A FILE PHOTO of Mwananchi Credit Limited CEO Dennis Mombo
A judge has halted the eviction of a family from a property worth hundreds of millions at LR No. 2327/252, at Hardy, in Karen, Nairobi, over suspicions of money laundering.
Justice Alfred Mabeya halted the eviction of Mr Shreedhar Girdharlal Hirji from the property in Hardy, pending the hearing of a case challenging the October auction that led to the sale of the property.
The auction, conducted by Mistan Auctioneers on instructions from micro-finance lender Mwananchi Credit Limited, was intended to recoup an outstanding loan of Sh86.2 million that the lender claimed from Mr Hirji, who trades as Harrogate Ltd alongside his partner, Alice Muthoni Thuo.
Proofless transaction
However, Justice Mabeya raised concerns over the validity of the winning bid, as the lender had claimed that the highest bidder placed an offer of Sh135 million for the property and paid Sh33.7 million in cash.
The property was sold to one Alexander Kubo Mlawasi who walked away without even demanding a valid receipt.
Court documents show that the land valuation report relied on during the sale was unsigned and there was no evidence the two bidders paid the prerequisite Sh1 million to participate in the auction.
The judge noted that there was no evidence of the source of the money or whether it had been deposited in a bank, and questioned the legality of such a cash transaction.
“Why would the alleged purchaser be accommodated and deal with sale outside the express conditions of sale that required a banker’s cheque? Isn’t the law that huge transactions be conducted by way of bank transfers in order to curtail money laundering?” asked the judge.
Justice Mabeya stated that the questions around the source of funds were serious and could only be determined at the trial, and added that there was no evidence of any receipt issued by the lender to the interested party upon receiving such large sums of cash.
He further noted that all that was produced in court were receipts by the micro-financier to the auctioneer, and there was no bank statement by the defendant to show the deposit of the aforementioned sum on the material date.
The judge deemed the issues raised to be so serious that unless they were properly interrogated at a full trial, serious injustice may be meted out on Mr Hirji and Ms Muthoni.
The judge stopped the eviction, stating that the owner would suffer harm as they would be dispossessed of their property, and the rights of third parties might kick in, thus compounding the matter.
Blindsided
The couple had moved to court in 2021, challenging the loan which had grown from Sh43.1 million to more than Sh88.7 million.
They argued that the interest was illegal and against the ‘in duplum’ rule, which states that interest stops accruing when it exceeds the principal amount that a borrower was advanced.
Evidence tabled in court showed that the entrepreneurs indeed borrowed a loan from the lender but the full amount was never disbursed.
Ms Muthoni told the court that only Sh7.5 million of the loan was wired to the account after which the loan shark owned by Dennis Mombo, who is the baby daddy to media personality Linda Ogutu, claimed she had fallen back on payments and sought to auction the property.
They attempted to stop the auction last year arguing that the lender structured the loan in a manner that made it impossible for him to repay the debt, but this was dismissed by Justice Mabeya.
As she set out to fight the case in court disputing the loan amounts, Mistan Auctioneers advertised the property and sold it in October last year; and in November Ms Muthoni received an eviction notice.
Feeling betrayed and determined to fight for her property, Ms Muthoni opened a new battlefront only to discover that the property had been sold at a lower value than what it was worth.
Furthermore, the auction only had two participants, one of whom was allegedly the son of the auctioneer, Mary Rita Wanjiku.
Ms Wanjiku denied that one of the bidders, Mr Staneley Wanyoike, was her son, or that he ran a Facebook account for her in which he posted pictures where they appeared together.
However, the court rejected her supplementary affidavit after it was revealed that it was sworn by another party, Sylvia Wanjiru Njoroge.
In addition to this ongoing legal battle, Dennis Mombo has a history of unethical and criminal behaviour.
This blog has previously exposed Mombo’s rogue character, including an incident in which he assaulted one of his employees at Mwananchi Credit Limited, and subsequently terminated his contract in an irregular manner.
He then colluded with corrupt police officers from Central Police Station and Nairobi DCIO to further torment the victim and obstruct his pursuit of justice.
It’s well known that Mombo exploits and imposes harsh rules on his employees while mercilessly loaning desperate Kenyans to death and haunting them to their graves.
The unchecked con game at Mwananchi Credit Limited must be brought to an end.
Soon we will expose all agencies that have been pocketed to allow the loan shark to operate unchecked.
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