Sh1.9 billion for army combat gear goes missing

A company has written to the Ministry of Defence (Mod) demanding payment of Sh1.9 billion for the supply of groundsheet ponchos used by soldiers for tactical survival.

Aero Handling EA Ltd wrote to Permanent Secretary Patrick Mariru seeking payment of Sh1,957,597,000 that has been pending for the past six years. 

It claims that top officials at MoD and National Treasury have failed to explain where the money went to after it was released to pay for the delivery of goods in 2019. 

Groundsheet ponchos are waterproof sheets that soldiers wear and lie on.

Through Wachira and Mumbi Advocates, the company said that despite Treasury releasing the funds, the same is yet to be deposited into their bank account. 

The firm’s said that they fully discharged its contractual obligations by importing and delivering the specified goods to the Ministry of Defence in 2019 under Bill of Lading No. 142,951,743,467, which goods were duly cleared and received by the Ministry. 

He said despite the Ministry’s receipt and utilisation of the supplies, payment has remained outstanding for over six years. 

“Our client informs us that in February and March 2024, the National Treasury released the full sum of Sh1,957,597,000 to the Ministry of Defence to clear this pending bill,” said Kimani Wachira. 

In the letter, Wachira noted that the firm was awarded Tender No: MOD/423 (07057) 2016/2017 for the supply of ground sheets (poncho) on September, 13 2017, an agreement that was later regularised by the supplementary contract (Ref: MOD 09/ISA/VOL.LXIV/255) dated May, 9 2019. 

“Accordingly, our instructions are to demand from you, as we hereby do, the immediate remittance of the principal sum to our client’s designated account within seven days from your date of receipt hereof,” said Wachira. 

“Take further notice that should you fail to comply with the above demand strictly within the stipulated period, we hold firm instructions to commence legal proceedings against the Ministry of Defence for the recovery of the debt plus interest and costs,” he continued. 

In a letter dated May 23 2019, MoD acknowledged receipt of the said supplementary contract agreement signed by W A Kituyi No: MOD/423(07057)2016/2017. 

“Reference is made to the above tender in which you participated and was successful. Forwarded herewith please find one original contract agreement,” read the letter from MoD to Aero Handling EA Ltd. 

In a complaint letter dated June 16, 2025, addressed to the Ethics and Anti-Corruption Commission and the Auditor-General, the firm’s director, Tom Awili, said the National Treasury procured and released the funds to the MoD Principal Secretary to pay the pending bill sometime in February and March 2024.

“After the due process and approval of this pending bill request, which included processing through the offices of the Attorney-General, Auditor-General and the Controller of Budget among others, Treasury was able to subsequently release the funds to the Ministry of Defence to pay this pending bill in February and March 2024,” read the letter to EACC. 

Awili said the Kenya Army Headquarters, Defence Forces Ordinance Depot (DEFOD), The Office of the Chief of Defence Forces and the office of Principal Secretary MOD are well aware of the said tender. 

He said after the release of the funds, they proceeded to make constant follow-up thorough the Office of Principal Secretary MOD, Chief Finance Officer, Head of Accounting Unit MOD and the Assistant Chief of Defence Forces Personnel and Logistics for Their pending bill payment to be released to them which was unsuccessful. 

Further, Awili also confirmed that on receipt of the AIE and Exchequer to pay the pending bill from Treasury sometimes in February/March 2024, the PS MOD instructed the head of accounting unit to process the payment to be released to the firm commercial bank account held in Paramount Bank. 

“However, despite these instructions having being released by PS MOD and head of accounting unit to Central Bank of Kenya (CBK), the firm has never received payment to date, raising serious queries as to what could have transpired when the instructions to release the funds were received at CBK,” said Awili.