Kenyan Tycoon Stanley Livondo Embroiled in Sh2.7 Billion Zambian Military Contract Scandal

A company linked to Nairobi businessman Stanley Livondo has become embroiled in a controversy over alleged kickbacks related to a substantial military hospital upgrade contract.

The controversy centres around a $21 million tender awarded by Zambia's army and Ministry of Defence to upgrade a military hospital in Lusaka. Concerns have been raised about a $5.3 million payment made to DLS International in 2023, with allegations suggesting that a portion of these funds was subsequently transferred to personal accounts of Zambian business owners and Army officials. The ACC's investigation extends beyond the alleged kickbacks, questioning how a newly established company without relevant experience in construction or security contracts managed to secure such a significant government deal.

The Financial Reporting Centre (FRC) in Nairobi initially flagged the August 10, 2023 cash transfer, prompting inquiries into the purpose of the payment. In response to these allegations, DLS International has asserted that it held a legitimate contract with the Zambian Ministry of Defence for hospital-related services. However, the company's recent incorporation in February 2023, just months before receiving the contract payment, has fueled scepticism. Stanley Livondo, the majority shareholder of DLS International, has publicly dismissed the corruption and money laundering allegations as unfounded.

Despite the controversy surrounding the contract's timing, Livondo maintains that his firm fully delivered on its commitments. The investigation has revealed potential irregularities in the contract's execution, including the absence of a required bank guarantee or insurance bond from DLS International Group. Furthermore, the ACC has engaged Kenyan anti-corruption authorities to assist with the investigation and potential prosecution of those involved. Adding another layer to the situation, the Zambian government has recently refuted claims made by the Financial Intelligence Center (FIC) regarding the procurement and delivery of medical equipment for a UN-level field hospital.

Government officials, accompanied by DLS representatives, conducted a tour of the hospital to address these allegations, asserting that all equipment had been successfully delivered despite the contractor receiving only a fraction of the owed payment.