Seven YEDF staffers suspended in irregular loan pay-outs probe

March 5, 2018 3:31 pm
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Fund’s Chairman Ronald Osumba stated that those suspended include the Lending and Investment Manager and the Senior Accountant who are accused of complicity and negligence of their duties/FILE

, NAIROBI, Kenya, Mar 5 – Seven staff members at the Youth Enterprise Development Fund (YEDF) have been suspended to allow a probe into irregular loan disbursements.

In a statement, the Fund’s Chairman Ronald Osumba stated that those suspended include the Lending and Investment Manager and the Senior Accountant who are accused of complicity and negligence of their duties.

“In the process of migrating the fund’s data to the new ERP system that includes beneficiary loan details, management noted some discrepancy in the loans. The Board was notified on 6th February 2018 and consequently commissioned a special internal audit on the discrepancies,” he stated.

Osumba said that the organization has also undertaken staff changes particularly within the Finance and Credit Departments.

“The audit report was tabled before the board on 2nd March 2018 and has identified some instances of irregular disbursements. In view of the Board’s fiduciary duty to safeguard the use of public resource and out of the abundance of caution, the board has taken measures in order to safeguard public resources,” he said.

He also revealed that the Treasury has been invited to carry out a special and independent audit to determine the extent of the problem.

He also indicated that the Directorate of Criminal Investigations have also been brought in to investigate and determine criminal liability on both its staff and the receipts of the loans.

“His Excellency the President has repeatedly directed all public officers to perform their duties diligently and with integrity. My board has the responsibility to ensure that this directive is complied with and will act decisively for the public good.”

In 2015, the fund’s then Chief Executive Officer, Catherine Namuye, was suspended after the Banking Fraud Unit flagged suspicious transactions in the Youth Fund account that were brought to the attention of the board.

A year later, the board’s chairman Bruce Odhiambo resigned to allow investigations into the scandal.

Namuye and Odhiambo were later charged with 12 counts of corruption in relation to the loss of Sh180 million of taxpayers’ money.

They had been accused of receiving Sh4.5 million and Sh1.8 million in kickbacks from Quorandum that prosecutors said they had reasons to believe was corruptly acquired from the Youth Enterprise Development Fund.

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