Are the Goodyear bribes in Kenya, as disclosed in US Foreign Corrupt Practices Act case, disappearing into Kenya’s “black hole” of impunity?


tyres in Lamu

Tyres in Lamu


From Nairobi’s Business Daily of February 26, 2015, “Big names face scrutiny in Goodyear bribes scandal“:

Top Kenya government officials are on the spot once again for pocketing more than Sh138 million ($1.5 million) in bribes from a subsidiary of American tyre firm Goodyear Tire & Rubber Company, US regulators said.

The bribes were paid in exchange for the award of multi-million shilling tenders to supply tyres to some of Kenya’s largest state corporations, government agencies and public listed firms.

The US Securities & Exchange Commission (SEC) said Goodyear paid the bribes to Kenya Ports Authority (KPA), Armed Forces Canteen Organization (Afco), Nzoia Sugar, Kenyan Air Force, Ministry of Roads, Ministry of State for Defence, East African Portland Cement Company (EAPCC) and Telkom Kenya executives to win contracts.

US detectives also established that additional Sh1.3 million ($14,457) was dished out to lure Kenya Police and City Hall officials to award the Ohio-based tyre maker multi-million shilling deals.

The corrupt dealings, committed between 2007 and December 2011, were executed through Treadsetters Tyres Ltd, then a subsidiary of Goodyear.

Goodyear made the illicit payments to Kenyan officials in cash and recorded the spending in its financial books as advertising expenses, according to a forensic audit by the SEC.

“Treadsetters’ general manager and finance director were at the centre of the scheme,” the SEC said in its filings. “They approved payments for phony promotional products, and then directed the finance assistant to write-out the checks to cash.”

The well-orchestrated bribery ring involving Kenyan bureaucrats is captured in a ruling in which Goodyear has agreed to pay a Sh1.48 billion ($16.22 million) fine for engaging in corrupt practices abroad.

The allegations were disclosed by Goodyear in 2012 and hit the Kenyan press in a significant way when the SEC fine was announced almost eight months ago.  Many of the disclosed bribes were paid to Kenyan national security officials.  In the meantime, we see more successful terrorist attacks and insecurity, but no further news on anything being done to suggest that the Government of Kenya has any substantive intention of treating these bribes as unacceptable.

Where is Kenya’s Ethics and Anti-Corruption Commission? Where are Kenya’s journalists and media houses in following the stories they reported? (would be pleased to hear if I’m missing something . . .)

And where is my government?  I’m proud of my country for policing our own companies through the Foreign Corrupt Practices Act, but it has been sad to see our support for a “reform agenda” in our relations with Kenya seem to run off into a ditch.

“Faded Aid”

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