PHOTO CAPTION: Stephen Jennings, Founder and CEO, Rendeavour alongside Rt. Hon. Raila Odinga at the Unity Homes ground breaking ceremony in 2019.
A social media storm has erupted over an ongoing row pitting Tatu City residents and foreign project owners.
Residents living in the 5,000-acre mixed-use complex with homes, businesses, schools and social amenities are protesting what they say is the shortage of safe water, exorbitant power supply rates and denial of access to internet services.
Local internet providers s like Safaricom, Zuku, JTL have been locked out on the grounds that the services can only be supplied by the Tatu City management.
In an online petition circulating across social media platforms, they have further called on the government to protect Kenyan investors against racism by Tatu City owners, insisting that there has been a great deal of white privilege in the city located within Ruiru constituency.
The residents claim that foreign companies, particularly American firms, are enjoying rates consistent with government-designated Special Economic Zones (SEZ) while on the other hand, Kenyan firms are subjected to colonial treatment.
Tatu City’s local Kenyan staff are also reportedly exploited and mistreated, with many complaining of racist behaviour and high-handedness from their bosses.
Through the hashtag #RogueStephenJennings, a swarm of angry netizens have argued that Tatu City has abused its status as a Special Economic Zone, to exploit its local investors and staff, and therefore, its license should be revoked and an investigation into the legality of the management’s conduct be immediately launched.
Kenya has 15 gazetted special economic zones where investors get tax reliefs as part of government incentives to boost private sector investment.
They have also urged the Ethics and Anti-Corruption Commission (EACC) and Kenya Revenue Authority (KRA) to perform an audit of Tatu City Financial dealings, claiming the project has previously been accused of evading taxes and practising money laundering through paper transactions involving a chain of interlocking companies, nominee shareholders and purported loans and financing structures.
“Tatu City was originally supposed to be a project to benefit Kenyan residents but as soon as cunning investors like Jennings infiltrated the system and ended up making millions at the expense of Kenyans,” one tweep wrote.
Tatu City was originally supposed to be a project to benefit Kenyan residents but as soon as cunning investors like Jennings infiltrated the system and ended up making millions at the expense of Kenyans.#RogueStephenJennings
Tatu City— Onyimbo J (@WuodOnyimbo) November 14, 2022
The residents have also petitioned the Attorney General to probe the litigious nature of Tatu city, noting that of all Western companies in Kenya, Tatu city has the highest number of active cases in Kenyan courts; from tax fraud to unlawful breaches of contracts.
“Tatu City project has stalled due to court cases and ongoing investigation by the government due to alleged underhand dealings and evasion of tax,” noted another netizen.
Details have emerged that Kofinaf Company Limited and Tatu City Limited, the companies involved in land dealings at the Tatu City could have swindled the (KRA) of more than Ksh6.5 billion in tax dues, as well as unsuspecting land buyers. Jennings#RogueStephenJennings pic.twitter.com/fHpzOENx7L
— Ajawa Republic
(@itskiplagat) November 14, 2022
Tatu City project has stalled due to court cases and ongoing investigation by the government due to alleged underhand dealings and evasion of tax.#RogueStephenJennings
Jennings @OleItumbi ,@UKinKenya— girlnextdoor
(@ChebetVickie) November 14, 2022
(@ChebetVickie) Sign this petition and end colonialist rule.
Read the tweets on the hashtag. https://t.co/pJlXZSShzH#RogueStephenJennings
Jennings
— Steppenwolf (@KingLemuel_) November 14, 2022
this man #RogueStephenJennings had to be brought to book and made to refund back all money he had been paid but not delivered on services.
Jennings pic.twitter.com/PEOZLO8SQG— Austin_raily (@AustinRaily) November 14, 2022
As seen from the tweets above, the multi-billion-shilling venture in the name of Tatu City forms a story of raw power, power abuse, suspicion, mistrust and boardroom wars, with Stephen Jennings, the majority shareholder, at the centre of it all.
Over the years, controversy has surrounded the project, including a fight between him and the Kenyan investors, the likes of Stephen Mwagiru, Nahashon Nyagah and Vimal Shah.
