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Special Report

How A World Bank Multibillion Funded Project Could Go Into Flames




In 2020, the Auditor General, Obadia Biraro, had heavily worded statements in his annual report.

In one of his statements Biraro observed that despite the descending trend, public funds and resources management in some public entities are still weak and need improvement.

“Unnecessary, unlawful and wasteful expenditure should be avoided if public entities exercised due care in their operations, coupled with prudent management of public resources,” he said in his report released in May 2021.

For years, the Auditor General’s recommendations have barely been implemented primarily due to inadequate coordination of efforts, according to him.

“This is more so on irregularities that do not fall under the purview of a single public institution,” he says.

Under these circumstances, implementing audit recommendations requires, Biraro insists, “concerted efforts and absolute dedication from the management of government agencies and those entrusted with governance.”

Eighty-one (81) public entities had long outstanding creditors and debtors’ balances up to Frw13 billion and Frw50.5 billion in their financial statements respectively.

These balances have been outstanding without movement for up to 10 years. “Financial statements for these entities are not fairly stated,” the AG noted.

Bank reconciliations for twenty (20) bank accounts with balances totaling Frw254 million had unreconciled differences without explanation.

In addition, bank reconciliations for five (5) bank accounts with balances totaling Frw129.3 million had irregular reconciling items. This is an indication that the reported bank balances were not accurate.

A review of the budget execution report revealed that internally generated revenue and expenditure of Non-Budget Agencies were not included in the national budget approved by parliament.

Disclosures made for NBAs revealed that a total of Frw108 billion of internally generated revenues and expenditure of Frw170 billion were omitted from government expenditure for the year ended at 30 June 2020.

However, the current year audits found 62 cases of delayed contracts worth Frw216 billion in 38 public entities and projects. 

These consist of 50 delayed contracts worth Frw195 billion identified during the year under 12 contracts worth Frw21 billion from previous audits. Delays were up to 2,721 days.

These are just a few picks from the report. In the AG’s view, each oversight body, stakeholders and accountability institutions must play a role and lend total support to resolving this concern.

In response to these recurring challenges, the Ministry of Finance (MINECOFIN) is seeking the help of a qualified consultancy firm to assist in the migration to accrual accounting based on International Public Sector Accounting Standards (IPSAS), under the Public Finance Management Reform Project (RPFMR). The three-year project is funded by the World Bank.

Five international audit firms have been preselected from which one of them shall be awarded the tender to offer the services mentioned.

The firms, Taarifa has learnt, include CCM (Belgian), with a quotation of Rwf2.3 billion, ADP (Kenyan) seeking Rwf1.6 billion, BDO (UK) quoting RwfRwf4.2, KPMG (Anglo-Dutch) with Rwf4.4 billion and PwC (UK) quoting Rwf4.5billion.

These firms, according to our sources, were preselected from a total of nine who had submitted their bids. The scrutiny is now projected on the remaining five.

Scrutiny, however, according to our sources, should have been conducted earlier before a mere shortlisting because of a long list of concerns surrounding these particular firms in question.

The nature of due diligence conducted against the preselected five firms is being questioned due to their previous records working in Rwanda with various public institutions on a number of sensitive and heavy projects.

Taarifa has learnt that there was no in-depth analysis conducted to ascertain the reputation of these firms and specifically three of them that have been operating in Rwanda for the last decade.

Fears have been expressed that even though some of the firms are aiming at the big four, they have a troubling track record with various institutions.

Taarifa has gathered details on each firm.

ADP’s offer is believed to be a low quotation signaling a lack of full knowledge on the scope of work. Sources privy to this tender say the fee quoted by ADP is below expected threshold to execute such an assignment if MINECOFIN goes by the lowest bidder.

CCM is also seen through the same lens as the Kenyan firm, and the only difference is that the Belgian has indeed handled major projects in several fields, and with no known records of contractual failures in Rwanda yet.

The remaining three are in the same range with minor differences in their financial offer with a disparity of Rwf0.3 between the lowest and highest bidder.

BDO is as large as the other two, and operating under a franchise arrangement except that in the bid, BDO UK was the bidder and not BDO Rwanda. 

However, BDO Rwanda, according to sources, might be the one to execute the tender with assistance from BDO UK, if they win. 

