Local Authorities Provident Fund (Lapfund) is now facing losses amounting to millions allegedly orchestrated by the CEO David Koross.
Lapfund is a state corporation that manages pension funds for employees of county governments and other bodies like water companies.
According to inside sources, Koross has been the mastermind of contracts that have seen the body lose millions of shillings, which he receives as kickbacks with his cronies.
For instance, it is alleged that the development and construction of Mavoko Gardens Estate in Syokimaun was estimated to cost Ksh700 million but to date Ksh1.2 billion has been sunk. Our mole informs that Mr Koross pocketed 60 million in kickbacks.
Also, the development, construction and renovation of Golf View Apartments has cost the fund over Ksh1.5 billion. Currently the building is closed for renovation at an estimated cost of Ksh133 million. The same contractor was involved in both Mavoko Gardens.
On top of it, funds amounting to over Ksh11 million stolen from Golf View apartments has been written off in as bad debts.
Insiders say that a property agent selling Mavoko Gardens was allowed to retain Ksh8 million received on behalf of Lapfund for over two years
Koross and his allies are also accused of purchasing properties in exegerated prices, and in turn pocketing the surplus.In one case, they bought 30 acres in Kitengela at exorbitant price of Ksh10 million per acre from a broker, while the market price at the time was Ksh5 million per acre. The land is disputed by the owners and they have taken Lapfund to court.
Koross also orchestrated purchase of the land in Bellevue South C, purchased at Ksh500 million per acre. A suspicious payment of an extra over Ksh300 million was paid in early 2019 one year after the transfer was done.
Kenyan Guardian learns that procurement of architectural/property development consultants amounting to over Ksh150 million was done through restricted tender against the Public Procurement Act provisions.
Currently, the property portfolio is over 10 percent threshold recommended by Retirements Benefits Authority.
“The CEO survives by bribing and compromising anybody who tries to raise a finger and if the trend continues the fund will be depleted of pensioners’ benefits. Politicians and other cartels collect money at will from the fund. He (Koross) has protection from political players and other business cartels,” says our source.
Stakeholders are now calling upon the Directorate of Criminal Investigation (DCI), Ethics and Anti-corruption Commission (EACC) to investigate the issue and bring culprits to book.