Police detectives have arrested Rongo MP Paul Odalo over alleged conflict of interest and alleged theft of KES 122 million of public funds. Officers from the Ethics and Anti- Corruption Commission (EACC) said, “The embezzlement is perpetrated largely through conflict of interest, multi-million payments for services not rendered and payroll fraud involving ghost workers,” it added.

According to a notice from EACC, Mr. Odalo was arrested on Thursday over claims of graft at the constituency fund after raids on his rural and Nairobi homes. Preliminary investigations by EACC revealed that the accused collaborated with a Mr. Christopher Abuor to register a company, Aztec Infrastructure Kenya Ltd, as directors and used it to trade with Rongo Constituency NG-CDF. 

Through the company, they build classrooms and drill boreholes and have so far received KES122 million from the fund. The MP is the sole signatory to the company's bank account.

Furthermore, Mr. Odalo registered another company, Jebset Holdings Limited, using his assistant’s credentials, and has so far been paid KES19.6 million by the Rongo Constituency NG-CDF. The personal assistant is also the sole director and signatory to the company's bank account 

However, EACC added that these were only a few of the matters the MP is under investigation for. “The Rongo Constituency matter is part of broader investigations by the Commission into numerous reports of embezzlement of public funds under the NG-CDF, National Government Affirmative Fund (NGAAF), Women Enterprise Fund and the devolved funds,” reads part of the notice.

Ironically, the MP recently proposed the Public Finance Management (Amendment) Bill, 2024, seeking to improve the efficiency of managing conditional allocations to counties by eliminating duplication and streamlining the transfer process.

Sponsored by Paul Odalo, the Bill notes that any state officer found to have diverted funds from these accounts would face severe consequences, including dismissal and a jail term. “All funds disbursed by the National Treasury to ministries and state departments, state agencies, and parastatals for approved projects shall be deposited in the designated project-specific bank accounts,” reads the Bill.

According to Odalo, the accounts will be managed exclusively for the project they are intended for and any officer found guilty of misusing funds from these accounts will be penalized with a fine equivalent to 150 percent of the misused amount. 

“The fine is recoverable as a debt owed to the government. In addition, the officer will face immediate suspension and potential dismissal, subject to an investigation. The officer shall be liable to a term of imprisonment not exceeding five years upon conviction,” the Bill reads.

“Any bank found to have facilitated the unauthorized withdrawal or transfer of funds from project-specific accounts shall be subject to financial penalties and other legal actions as determined by CBK,” he added.

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