BDO Rwanda has had several contractual faults. For example, the firm has not fully completed the contract to rebuild WASAC’s opening balance sheet after it was split from ELECTROGAZ in 2010.    

KPMG is one of the Big Four international accounting organizations, however, KPMG Rwanda is a franchise. They have operated in Rwanda for over a decade. 

Prior to opening their office in Rwanda in 2010, KPMG had already begun working with the government to implement the privatization program and modernizing Rwanda Revenue Authority among other institutions. 

Our sources did not speak well about KPM’s previous assignments. We learned about contracts such as that of RRA to reconcile tax accounts that were meant to be completed in one year, but went on for three years now. 

“We have a historical issue that we are now cleaning up,” a source in RRA told Taarifa. 

“But they are progressing.” KPMG is also accused of failing to complete their contract of separating pension schemes for RSSB, giving the institution a burden to explain itself every year to the Auditor General.

PwC is also among the big four. It was the first among the big four to expand its African network by opening an office in Kigali, Rwanda. PwC had first served Rwanda for a number of years on a fly-in, fly-out basis from neighbouring African countries.

Sources say PwC has had a whirlwind of errands with several institutions for years, including a bad experience with MINECOFIN itself where a five year contract to assist in consolidating public accounts went bad.

An anonymous source in MINECOFIN testified to Taarifa that these institutions are on their watch list for unethical behaviour and antagonising experiences in the market, “unfortunately they are the big ones we have and we don’t regulate them. Go ask the regulator.”

The regulator is the Institute of Certified Public Accountants of Rwanda (iCPAR).

In defence of the firms

The CEO of iCPAR, Amin Miramago, was very categorical when Taarifa sought his comment. He defended the firms.

He said that what’s said about these firms should be looked at in many dimensions with careful considerations.

First, he noted that most of the public institutions these firms serve, have legacy issues that are too complicated. 

“They do this and then do that and you find them in constant situations that are hard to fix,” Miramago said, adding that, “When you implement a reform, you need to give it time to assess the results before you bring in something new.”

He blamed contracting institutions for failing to implement advisory work offered by the firms they contracted. “They are always playing victim cards,” Miramago said. 

That in the event of knowledge that the firms are hiring unqualified staff or subcontracting others for example, as it is said out there, “why give them contracts and cry crocodile tears later? is the negligence of those institutions, it is their responsibility to follow up and see if the contractor is meeting contractual obligations or not, if they aren’t meeting their obligations, they should take actions against them.”

Despite Miramago’s defense, Taarifa has learnt that major firms have another game they play to survive in the market. 

Sources that couldn’t provide tangible evidence for fear of losing their jobs, say the firms offer kickbacks to secure contracts. 

And by doing so, those who take the kickbacks and are responsible for holding the firms accountable, eventually lose the moral authority to hold the firms accountable.

This did not sound well in Miramago’s ears. He revealed to Taarifa a different practice, without refuting the corruption allegations. He said the problem he is aware of in the market is malice.

“I regulate all firms; big, medium and small. The most malicious firms are the big ones because they are in a small market,” Miramago confessed and gave an example of a scenario where a certain firm he didn’t want to mention, backstabbed another and sent the contracting institution into a panic mode so that the contract could be awarded to them.

Nevertheless, the auditing practice, an independent auditor told Taarifa, “has become a commodity…truth be told, they are doing whatever they want in the market because of connections to powerful individuals in government, unfortunately it’s the economy that suffers.”

But Miramago doesn’t buy this argument. He says that’s not something as a regulator he can tolerate, instead, he said, “the firms you mentioned are internationally recognised brands that have a reputation and they add value to our economy especially that we now attract global institutions that will need their services.”

And that’s not what everyone thinks. “The only thing international you have there is the name,” an auditor in one of the four firms confessed.

Whether that is considered during tendering or not, remains known to those who sign contracts in closed doors.

As we await the final announcement this June, may the best bidder win, if not, for Obadia, we could be seen as the Somali camel rotating around the well thinking it is on the move.

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Special Report

Multimillion-dollar Kigali Golf Course Recklessly Destroyed By Harmful Chemicals



Members of Kigali Golf Club (KGC) may have to wait longer before they play any game after a reckless contractor marvelled through the most of the golf course and sprayed it with a harmful chemical.

A large portion of the almost US$11 million course has been burnt and it might take months before it sees life again.

