Jinxed: CBK governor post which has caused past holders untold grief
Prof Njuguna Ndung’u, Dr Patrick Njoroge’s predecessor at the Central Bank of Kenya, served two terms, but on the strength of court orders. PHOTO | FILE
What you need to know:
The appointment to the office not only gives the holder unbridled direction of monetary policy, but it also bestow upon him a say at global multilateral institutions like the International Monetary Fund and the World Bank.
But the position has caused holders untold grief since the mid-eighties with all four of Dr Patrick Njoroge’s predecessors leaving under a cloud of controversy.
The position of Central Bank of Kenya governor is gaining notoriety for being somewhat of a poisoned chalice.
The appointment to the office not only gives the holder unbridled direction of monetary policy, but it also bestow upon him a say at global multilateral institutions like the International Monetary Fund and the World Bank.
But the position has caused holders untold grief since the mid-eighties with all four of Dr Patrick Njoroge’s predecessors leaving under a cloud of controversy.
Eric Kotut was bundled out after rogue oversight over commercial banks yielded inflation rates above 40 per cent for the first time in Kenya’s history in the wake of the Goldenberg scandal.
Reformist Micah Cheserem came in but became a pawn in vicious political battles and was replaced by Nahashon Nyagah, who was hounded out amid questions of complicity in the Eurobank excesses before Andrew Mullei’s tenure was cut short by his zeal in closing down Charterhouse Bank.
Mr Mullei’s deputy Jacinta Mwatela was blocked by political forces from succeeding him and while his eventual successor Prof Njuguna Ndung’u served two terms, it was on the strength of court orders.
Prof Ndung’u, who left in March 2015, survived parliamentary censure in 2012 after MPs voted to delete his name from a committee report that investigated the rapid decline of the shilling. Even though he completed his term, Prof Ndung’u constantly fought off arrest warrants over a controversial currency printing tender.
At one point, Director of Public Prosecution Keriako Tobiko directed that Prof Ndung’u be prosecuted for irregularly awarding a $12 million tender to install a modern security system at CBK.
His predecessor Dr Andrew Mullei was sacked over abuse of office after he appointed, without following due process, a Melville Smith, a forensic auditor, Terry Ryan, a member of CBK’s monetary policy committee, his son Sila Mullei, a computer expert, and Titus Mwirigi to investigate alleged tax evasion and money laundering at Charterhouse. Dr Mullei had to battle in court to clear his name, albeit too late to save his job since his replacement had been appointed already.
The collapse of Eurobank in March 2003 and the politics that came with it claimed Dr Nyagah’s career. Dr Nyagah caved in to public pressure and resigned over Eurobank, which had sunk with $14 million of depositors funds.
But it is the current chairman of the Commission for Revenue Allocation Micah Cheserem, who was dismissed from the CBK governorship position in 2001, who with a local daily captured the mood of the office in an interview. He said the CBK governor position is not jinxed, but the political interests are the driving force behind the woes the governors face.
