draining development.pdf - Khazar University

440 Draining Development?businessmen is a pattern that appears all too often in emerging markets,to the huge detriment of the countries concerned.Attempts to bring the perpetrators to justiceWhen the Kenya Anti-Corruption Commission (KACC) investigatedthese matters, it was clear that all the contracts had been mastermindedby the two groups. 21The full extent of the scam only became gradually apparent to JohnGithongo, Kibaki’s newly appointed secretary for governance and ethics,who called on the government to cancel the contracts when it becameclear to him what had been happening. Githongo’s attempts to exposethe affair led directly to harassment, which included death threats andvarious attempts at blackmail; as a result, he fled the country and soughtasylum in the United Kingdom. 22 Already, large sums of money had beenpaid out, but this did not stop at least three of the contractors from initiatingproceedings in Europe to claim the unpaid balances on theircontracts.One of these sets of proceedings was undertaken in Switzerland. 23 Inan endeavor to gather evidence from Switzerland, the KACC issued lettersof request for mutual legal assistance. Acting on one of these requests,the Swiss authorities raided the premises of a shell company used by theplaintiffs. Papers and records were removed. Within 48 hours, proceedingswere issued by that company in Nairobi seeking orders of certiorariand prohibition in respect of Kenya’s 2003 Anti-Corruption and EconomicCrimes Act. 24It was claimed that the KACC had no power to issue letters of requestto a foreign government. The case came up for trial, and the judge at firstinstance upheld the claims that KACC had, in effect, acted unconstitutionally,despite the fact that express power was given to the KACC torequest from and to give mutual legal assistance to foreign governmentsin the statute under which it was incorporated. 25The effect of this decision was interpreted by Kenya’s attorney generalto mean that the KACC could not either give or receive mutual legalassistance until the court decision had been appealed and overturned oruntil new legislation, which was before Parliament, had been passed.As a direct result, the Serious Fraud Office in England issued a pressrelease at the beginning of February 2009 in which it stated that it was