Court case exposes fraud in KDF medical scheme

June 2020 theStar: A court case has exposed systemic loopholes in the Defence Forces Medical Insurance Scheme (Defmis), resulting in some cases of fraud.

Some payments made to accredited service providers were made on the basis of forged documents, court paper say.

A number of retired military officers in the scheme confirmed payments were made to health facilities under their names even though they did not seek medical attention.

Others who had who only sought outpatient care were claimed to have been admitted. If they had been admitted, the number of days was sometimes increased.

In an appeal ruling delivered last week, High Court justice Luka Kimaru acquitted an officer convicted of swindling money from the scheme.

Kimaru said Laban Agak Nyambok, a member of the Kenya Defence Forces, was used as a scapegoat for others in the management chain at Defmis.

Nyambok was posted to Defmis in January 2013 when he worked as a medical verification officer until April 2015 when he was arrested by military police. He remained under arrest for 73 days before he was arraigned before a court martial.

He was charged with four counts of conduct to the prejudice of good order and service discipline. The charge sheet said Nyambok received the sums of ShSh370,000 on diverse dates between April 2013 and 2014, from Anthony Mbithi, the proprietor of Tahidi Nursing Home in Mwingi for clearing fictitious hospital bills amounting to Sh748,646.

He was also charged with approving payment for inpatient hospitalisation of Naomi Mwalale and Abdinassir Jama at Tahidi Nursing Home and Ewaso Medical Services and Nursing Home, respectively, without admission authorisation,

He denied the charges but the court martial found him guilty, sentencing him to one year’s imprisonment.

The KDF officer appealed the decision stating that crucial witnesses were not called.

The prosecution argued that Nyanbok was tasked with authorising inpatient and outpatient treatment at approved medical establishments and was the liaison person between Defmis and the service providers.

“He authorised payments of claims which were not genuine. It was his duty to ascertain and verify medical claims, and where appropriate weed out any fictitious medical claims presented to Defmis,” the prosecution said.

The lawyer said complainants did not seek or get any treatment from the medical facilities and kickbacks were paid to Nyambok through his bank accounts days after Defmis settled claims of the stated service providers.

He asserted Nyambok received Sh370, 000 from Mbithi paid to his Kenya Commercial Bank, Flamingo Branch account, and Sh320,000 made by Ewaso Medical Services to his account.

The prosecution did not produce witnesses for the cited heath facilities to support its assertion.

Nyambok said he received the funds on behalf of the managing director of Defmis, Brigadier R.A Onyango (now retired), which he withdrew and gave him.

He testified that the managing director requested to use his bank account and that was the reason funds were deposited in his account.

“I withdrew and forwarded the funds to the Managing Director. I showed the investigating officer my M-Pesa transactions indicating the same. Do not have any dealing with Mbithi,” he said.

The investigating officer confirmed the claims and admitted he was not aware who – the Managing Director or the appellant –  gave authority for admission regarding the medical claims that were flagged.

“It was clear this was to a large extent due to deference to the military chain of command. The investigator in this case being a junior officer could not investigate officers who are senior to him. This led to his curious and peculiar decision to pursue Nyambok who was of a similar rank to him,” Kimaru ruled.

“There was a gap in the investigations which could only have been filled if the entire management chain of Defmis recorded statements to confirm or deny the assertion made by the Appellant that he was working under instructions of his seniors when he performed his duties.”

Justice Kimaru said many persons within the chain of management could give authorisation for the treatment of a member. The senior management of Defmis could even overrule objections by junior members of management and direct payments be made for treatment of members.

“These systemic failures may have been exploited by service providers to make fictitious claims. Payments could be authorised without documents to support the claim that the particular member was treated,” he said.

He acquitted Nyambok stating that he “just happened to be one of the members of an imperfect and easily manipulatable system and cannot be solely held accountable for systemic failures at Defmis.”

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