According to sources, before coming to Kenya, the New Zealand investment banker’s aim to ‘invest’ at Tatu City was to look for a way to repay heavy debt and losses he had incurred in Russia.
He wanted to oust the Kenyan investors from the project, sell it, pay his debts and leave the country, as witnessed by how he stashed money from the project in offshore accounts.
At one point, Jennings was accused of unilaterally diluting the shareholding of the Kenyan investors and increased his, automatically increasing his powers to pass any motion on the board.
This was done without the knowledge of other investors.
Beyond all these underlying factors, an extensive investigation by the cnyakundi.com team has established that there is more to this intriguing controversy than meets the eye.
The latest twist in the long-running fiasco is strongly linked to the recent regime change in Kenya, which has reportedly sparked great anxiety within the Tatu City management.
Sources, whose identities we shall keep anonymous, have reliably informed us that some of Tatu City’s top managers are contemplating leaving the country after new President William Ruto took over power.
The managers, according to a local Nairobi tabloid, had placed their bet on Azimio candidate Raila Odinga clinching the coveted seat and even pumped over Sh100m into his presidential campaign.
In 2019, Raila memorably attended the groundbreaking ceremony for Unity Homes at Tatu City and took the opportunity to ask Kenyans to embrace the idea of the project.
Attended the groundbreaking ceremony for Unity Homes at Tatu City and took the opportunity to ask Kenyans to embrace the idea of Special Economic Zones. I also appealed for measures to address the high cost of land which is scaring away potential investors from our country. pic.twitter.com/SHwbnKNlkk
— Raila Odinga (@RailaOdinga) May 31, 2019
On the same day, he held consultations with Stephen Jennings, the CEO of Rendeavour Service Limited, which is the group behind the development.
As it turns out, the whole thing was simply part of a massive PR exercise in favour of Tatu City.
Arrived at JKIA and held consultations with @skmusyoka and also met with Stephen Jennings the CEO of @rendeavour which is the group behind the development of Tatu City. pic.twitter.com/ztY2WYrH7j
— Raila Odinga (@RailaOdinga) May 31, 2019
Some of the managers held a crisis meeting last month to plan the way forward due to fears that their past deeds could be exposed under the new regime that looks keen on major reforms across all sectors.
Out of desperation, they discussed absurd ideas; like fundraising money to take to brokers in the new government with the hope of securing their favour.
Among those in panic is Preston Mendenhall Marshall, an expatriate senior manager from America who is currently fighting off claims of racism.
PHOTO CAPTION: Preston Mendenhall, executive vice president of Rendeavour Service Limited.
Mr Mendenhall is the executive vice president of Rendeavour Service Limited, a foreign subsidiary that runs Tatu City.
Some employees have already reached out to the Immigration Department as well as the Ministry of Labour, seeking to have him discontinued from his managerial role on the basis of an expired work permit which reportedly lapsed in June this year.
Mr Mendenhall, who is accused of persistent harassment and bullying, arrived in Kenya on a two-year work permit in 2020.
Complaints have also been written to the Ministry of Labour over unfair practices manifested in arbitrary dismissals.
So far, there are 208 cases in the labour office for dispute resolution.
The controversial real estate firm is also facing claims of harbouring illegal expatriates with work permits obtained through misrepresentation.
One of the complainants has since been dismissed after raising the matter.
The High Court has also allowed investigations into the multibillion project in Kiambu over claims of tax evasion and money laundering.
Justice Esther Maina granted the go-ahead to EACC, saying the anti-graft agency has the power to investigate the offences.
As mentioned above post, EACC said Tatu City was practising a form of money laundering known as loan back scheme that is effected through paper transactions involving a chain of interlocking companies, nominee shareholders and purported loans and financing structures.
A sister company- Kofinaf- for example incorporates special purpose vehicles such as Purple Saturn Properties, with shareholding and directorships held by its nominees specifically to hold parcels of land.
It then enters into sell agreements with SPVs and purports to advance them loans-in effect Kofinaf finances its SPVs to finance its own properties.
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