Kenya: KAMP responds to damning audit

KAMP expressed dissatisfaction with the newspaper’s coverage, arguing that it ignored its response to the regulator, the Kenya Copyright Board (KECOBO), on 18 May.

The audit, performed by Muita Njoroge and Associates, covers January 2020 to December 2022. It revealed that KAMP and the Performers Rights Society of Kenya (PRISK) failed to remit millions of shillings in royalties to artists. Most of the funds were diverted to administrative expenses, in violation of the 70:30 rule that mandates 70% of the funds to be allocated to artists.

The audit further revealed that KAMP owes artists unpaid royalties of more than Ksh14m (about $100 000), dating back to 2013. It also indicated that Kenya’s three largest collective management organisations (CMOs) – PRISK, KAMP and the Music Copyright Society of Kenya (MCSK) – unlawfully awarded a KSh80m contract to Liberty Afrika Technologies for a royalty collection and distribution system.

The report highlights that KAMP undershot royalty distributions by about Ksh75m and made payments amounting to Ksh3m in unmerited allowances to board members and staff between January 2020 and December 2022.

KAMP’s executives, CEO Maurice Okoth and chairperson Angela Ndambuki, have defended their actions, emphasising their commitment to transparency and cooperation with the audit firm. They also challenged what they described as an unfair, broad condemnation for the conduct of other CMOs.

In an 18-page letter to KECOBO, KAMP detailed its responses to questions about funds mismanagement, royalty distribution and procurement procedures. Okoth and Ndambuki said their response had been deemed acceptable by KECOBO, leading to the renewal of the CMO’s operating licence.

Regarding the 70:30 rule, KAMP explained that while it strove for the required ratio, 50% of collected revenue would be set aside for royalty distribution until optimal operations were reached.

On the award of Ksh80m to Liberty Afrika Technologies, KAMP said it had questioned and opposed the process that was being spearheaded by KECOBO and that a termination of the contract was underway. “Both [the] KAMP and PRISK boards sitting on 14 April 2023 resolved to institute termination of the unprocedurally awarded contract to Liberty Afrika.”

KAMP also announced legal actions against those accused of misappropriating funds, and plans to revamp its human resources and accounting policies to prevent financial losses.

The executives elaborated on the challenges faced by CMOs in Kenya, including non-compliance by broadcasters and regulatory tariff reductions, but assured their commitment to lead reforms in the sector.

Ndambuki said: “We are struggling. This needs to be made clear, but as far as distribution goes, we are the most compliant and best paying organisation at 50%. Of course, there are challenges but we are committed to introducing reforms that will work for all concerned.”