The Directorate of Criminal Investigations (DCI) has been directed to launch investigations into a suspected Sh6.2 billion payroll fraud uncovered in government institutions, following an audit that exposed widespread irregularities in the public wage bill.
The directive was issued on Tuesday, June 30, during a Cabinet meeting chaired by President William Ruto at State House, Nairobi, where ministers approved a raft of reforms aimed at eliminating long-standing payroll fraud and strengthening accountability in the management of public funds.
According to a Cabinet dispatch, the DCI will investigate the suspected fraud, verify personnel numbers used in payroll processing, dismantle criminal networks believed to be manipulating government payroll systems, recover lost public funds and ensure those found responsible are arrested and prosecuted.
“Cabinet directed the Directorate of Criminal Investigations to investigate payroll fraud, verify personnel numbers used in payroll processing, dismantle criminal networks manipulating Government payroll systems, recover lost public funds, and ensure the immediate arrest and prosecution of all persons found culpable,” the dispatch read in part.
The investigations follow a payroll audit which found suspected irregularities worth Sh6.2 billion in 12 of the country’s 53 State departments.
“A sample audit of 12 of the 53 State Departments revealed suspected payroll irregularities amounting to Sh6.2 billion, exposing unauthorised alterations to payroll records, irregular payments, weak controls over statutory deductions, and fragmented payroll management and major oversight gaps,” the dispatch added.
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The audit uncovered unauthorised changes to payroll records, irregular salary payments, weak controls over statutory deductions and significant weaknesses in payroll management, raising concerns over the integrity of the government’s payroll system.
To establish the full extent of the suspected fraud, Cabinet approved a government-wide payroll audit covering all remaining ministries, departments, agencies and State corporations.
The Cabinet also approved a comprehensive payroll reform programme to tighten oversight across the public service. The measures include a government-wide audit of all remaining State departments and public institutions, as well as the migration of ministries, departments, agencies and State corporations to a revamped Integrated Human Resource and Payroll System (IHRPS) with enhanced cybersecurity and stronger payroll controls.
The reforms are intended to curb payroll fraud, strengthen accountability in the management of public funds and safeguard taxpayers’ money. Meanwhile, attention now shifts to the DCI, which is expected to investigate the alleged payroll manipulation, recover any lost public funds and prosecute those found culpable.
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