Cyrus Jirongo on verge of losing Sh103m property over loan

Presidential candidates Cyrus Jirongo. (Photo: Moses Omusula/Standard)

A presidential candidate Wednesday suffered a setback when he failed to block the sale of his property worth Sh103 million.

The High Court declined to stop the auctioning of 102.3 acres that belong to former Cabinet minister Cyrus Jirongo.

The land is in Sambu at Maili Saba trading centre along the Kitale road in Trans Nzoia County.

It was advertised for sale in a local daily last week.

Fall of the hammer

However, those present at the auction were unable to raise the asking price of Sh69 million.

Valley Auctioneer had demanded 25 per cent of the amount at the fall of the hammer and the balance in 90 days.

The Kenya Deposit Insurance Corporation (KDIC) placed Mr Jirongo’s Kuza Farms & Allied Limited in receivership.

It was one of the companies that had defaulted on loans owed to the collapsed Dubai Bank, which was placed under statutory management.

The Central Bank of Kenya (CBK), through its agency KDIC, wanted to recover Sh495 million owed to Dubai Bank.

Jirongo went to court to challenge the decision to place his company in receivership over the debt, arguing that he only borrowed Sh100 million and not the Sh495 million the bank was demanding.

According to court documents, Jirongo says his firm borrowed the Sh100 million from Dubai Bank in the form of a debenture in 2009, a debt the presidential aspirant insists was fully paid.

“The sum of Sh495,289,931 demanded by the defendant is astronomical and not based on any contract,” read the documents in court.

Jirongo further claimed that Dubai Bank had yet to furnish him with a statement of its account despite the fact that he paid Sh117,040 that the collapsed lender demanded as costs for the documents.

But Justice Grace Nzioka declined to block the sale of the land.

Audit report

Kuza Farms was last year listed as one of Dubai Bank’s largest loan defaulters in an audit by Crowe Horwath.

Another firm associated with Jirongo, Sololo Outlets, was also listed as a defaulter after it failed to service a Sh103 million loan for more than three months.

In July 2016, CBK said it would take court action on the defaulters, seize their assets, and report them to credit listing bureaus.

At the time Dubai Bank was placed in receivership, it was holding Sh1.7 billion in deposits. CBK appointed receivers for the prime property in the agriculturally rich region.