It all began with the supplier ignoring the content of the soil sample that needed specific chemicals and fertiliser pillages. Stock worth over US$70,000 was paid for by the Management of KGC.

Then a contractor responsible for maintaining the course, who also happens to be the one who built the course, went ahead and applied the chemicals without testing the possible effects.

Normally, a test would be conducted on a small portion off the main course to assess the effect before it is applied on the whole course. Now, after negligently spraying the chemicals, the whole multimillion-dollar course is in jeopardy.

It doesn’t not only look yellow, it also is unstable. The management of KGC convened on Tuesday June 9, to figure out how to manage the crisis before the situation backfires.

The contractor’s monthly payment worth US$25,000 has already been signed, but sources told Taarifa that it is temporarily being held by senior management.

The course that has been under construction has not hosted any tournament. It was expected to be officially opened during CHOGM that was slated on 22nd this month. It means if CHOGM was still on, the country would have suffered a historic and unforgivable embarrassment.

In May, Infrastructure Minister, Clever Gatete, who oversees this investment, convined a general meeting with all stakeholders, and requested a status report on the whole investment.

Trusted sources told Taarifa that the team he assigned the task could have flouted his directives. As things appear, he might have been duped into believing all is well or no report was made at all, going by the disturbing evidence of mismanagement and misappropriation of resources and funds that Taarifa obtained from trusted sources.

Meanwhile, for months, Taarifa has been conducting an investigation into allegations of mismanagement of this project worth around US$20 million. A series of special reports will be published in a few days ahead.

How the course looked like before it was sprayed with chemicals and unsuitable fertilisers
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Special Report

Tshisekedi Faces Double Opposition Ahead Of 2023 Elections



The United States Scenario of President Donald Trump failing to win himself a second term in office despite all political pundits putting forward theories in his favour may help scrutinize the ongoing situation in the Democratic Republic of Congo.

President Félix Tshisekedi badly needs a second term in 2023 and the reading on the wall is that this calculative leader is faced with a very sharp and cunningly strong double opposition which unlike in the US may later merge and defeat him.

President Tshisekedi who rose to power through a very suspicious coalition with his predecessor has spent much of his first term maneuvering to gain full control of the country which still has ramifications of Kabila’s 17 year influence.

On December 11, 2020 Joseph Kabila left the capital Kinshasa for Kolwezi (in Lualaba) after suffering a big knockout.

A day earlier, President of the National Assembly Jeanine Mabunda Lioko had been dismissed after a vote organized in the National Assembly. Out of 483 voters, 281 voted in favour of her dismissal, 200 voted against, while a deputy abstained and a void ballot.

Senator-for-life Joseph Kabila couldn’t take in this disappointment; he chose to fly out of the capital to his stronghold in Lualaba for reorganization and strategizing.

As a good strategist, had Kabila already understood that this first crack in the building would inevitably lead to the collapse of his majority?

In a month and a half, the two other dikes that protected the latter will give way. First, with the dismissal of Prime Minister Sylvestre Ilunga Ilunkamba on January 29, 2021, and then, a week later, with the resignation of Senate President Alexis Thambwe Mwamba.

After more than four months in ex-Katanga, the former Congolese president returned to the Congolese capital on April 23 in a costume unheard of for him, that of the opponent.

After the formation of the Sacred Union, President Tshisekedi is no longer confronted with one but two but quite distinct opposing forces, . On the one hand the kabilists, on the other the radical wing of Lamuka, embodied by the Fayulu-Muzito.

The road ahead

The First term of Tshisekedi rule is enough for every voter to make a decision on whether to return him or choose from other candidates. At the Moment, the candidates for the 2023 presidential elections are not yet known except the incumbent.

However, considering Kabila’s previous remarks in the press, there are signs that he may weigh in and return to the political ring and seek a return. Plus his underground manouvers, foreign trips and meetings at his ranch home all point to high interest in the highest office.

DRC’s constitution requires a president to leave office after two consecutive terms, but there is no provision that bars him from seeking a third term later.

In 2018, Kabila said, “Why don’t we wait for 2023 … to envision anything? In life as in politics, I don’t rule out anything.”

“Do we have regrets? No, not at all. We have many accomplishments. The biggest is that we managed… to reunify this country and put it back on the right track,” he said, adding, “There is still a long journey ahead and there are still other chapters that will be written before we can write the history books.”

