Kenya’s Finance Minister arrested on corruption charges

Kenya's Finance Minister Henry Rotich and other treasury officials were arrested on Monday on suspicion of corruption and fraud related to a multi-million dollar project to build two mega dams, police said.

Rotich and his co-accused face eight charges, ranging from conspiring to defraud and financial misconduct, Noordin Haji, the director of public prosecutions, said. The minister and other officials will have to resign immediately, he said.

Rotich was arrested shortly after the charges were announced.

Haji said the conception, procurement and payment processes for the dam project -- part of a bid to improve water supply in the drought-prone country -- was "riddled with irregularities".

"Investigations established that government officials flouted all procurement rules and abused their oath of office to ensure the scheme went through," said Haji.

He pointed to the awarding of the contract to Italian firm CMC di Ravenna in a manner that he said flouted proper procurement procedures, and despite financial woes that forced the company into liquidation and had led to it failing complete three other mega-dam projects.

The two dams were budgeted to cost 46 billion shillings ($446 million), Haji said, but the treasury borrowed far more.

Some $180 million has already been paid out, with little construction to show for it.

Another $6 million was paid out for the resettlement of people living in areas that would be affected by the project, but there is no evidence of land being acquired for this, the chief prosecutor said.

"I am satisfied that economic crimes were committed and I have therefore approved their arrests and prosecutions," said Haji.