World Bank sanctions e-Citizen founder over fraudulent Somalia deal

eCitizen Founder James Ayugi and his firm Webmasters Kenya Ltd have been sanctioned by the  World Bank over fraudulent practices in a tendering process involving Sh12.7 million.

Communication from the multinational lender show Ayugi and his firm have been blacklisted from participating in any World Bank financed projects for five years.

The notice dated June 8, 2026, details the intrigues behind the blacklisting, which involved a project in Somalia.

It is said that Ayugi and his firm, while tendering for the project, presented two key experts and their certifications, as part of the team that will be implementing.

However, the board found out that Ayugi misrepresented the availability of the experts in order to win the contracts. More so, Ayugi and his firm used the experts’ curriculum vitae when bidding without their authorisation.

“Pursuant to Sanctions Board Decision No. 147 issued in Sanctions Case No. 790, the Sanctions Board imposes a sanction of debarment with conditional release for a minimum period of five years on both the firm Webmasters Kenya Ltd., and the individual Mr. James Ayugi (together, the “Respondents”),” reads the notice from the bank’s Sanctions Board.

It adds: “ These sanctions are imposed on the Respondents for fraudulent and obstructive practices as defined in paragraphs 1.23(a)(ii) and 1.23(a)(v) of the World Bank’s Guidelines: Selection and Employment of Consultants under IBRD Loans and IDA Credits & Grants by World Bank Borrowers, dated January 2011 (the “January 2011 Consultant Guidelines”).”

The World Bank says the respondents were found liable for fraudulent and obstructive practices.

“Specifically, the Respondents misrepresented the availability of two key experts for a contract under a Word Bank Group-financed Project,” it says. “The Respondents also materially impeded the exercise of the Bank’s inspection and audit rights by failing to meaningfully comply with the Bank’s documentary requests in the context of an audit.”

The contract in question was for the Scaled-Up Project that aims to support progress towards increased access to basic digital financial and government services targeting entrepreneurship and employment, particularly for women.

The Project was initially being implemented by the Somalia Ministry of Finance, and later by the Somalia Ministry of Commerce and Industry, sometimes interchangeably.

The Project became effective on August 8, 2019, and was scheduled to close on June 30, 2026.

The Sanctions Board avers that during submission of the proposals on July 25 and August 6, 2020, Ayugi submitted the financial and technical proposals for the Scaled-Up project, which identified key staff members.

The financial proposal set out the proposed remuneration for each key staff member.

The technical proposal included the key staff members’ curricula vitae (CVs) and identical template certifications intended to confirm each individual’s availability for the assignment, stating: “I am available to undertake the assignment in case of an award.”

He gave a confirmation of the expert’s availability during contract negotiations and also signing.

“The meeting minutes reflect that the Scaled-Up PIU requested the respondent individual to “confirm the availability of all experts in the team for their respective assignments,” and that he confirmed the availability of the key staff,” World Bank says.

And during contract signing, the said CVs and remuneration package were included, confirming their availability.

The World Bank has interpreted this as a structured ploy to swindle the lender of Sh12.7 million.

“Integrity Vice President (INT) further submits that the misrepresentations served to mislead the Scaled-Up PIU and the Bank to improperly claim a financial benefit totaling Sh12.7 million (USD 98,000), corresponding to the remuneration allocated to the Key Staff Members under the Scaled-Up Contract,” the bank argues.

Ayugi is not new to such controversies as back home, his firm has been in the middle of several financial improprieties as documented in Auditor General reports.

The recent is assertions tabled before Parliament of how Sh9.4 billion was irregularly funneled from the eCitizen platform largely through convenient fees.

The revelations were made by the Auditor General which led the Public Accounts Committee, chaired by Tindi Mwale (Butere) to summon the firms involved among them Webmasters.

“We expect the entities to give their side of the story and explain how they were licensed to collect funds from Kenyans, how approvals were granted, the amounts they are holding, and any possible diversion,” said Hon. Mwale.