How legal battles crippled Jirongo

The late former Cabinet Minister faced several legal battles that sunk him financially. [File, Standard]

The name Sololo Outlets featured prominently in Kenyan courts from the early 1990s due to the massive loans it borrowed from local banks to invest in real estate projects such as the Hazina Housing Project in South B, Nairobi.

The company, owned by the late politician-cum-businessman Cyrus Jirongo, accrued huge debts because of protracted court battles, which were also meticulously orchestrated to cripple him politically.

Jirongo spent a better part of his life in court attempting to regain the company’s assets, which he claimed were wrongfully taken from him.

He boasted of owning a large number of properties in Nairobi, but they existed mostly on paper, as most were either disputed or under investigation by the Ethics and Anti-Corruption Commission (EACC).

In April 2012, Jirongo wrote to the pensions fund seeking to repossess the multi-million Hazina Estate due to a protracted Sh1.39 billion dispute between him and the National Social Security Fund (NSSF).

“I want to refund NSSF the Sh1.39 billion I used to build the estate so that I can fully take ownership of Hazina Estate,” wrote Jirongo.

The property was wrested from him when powerful Kanu mandarins orchestrated the freezing of his accounts, placing all proceeds from the properties in the Central Bank of Kenya’s (CBK) Deposit Protection Fund.

Former Kanu legal hawk Mutula Kilonzo, later nominated MP by President Moi, was hired to prosecute cases against Jirongo in the Hazina Estate NSSF dispute.

A report by the Auditor-General presented in court showed that Kilonzo, who had access to the CBK deposits, unprocedurally paid himself millions of shillings in legal fees without the knowledge of other parties.

Kilonzo’s law firm was flagged for improperly paying itself Sh176 million, alongside several other legal firms that earned a total of Sh252 million acting for NSSF in the Hazina Estate dispute.

Kilonzo was quoted by The Standard denying any political wheeler-dealing in the NSSF versus Sololo Outlets case. “I acted in the best interest of my client. I did what my client wanted me to do. I was doing legal work, not politics,” said Kilonzo.

Fall out

The lawyer’s role began when Jirongo fell out with powerful forces in the Kanu regime, culminating in his ejection from the housing estate and seizure of his property.

Court documents show that Jirongo’s relationship with Hazina Estate began silently in 1987 when his Sololo Outlets Limited purchased 23 acres of land in South B at a price of Sh60 million to develop the houses, he intended to sell upon completion.

His dealings with NSSF began after he had completed the Hazina projects. They approached him to manage the houses, and he willfully transferred them to the pensions fund.

It was reported that NSSF agreed to pay Sololo Sh1.2 billion, for the project comprising of 100 maisonettes, 320 residential flats, one nursery school, a shopping complex and a primary school that accommodated 160 children.

The politician initially borrowed Sh1.1 billion from Post Bank Credit, using a 1,000-acre piece of land in Ruai as collateral. He also applied for another Sh1.65 billion loan from the same bank, using a further 2.5-acre plot in the Mukuru slums.

When the late Cyrus Jirongo addressed residents in Panpaper town in Lugari, Kakamega County during the 2022 election campaigns. [File, Standard]

Post Bank was among 17 banks that collapsed at the height of the Goldenberg Scandal, along with Kamlesh Pattni’s Exchange Bank and Trade Bank. Given Sololo Outlets’ long-running court battle with NSSF, the loans were never repaid.

It also emerged that Jirongo’s 1,000 acres in Ruai had been hived from 13,000 acres originally allocated to the Nairobi Water and Sewerage Company in 1986. Politically correct Kanu politicians subdivided the plots and left the company with only 3000 acres. 

Jirongo had recently moved to court seeking to develop both the Ruai and Mukuru properties, but nothing materialised, although the Nairobi County Government agreed to pay him Sh200 million in an out-of-court settlement in 2016.

The construction of the Hazina Estate also witnessed drama when lawyer Kilonzo and the Head of Civil Service, Philip Mbithi, colluded to evict Sololo Outlets and hand it over to Mugoya Construction mid-stream.

Documents show that Kilonzo wrote letters to Mbithi detailing how police were to handle Sololo and Jirongo. He also shared details of how the money from Post Bank Credit was disbursed to Sololo. In one letter, Kilonzo told Mbithi: “In the course of our work we have sensed a lack of enthusiasm on the part of the CID, particularly Mr Kimundi, who has been the investigating officer. We subsequently recommended to the Committee that Mr Kimundi be replaced, which has been done. Mr Slim has taken over, and we are happy to note a distinct improvement in attitude.”

He also called for the speedy prosecution of the late Dr Davy Koech, whom he described as a principal participant in the transactions, allegedly to avoid accusations of discrimination and bias.

Kilonzo was reported to have written to State House on how to “nail” Jirongo, stating his law firm had identified more than 180 properties belonging to Jirongo and his associates and recommended they be investigated.

It was also reported that, at one point, Kilonzo asked Mbithi to instruct the Special Branch to “mount detailed surveillance on Jirongo and his associates to ascertain whether they were a threat to State security because of the amount of cash they allegedly held.”