On 31st March 2014, a Danish based online lending platform MYC4 issued a statement informing international lenders that one of its African partners Kenya Entrepreneurship Empowerment Foundation (KEEF) based in Kiambu, had embezzled funds in excess of Ksh 214 million. For starters, MYC4 carries its operations through an online lending platform where investors from 120 countries across the world make bids to fund profiled entrepreneurs from Kenya.
Entrepreneurs are profiled and uploaded by Micro finance Institutions in partnership with MYC4. At the center of this multi-million scandal was none other than the controversial Kiambu businessman Mr. Daniel Kimani, founder and CEO of the now collapsed KEEF. Kimani is at the center of yet another scandal. The Ridgeways Inn – The Yard, this time he is attempting to wrestle the hotel from its rightful owner a former Miss Tourism Kenya winner, Ms. Sylvia Wambui Karanja.
Following the KEEF scandal, Danish Embassy in Nairobi wrote to the Directorate of Criminal Investigations as well as the Banking Fraud Investigation Department calling for a speedy conclusion of the matter and within the rule of law. In the letter, the Embassy accused KEEF of defrauding the Danish firm, MYC4, the money that was meant to offer farmers and small traders’ loans in the wider county.
According to MYC4 Chief Executive Mads Kjaer, KEEF had received about Sh120 million from MYC4 to on-lend to farmers and small traders but the owner of the micro lender, Daniel Kimani, vanished with the money after recovering the loans and interest.
“It has come to the attention of the Royal Danish Embassy in Kenya that the Danish micro-finance provider MYC4 A/S is involved in a legal dispute with one Mr. Daniel Kimani, a Kenyan citizen,” reads part of the separate letters written to the CID and the Banking fraud investigating unit. The two letters were dated October 27, 2015. “Mr. Kimani is suspected of fraud and investigations are ongoing.”
A third letter to the lawyers of Mr. Kimani E.M Washe & Associate Advocates had asked Mr. Kimani to present himself to the embassy in Nairobi to provide a specimen of his personal signature to allow for a comparison of signatures across documents that are key to the investigations. Fearing arrest, he never appeared.
The letters say the Danish Embassy was following the matter closely and supports its just conclusion according to the laws of Kenya. “We note that the Banking Fraud Investigations Department and the Criminal Investigation Department are involved in the settling the case,” the letters adds.
The Ksh120 million in question was the loans and accrued interests that MYC4 investors had extended to ‘23,000’ clients through KEEF, a local microfinance institution that claimed to be empowering local communities by supporting initiatives that promote women and youth empowerment through micro credit.
“Danish investors have lost money because KEEF has refused to repay the money. This scandal could have adverse effect on the local microfinance industry and deny Kenyan businesses much needed funds,” said Mr. Kjaer, the MYC4 CEO. “KEEF has refused to honour its contractual obligations to remit the loan repayment monies to MYC4 accounts despite repeated prodding and attempts to resolve the matter amicably.”
MYC4 was to later establish that, KEFF only appeared on papers; there existed no farmers apart from Daniel Kimani himself. Using the proceeds ‘extended’ to youth and women groups, Kimani built a farm in Mushroom Estate off Kiambu Road where he reared 500 dairy cattle.
This prompted MYC4 to seek legal redress but the slow pace at which the matter was being resolved forced the investment firm to halt extending more financial support to local enterprises.
“We hold the view that failure by KEEF to honour its obligations could impact negatively on the entire MFI industry and make it impossible for local institutions to source for cheap funds from private investors to on-lend to Kenyans,” observed Kjaer. MYC4 had entered into an agreement with KEEF in 2011 in which the former was to offer loans ranging from KSh10,000 to KSh1 million to Kenyan enterprises through the latter.
The loans, according to MYC4, are sourced from investors across the world and accessed by local enterprises through an online platform.
‘The Provider and Loan Administrator Contract’ showed that KEEF acted as the provider and loan administrator; effectively making it the link with all the borrowers. With its base as Kiambu, KEEF operated in 18 location in Central, Nairobi, Eastern and Rift Valley provinces focusing mainly in agriculture.
