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Corruption scandal outrages Kenyans, undermines government

NAIROBI, Kenya—In Kenya, one of the world's most corrupt countries, the bar for public outrage at official misconduct is set pretty high. But a major new scandal involving top government figures has shocked even the most jaded Kenyans.

Last month, a leading Kenyan newspaper published a detailed account by the country's former anticorruption czar of his investigation into millions of dollars in government security contracts to a company called Anglo Leasing and Finance—which, he found, never existed.

The report describes how the company was a shell for some key members of President Mwai Kibaki's government. Their dealings with crooked businessmen, along with tales of blackmail, taped conversations and death threats, have captivated Kenya in recent weeks and further undermined Kibaki's struggling administration.

The Cabinet ministers behind the scandal have been dropped, and on Friday hundreds marched in a demonstration in central Nairobi calling for the ouster of the vice president, Moody Awori, who also was involved. This comes two months after Kibaki reorganized the Cabinet when his bid to expand presidential powers through a new constitution was soundly rejected in a nationwide referendum.

That vote was widely seen as a referendum on Kibaki himself. A respected economist, he was elected in 2002 on a pledge to clean house following the 24-year tenure of Daniel Arap Moi, which entrenched graft of all sizes into the lives of ordinary Kenyans.

Under Moi, people grew accustomed to paying their way out of speeding tickets and other little fixes with "kitu kidogo," bribes starting from about $1.50. Kenya's biggest financial scandal also happened on Moi's watch—the so-called Goldenberg affair, in which $1 billion in public funds was lost in a scheme that paid friends of Cabinet ministers to export non-existent gold and diamonds.

In recent weeks it's become clear that Kibaki's administration—which includes many former Moi people—has not been much cleaner. Just days after the Anglo Leasing scandal hit newspaper front pages, the anticorruption group Transparency International reported that the government had spent $12 million on luxury cars between 2003 and 2004.

The timing of these revelations couldn't be worse for Kibaki, as millions of rural Kenyans are facing starvation in East Africa's worst drought in decades. This month the World Bank froze $265 million in loans to Kenya, citing concerns over corruption.

"We have lost all priorities," said Gathigia Muriuki, a 27-year-old Nairobi entrepreneur. "Right now they can afford to buy cars ... while people are dying of hunger.

"Kibaki has not lived up to his pledge—he has let us down."

The man at the center of the storm is John Githongo, whom Kibaki appointed to the post of anticorruption czar shortly after he was elected. A former journalist and head of Transparency International's Kenya office, Githongo began investigating the suspicious Anglo Leasing contracts in 2004.

Githongo found that Cabinet officials had arranged for the company to be awarded a $40 million contract to produce tamperproof passports. A separate parliamentary probe found it also had a deal to build a $600 million forensics laboratory.

Githongo's investigation was ongoing last January when he resigned his post and fled to exile in Britain. Colleagues at the time said he had made powerful enemies and felt his life was threatened.

In November, Githongo sent a report to Kibaki on Anglo Leasing, which was published by newspapers last month. In it he said officials told him the stolen money was to be used for political campaigns and warned him to back off his investigation.

Githongo secretly taped many of these conversations. In a tape played for the BBC this month, Kiraitu Murungi, then the justice minister, is heard telling him that if he were to back off, a large loan that his father owed to a prominent businessman might be forgiven.

Murungi resigned on Feb. 13. Two other Kibaki allies accused of blocking Githongo's investigation—finance minister David Mwiraria and former national security minister Chris Murungaru—also have been dropped.

In the middle of it all is Kibaki, 74. Githongo wrote in his report that he briefed Kibaki several times during his investigation, but the president took little action.

For now, however, Kibaki hasn't been directly implicated, and observers believe he is unlikely to step down before his term expires next year.

(Bengali reported from Kampala, Uganda, Knight Ridder special correspondent Kilongi from Nairobi.)