Office of the Inspector General

Investigation into Global Fund Grants in Kenya

05 December 2022

The National AIDS and STIs Control Programme of Kenya (NASCOP) is a Sub-Recipient under Global Fund grant KEN-H-TNT for which the Principal Recipient is the National Treasury of the Republic of Kenya. The Office of the Inspector General of the Global Fund (OIG) found that staff at NASCOP engaged in fraudulent and collusive practices during the hotel selection process for program activities. In a separate instance, staff at NASCOP manipulated payment records to fraudulently pay third parties that did not deliver any goods or services.

The former NASCOP procurement officer systematically fabricated quotations from different hotels, colluded with hotels to receive fictitious quotations, and edited hotel quotations to falsely simulate competitive procurement processes. Due to the inadequate segregation of duties, the former procurement officer was able to manipulate multiple procurement processes without being detected.

Separately, the former NASCOP accountant falsified payment records to fraudulently pay third parties disguised as printing vendors without delivering any services. Non-transparent bank statements at NASCOP hampered and delayed the daily validation and reconciliation of individual payments to beneficiaries.

The systematic nature of the misconduct concerning hotel procurements at NASCOP rendered the entire amount of hotel expenses, US$1.4 million, vulnerable to fraud. The OIG found that lack of segregated duties, a weak financial management system, and non-transparent banking records at NASCOP created an enabling environment for prohibited practices.

The OIG recommends the Secretariat pursue from the Principal Recipient an appropriate recoverable amount from the grant’s hotel expenses including the loss of US$46,940 identified in this report. This amount comprises the overpricing in the hotels NASCOP hired, as well as double payments made to a printing vendor.

In response to the OIG’s Letter of Findings, NASCOP has acknowledged the fraudulent practices and weak internal controls described in this report. NASCOP has committed to making improvements.

  • Global Fund Grants in Kenya (GF-OIG-22-019 - 5 December 2022)
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