Despite frantic efforts by Danish Embassy to settle this matter, Daniel Kimani used his connections at the DCI to frustrate the investigations. He enjoyed a lofty relationship with former DCI boss Ndegwa Muhoro – accused of protecting criminals.No sooner did MYC4 suspend its funding to KEEF, Daniel Kimani started recruiting youth and women groups into the Micro Finance, he needed money to furnish his lavish lifestyle and this idea came in handy. KEEF started lending out money as well as collecting savings from unsuspecting business people.
As fate would have it, claims started flowing in; KEEF was unable to give loans as promised to its clients who had saved millions of shillings with the outfit. Before long, Daniel Kimani and his cousin Simon Kimani – an employee with NHIF were arrested and arraigned at a Kiambu Law Court on charges of operating a microfinance business without license from the government.
The duo were charged that on diverse dates between 20th January 2012 and 22nd May 2014 at Mapa House in Kiambu within Kiambu County, jointly being managers of Kenya Entrepreneurship Empowerment Foundation (KEEF), they were found carrying out a deposit taking microfinance business without a license from Central Bank of Kenya.
They were arrested on 18th March 2017 pleaded not guilty before Chief Magistrate Justus Kituku. They were represented by Mr. Andrew Gachoka, who told the court that his clients were not aware of the crime they were engaged in as they were employees who thought it was registered. Their lawyer requested the court to give his clients reasonable bail terms as his clients were innocent until proved guilty. The advocate also asked the prosecution to supply him with copies of the witness statements and a report from the DPP.
The lawyer also requested for a convenient hearing date so as to gets more time to have all the necessary information and also go through witness statement and prosecution report. In his ruling the Magistrate fixed the hearing of the case for 30th June 2017. The duo were also asked to deposit a bond of Sh100,000 or a cash bail of Sh30,000 to enable them attend their case while they were free people.
Evil may flourish, but for a short time; Daniel Kimani’s ‘fortune’ went south. He could no-longer live large, his dairy farm collapsed, lenders were pursuing him and his marriage was facing serious turbulence. Interestingly, the land where he had put-up the dairy farm was on leasehold. He contracted his father in-law who is a respected contractor to construct the cow sheds, water tanks, offices, a perimeter wall worth millions of shillings, but as usual never paid.
Instead, he fabricated his own wife with whom they have two children that she was seeing a taxie driver in Kiambu. In an ugly turn of events, Kimani called the taxi driver to his farm in Mushroom Estate. Going by the size of the farm, he had over two dozen workers. The poor taxi driver who normally carried his wife – she had no car, was surrounded by the farmhands.
Kimani alleged that he was having an affair with his wife. In the farm, Kimani had constructed underground storage tanks, the taxi driver would be dipped head down for minutes and then removed; she was forced to admit that indeed they had an affair and that she had bought him the taxi. Just like that, the debt owed to the father in-law was as good as bad debt!
The Ridgeways Inn fiasco; upon her return from Australia, the 28years old Sylvia Wambui met Daniel Kimani. He was a regular patron. They immediately struck a rapport and before long they started dating.
The land where Ridgeways Inn sits on belongs to an Asian, who through a property manager or agent leased the property to Wambui’s father Mr. Karanja, a wealthy businessman based in Eldoret. His lease though expired in 2016. Wambui’s dad had already become ill and he could no-longer run the premises. He handed over the business to his daughter who had just returned from abroad.
Love was in the air, the pair was now living together as Kimani moved into Wambui’s rented house in Fourways Junction Estate off Kiambu road.
When she returned from Australia, Wambui had anticipated starting an online based business like Jumia. That’s how Bebadis Co. Ltd was born. Unfortunately the business never kicked off. All this time, Wambui was running The Yard as the sole proprietor. Kimani would pass by to assist her as a friend, ‘nothing much’. However, business started to flourish, and they needed a collection account or Paybill. Since Bebadis had a Paybill number, they started using it instead of registering a Ridgeways Paybill.
Bebadis Co. Ltd has no asset; it was just being used as a Collection Paybill platform. All through, Daniel Kimani was plotting a takeover. As a matter of fact, he even approached the property agent behind Wambui’s back making inquiries on terms and conditions. Luckily for Wambui, the property agent knew Kimani was a perennial liar, conman and defaulter. They secretly informed Wambui who on this realization registered another company, which secured the new lease and consequently now runs The Yard.
