A Swiss multinational security printer which provides excise duty stamps to KRA has been ordered to pay Sh12.4 billion over alleged involvement in corruption.
The order was issued by the Office of the Attorney General of Switzerland on Saturday over corporate criminal liability in connection with acts of corruption perpetuated by SICPA.
"The OAG has accordingly ordered the company to pay a fine of CHF 1 million (Sh153,564,265.70) and imposed an equivalent claim for compensation amounting to CHF 80 million (Sh12.4 billion) under Art. 71 para. 1 SCC," a statement from OAG reads in part.
The directive came after the office identified organisational deficiencies that made it possible for SICPA employees to bribe public officials in the conduct of business in Brazil, Colombia and Venezuela.
"Organisational deficiencies were particularly evident in the areas of corporate governance, risk management and compliance," OAG said in the statement.
Further, the OAG handed a conditional prison sentence of 170 days to the former sales manager of SICPA for bribery of foreign public officials.
He is said to have paid bribes to high-ranking officials in the Colombian and Venezuelan markets between 2009 and 2011.
The statement added that the proceedings against the CEO and major shareholder of SICPA are being discontinued because suspicions justifying an indictment have not been corroborated.
SICPA found itself in the center of controversy over its award of a tender to supply excise duty stamps after National Assembly Minority Leader Opiyo Wandayi raised questions.
Wandayi in January questioned the plan to renew a five-year contract between KRA and the Swiss firm, describing the deal as "a well-articulated scheme to steal from the unsuspecting public."
Wandayi also wondered why the government had hiked the cost of excise duty stamps, saying the increase would cost taxpayers Sh162 billion in five years.
"The proposed increase in the excise stamps cost raises a number of concerns including ownership of the Excisable Goods Management System. Based on the previous contract that put its proceeds at Sh81 billion in 5 years, these new costs will translate to Sh162 billion in 5 years," he said.
"This cost will be borne by taxpayers since the cost will be passed on by manufacturers. The question is, why is the Kenya Kwanza government abetting this and increasing the cost of goods for the poor 'hustlers' that they promised to give a lower cost of living?" Wandayi posed.
In a press address in March, National Assembly Finance and National Planning Committee chair Kuria Kimani said the committee is investigating the KRA-SICPA contract to establish the facts.