Troubled national carrier Kenya Airways says it will institute criminal and civil charges against individuals involved in the scam that threw it into a tailspin.
KQ chairman Dennis Awori Thursday said in a paid advertisement that the company had instituted investigations into audit queries raised by Deloitte Consulting Ltd, indicating the airline had lost over Sh60 billion in four years.
The audit report extensively covered by The Standard showed KQ lost Sh61.1 billion after seven million tickets were issued below seat cost between 2012 and 2015.
The company also lost Sh2.2 billion in six months in an orchestrated scheme of incorrect billing and allowance of excess baggage. “In the course of the investigations, cases of fraudulent activity have come to light that could have caused losses to the airline over a period of time,” Mr Awori said.
He said the board had considered and taken necessary action including strengthening of controls and processes, disciplinary action, sacking of staff found culpable and launching further investigations which may lead to criminal and civil prosecution in some instances.
Deloitte found out that the airline was bleeding from ticketing fraud, with the top 10 travel agents accounting for Sh3 billion of the losses, some of whom were inflating prices for tickets sold to corporate entities, creating the general consensus in the market that KQ is an expensive airline.
The company’s staff also had a hand in the jar where those with access to the Amadeus System would re-open closed fares and enable over-booking of tickets in lower fares. They would also change, cancel, refund and reissue tickets.
Siphoning revenues from cargo was choreographed in at least 16 KQ stations across the globe, attributable to possible collusion, fraud, corruption and negligence by the airline’s management.
“Considering the sensitivity of the potential prosecutions, and the attendant criminal liability as may be established, the board cannot at this point give specifics of persons and amounts involved as this may jeopardize the case files under preparation,” Mr Awori said.