With such a statement made almost four years ago, and considering his recent political maneuvers, it is inevitable that Kabila will be on the ballot unless some aggressive changes are made within the remaining time.

 What Would Influence Voters In 2023?

Security in East, economic stability, Covid-19 pandemic, Ebola pandemic, social cohesiveness and diplomacy are the top issues that will influence voters and also the same will be used to compare the Kabila and Tshisekedi regimes.

The moment Tshisekedi took over as president, the guns in the Eastern part of the country kept blazing more than before, there were signs and belief that the new leader would bring an end to the insurgency which Kabila was accused of probably failing to remove or simply not caring.

However, with Tshisekedi in control, there is now a clear proof that the armed groups are actually strong and a big threat to the great lakes region.

For voters in Eastern DRC, the incumbent may lose the ballot considering the way he has handled the situation.

Ethnic violence has significantly increased while the Ugandan Allied Democratic Front Islamist rebels have intensified their attacks.

This may be used to compare how Kabila handled the security situation in this part of the country and for the first time will push voters to pick the best war president since they need one that can take on these foreign armed groups.

Under Kabila’s regime, the Ebola pandemic was a highly feared disease. His government mobilized both local and global support and the virus was contained within the country’s territory and this significantly gave Kabila high rating.

For Tshisekedi, the Covid-19 pandemic not as deadly as Ebola will be used to measure his performance on handling a health crisis. Currently DRC has recorded over 800 deaths from 33,202 infected cases in a period of one year.

The incumbent has also scored very well in the economic front where there is a significant attraction of foreign investors, more public private partnerships, revival of defunct industries and infrastructure. However, voters may not have the keen eye to scan through these areas for proper comparison.

 Tshisekedi has a signature of a leader that openly fights corruption although most targeted are senior allies to his predecessor and this depends on how his government presents it to the voters otherwise it may be counteracted as a witchhunt with the aim of gaining control and scoring political points.

Diplomatically, the two men have an equal rating, as Kabila is perceived as a positive leader across the regions surrounding DRC.

Tshisekedi also strikes the region as a corporate person always willing to collaborate with neighbours; he has visited countries in the region and also received many leaders within the region.

Coupled with all these factors, President Tshisekedi will have to play his game very carefully and well because an inevitable coalition between a cunning Kabila and Lamuka the radical wing has an upper hand in the 2023 polls.

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Special Report

Battle Of Energy Investors Exposes Loopholes In RDB



It is not the first time that foreign investors grab each other’s necks on Rwandan territory in an attempt to settle various forms of commercial disputes.

In the latest developments, Dr. Jacques Ntogue, a Franco-Cameroonian entrepreneur, is entangled in a very sensitive corporate dispute against a Mauritanian firm, Omnicane, the later is accused of conniving or manipulating Rwanda Development Board (RDB) to mysteriously aquire his shares in a locally registered  company.

Ntogue told Taarifa in an exclusive interview that he chose to invest in Rwanda to build an international start up in Renewable Energy and also expand across Africa.

The Franco-Cameroonian entrepreneur was bringing to Rwanda rich experience from Management positions in different companies (Orange in France, BT in UK, Siemens in Germany and African Development Bank in Tunisia).

“I stated with Rwanda because I wanted to leverage my experience and contacts when I was working as Head of Division of Telecom, Infrastructure and User Support within Afdb,” Ntogue said.

He established REFAD Rwanda Limited to embark on a long-term investment journey in this part of the world.

Former Rwanda Energy Minister Eng. Albert Butare was very instrumental in giving Ntogue a soft landing in a country that was so hungry for investments especially in the energy sector to fix the deficit.

“When I created REFAD, I was the MD and had 63% shares and offered 7 % to a local engineer Kris Gahiga ( he did no inject a single euro, this was just an incentive mechanism) and 30% to Jerry Okoko, a US/Kenya Citizen I met in Rwanda with the former Minister, Albert Butare,” he says.

According to Ntogue, after obtaining all necessary company incorporation paperwork, he kicked off by conducting a feasibility study, environmental study ( ESIA), securing the land and the river, PPA (Power Purchase Agreement) and had the Sovereign Guaranty approved by the government of Rwanda.