In the meantime, to fully convince Wambui that he loves her, he proposes to visit her parents for dowry negotiation; Ruracio.
Prior to this arrangement, the couple had sort a financial service from a local bank under Bebadis Co. Ltd. Note, all payments to workers and buying of beer and consumables was being made under this company since it was the collection account. Its accounts were running into tens of millions thus its appraisal would have been easy.
It’s at this juncture that the bank revealed that one of the directors was listed with CRB and unless he was cleared they couldn’t access the loan facility they were looking for. In her innocence and having lived abroad for long, Wambui didn’t know Kimani’s thuggish past. She though he had defaulted a few thousands on mobile borrowing platforms. Note; Kimani presents himself as a wealthy businessman.
Instead of clearing with CRB, Kimani proposed that he and his 24years old niece also a shareholder surrenders or transfers their shares to Wambui for her to get the loan. Kimani had successfully convinced or confused Wambui and his plans were on cause. Kimani contacts his cousin who is a lawyer, also called Kimani, who drafts the transfer documents and delivers them at night to the couple’s house in Fourways Junction Estate.
After reading through, they all sign the transfer documents but since Lawyer Kimani was called at night, he had not carried his stamp. Daniel Kimani has no problem with that; he informs everyone that everything would be sorted the following day. He pays Ksh 50,000 for the service. Wambui is now in full control of Bebadis Co. Ltd, or so she thought. Known to her, the lawyer who drafted the documents and witnessed the signing, his fiancées cousin, did not use his stamp, may be by design.
Wambui proceeded to inquire from the bank why her partner had been blacklisted by CRB. To her shock, Kimani had been listed for defaulting Ksh 114 million at Cooperative Bank, 7 Million Equity Bank and several other banks. It now dawned on her that she was dealing with a criminal, possibly courting death.
Back to Ruracio; the D-day was finally here. To the shock of Wambui’s relatives, Kimani arrived driving in her Mercedes. Her uncles asked, ‘him who goes to ask for their girl in hand driving her car and living in her house?’ Further, they were now aware of his several scandals running into over Ksh 100Million. Wambui’s father exuded that he was not ready to marry her daughter into myriad of problems. Besides, they were now privy to the details of his previous marriage.
It’s time to run. Wambui calls her Manager at Ridgeways Inn and gives instructions that Kimani shouldn’t be allowed to access the facility. She goes to ‘their’ house at Fourways Junction Estate and packs her belongings. Hell hath no fury like a ‘woman eater’ left before mission is possible. Kimani goes with a hit squad and robs the Yard Inn when Wambui told him she’s done with his conniving ways. What follows is a rat race, Kimani is arrested for theft and assault – case is ongoing at Makadara Law Courts
Upon his release on bail, he swore to teach Wambui’s family a lesson using the stamp technicality; it was a plot all through. He calls the lawyer whose ‘stamp’ was used on the transfer documents, pays him Ksh 120,000 to sue Wambui for forgery. From reliable sources, Kenya Insights established that the lawyer in question suffers lucid moments; he is not of sound mind. For the tenth day now, Sylvia Wambui is in police cells in Engineer, Nyandarua County. She had to run away fearing for her life after it emerged that she was unknowingly dealing with a criminal.
The big question! How has Kimani managed to fool every tom dick and harry in his escapades? With the help of a rotten and corrupt judicial system, Daniel Kimani has always had the last laugh in the courts. Since the KEEF scandal, he has known his way around courts. Besides, he continues to use corrupt elements in the National Police Service, at the DCI. Sources have revealed that, despite the change of guard at the DCI where he enjoyed a lofty relationship with Muhoro, he continues to enjoy protection from unknown quarters.
Sources say he borrowed the KEEF idea from his uncle Dr. Simon Gicharu – Mount Kenya University founder and chairman who established Kenya Entrepreneurship Promotion Programme (KEPP), which provided micro-loans and training to young entrepreneurs just like KEEF, only that the later was fraudulent.
His networks runs deep even into the media houses. Daily Nation to be specific has not only been biased in reporting the facts of this story but has extended to a cover up, pulling down a digital news item it posted on the collapse of KEEF.