of brokerage firms at the NSE

– the Safaricom and Telkom privatization

– the De La Rue currency printing contract.

Kenyans are entitled, not only to full information about what our money is being used for, but also to the assurance that the managers at the Treasury can be trusted.

(Mwalimu Mati is the CEO, Mars Group Kenya)

Disclaimer: The views expressed in this article are purely those of the author and do not in any way reflect the views of Capital News or the publisher.

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