“Of course most of these expenses were paid from my pocket,” he said, adding that all this took five years to achieve. And at this point most of the difficult work for such projects was completed. The next phase was simply to obtain a funder to inject in cash to begin construction.

Ntogue was introduced to Omnicane by an Insead Alumni, partner of Omnicane at that time. Omnicane was looking for a partner in Africa with a viable Energy project. Omnicane did not want to pay someone to explore Africa and develop projects.

“Given that I worked for 5 years without a salary and financed almost everything to secure the above milestones, Omnicane evaluated this work to  €3 million. One should know that in infrastructure projects, all the risk are at the beginning. In fact when you have already signed all contracts there is no development risk anymore,” he said.

In this deal the terms included; evaluation of €3 million, Omnicane was to inject into REFAD RWANDA Ltd €3.1 million in exchange of 51% of the REFAD RWANDA shares. REFAD Rwanda was to  seek for a loan of €8 million to complete the construction.

Meanwhile, the total construction of the power plant  was to cost ( 3.1 +8) = €11.1 million. And in this deal if the construction cost less than €12 million, Ntogue would get €1 million as a success bonus.

According to documents seen by Taarifa Investigative desk, before Omnicane came onboard, the three owners of REFAD RWANDA transferred their shares in REFAD GROUP AG ( RGAG), a mother company in Switzerland. 

“This incidentally means that RGAG became a holder of  100 % shares of REFAD Rwanda Ltd. “When I started REFAD GROUP AG I had 70% shares, Jerry Okoko 28% and Urs Sieffer 2%,” Ntogue explains.

In a nutshell, Ntogue had raised to 72% shares, Jerry Okoko 23 and Kris 5%.

“I bought back Urs Sieffer’s shares a year ago.  Urs Sieffert was the president since the Swiss law requires a Swiss resident to be President and member of the board,” says Ntogue.

Dr. Jacques Ntogue, President and Founder of REFAD GROUP AG.

Dispute Emerges

Ever since Omnicane acquired a 51% stake in REFAD Rwanda, they have never included Ntogue as founder and majority shareholder of REFAD Rwanda and Refad Group AG.

“I asked several times to have the Financial data but they have refused to disclose the information. RDB asked them to disclose this basic data and they refused,” a frustrated Ntogue told Taarifa.

In August 2019, another investor, requested to buy 49% for €3.5 millions. Finnergreen Managing Director went to Mauritius to meet Omnicane CEO. 

Omnicane said that they have the pre-emption rights,  but they refused to pay.

Since the project was up and running since December 2018, Ntogue is wondering how in 2019 there was a capital increase? To do what?  To acquired what new project?

“In December 2019 I was informed by Africa Intelligence that  Omnicane has changed REFAD Rwanda Capital structure so that now REFAD GROUP AG has only less than 2% of the shares,” Ntogue noted with concern.

Ominicane did so by creating new shares on paper without informing the 49% owner of the company, no shareholder meeting was held and also there are no minutes and no resolutions.

Since then Ominicane started sucking money from the company in Rwanda to Mauritius. This is pure tax evasion since all the benefit will go to Mauritius and nothing is left in Rwanda because  REFAD Rwanda will never make a profit. RDB was informed of that.

Few months ago, Omnicane wanted the Cameroonian to validate the 2019 financial account. “We rejected them, since not only we were not involved in the decision (Capital Increase, Omnicane loan) but we would like Omnicane to implement RDB recommendation first,” he insists.

Did RDB facilitate the fraud?

“What is strange is that RDB validated this change without checking the document nor informing us,” the Cameroonian entrepreneur said.

He added, “How can a shareholder of 49% accept to be reduced at 2%??  RDB changed its mind when we started complaining with all evidence. Then RDB released a letter and gave Omnicane only one month to return to the previous capital structure. RDB has sent two letters to Omnicane. Omnicane ignored the instructions.

RDB has the power and rights to make the change themselves but it is not known why RDB is not effecting the change.

Meanwhile, Omnicane went on and changed the company name from REFAD RWANDA Ltd to OMNYHYDRO- which according to Ntogue is in itself an act of theft; “They are taking away all my hard work and brand name I am building.”

Efforts by Taarifa to reach Clare Akamanzi RDB’s Chief Executive Officer for comment on this dispute have been fruitless as she didn’t respond to our questions.

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