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Court to Hear Witness in MetEC Corruption Case


April 13 , 2019
By KALIKIDAN HAILU ( FORTUNE STAFF WRITER )


Prosecutors amended charges against Alem Fitsum, managing director of Alemgenet Steel Factory, and former officials of the Metals & Engineering Corporation (MetEC) having to do with illegal procurement of a hotel and a plastic factory.

Alem and the former officials of the Corporation, including the former CEO, Kinfe Dagnew (Maj. Gen), were charged with high crimes of corruption for transactions involving the Rivera Hotel and PVC Profile Factory, which were allegedly carried out without proper and legal bidding processes and instituting exaggerated values of the properties.

The initial charge was filed on January 15, 2019, against 11 defendants who pleaded not guilty on February 7, 2019. Subsequently, judges of the 15th Criminal Bench of Lideta Division adjourned the case to April 8, 2019, to hear the testimonies of the witnesses.

On March 27, 2019, prosecutors filed requests to amend the charge through the court registrar. The lack of clarity in showing the price exaggerations and failing to exhibit the claimed price differences were cited as reasons for the amendment, according to the prosecutors. On April 3, 2019, the prosecutors further requested to call additional expert witnesses who will provide the court with estimated prices for the properties.



During the session that was held last Monday, April 8, 2019, the defendants opposed the prosecutors' new filings, stating the amendments do not have any material bearing on the content of the accusations. However, the judges accepted the prosecutors' requests and allowed them to amend the charges and call the additional witnesses.

The amended charges were filed last Wednesday, April 10, 2019, against the 11 defendants who face two counts. The first count includes seven defendants, including Kinfe and Alem, and alleges abuse of power in the illegal procurements for the two properties. The second charge also accuses the defendants of causing damage to the public interest.


MetEC procured the properties outside its mandate and without planning, market analysis, proper procurement procedures and with inflated values, according to the charges.

"Even after the procurement of the properties, the Corporation incurred additional expenses paying capital gains that were supposed to be paid by the seller," adds the charge.




The prosecutors accused the defendants of falsely exaggerating the size of the plot areas of the two properties to 11,000Sqm from the actual 6,941Sqm. Additionally, the charges claim that MetEC received two sets of defective machinery during the PVC plant transaction that cost 3.7 million Br.

The allegations in the first count also say that debt the PVC factory procured from the Development Bank of Ethiopia was transferred to MetEC, which caused the Corporation to pay 131 million Br as a loan payment.

The second count includes five defendants, including Knife and Ermias Amelga, founder and former CEO of Access Real Estate. The government claims that the procurement price of the Imperial Hotel from Ermias was inflated from the actual price of the hotel by 21 million Br.

It is also alleged that MetEC's officials signed and approved a contractual agreement with the knowledge that the property had a third-party claim, according to the prosecutors.


In their filings, the prosecutors attached a list of 15 witnesses and 24 documented pieces of evidence under the first count and more than 16 documented pieces of evidence under the second count in support of their claims.

After hearing the amended charges, all of the defendants stated that they do not have any objection to the amended charges. After hearing both sides, the judges adjourned the case to June 17, 2019, to hear the prosecutors' witnesses during a ten-day session.



PUBLISHED ON Apr 13,2019 [ VOL 19 , NO 989]






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