Female investors lament extortionist hospitality sector policies

Female investors in the hospitality industry in Mt Kenya have complained about harsh government policies that undermine their businesses.

They say the policies expose them to corruption, gangsterism, illegal rates and extortion.

“We are required to pay more for licences by the county governments, the police want us to be paying protection fees to them and area gangs want extortion fees from us. At the end of the day, we find ourselves reducing our profit margins to a point we are struggling to pay our recurrent expenditures, save and expand,” said Ms Faith Karimi, Mt Kenya Female-owned Bars and Hoteliers Welfare Association treasure.

She said most of the sector’s investments are male-dominated and welfare associations are controlled by men who strike deals with the police and gangs to be hard on female-owned investments.

“To sell illegally, most male investors collude with corrupt police officers to have us pay protection fees. Even when we contribute higher amounts, when crackdowns occur, they are harsh on us and lenient on male investors. All towns have their resident gangs and they extort money from investors. They are harsh on us as we are feminine and cannot confront them,” she said.

Murang’a Woman rep Sabina Chege says she has received numerous complaints about the issue and is engaging Interior PS Karanja Kibicho to take action.

“We cannot have those entrusted to create enabling environment for businesses to grow being the very ones sabotaging profitability, especially in the face of the raging Covid-19 negative effects on trade. The government must take note and move in with speed to address the menace,” she said.

Kandara MP Esther Wahome said “we cannot continue entertaining some corrupt government officers who see businesses as their cash cows,” adding that the issue is so grave it demands a presidential directive to the Interior Ministry to address it.

Ms Wahome said women investors must be protected given the “majority are genuine traders whose only objective is to earn an honest living, employ some workers and help the national economy grow.”

Scramble for the market

She said most men in the sector believe in unorthodox methods of scrambling for the market share and even sponsor gangsters against female investors to force them to shut down.

“When we have government teaming up with gangsters to hound women out of business, it is enough cause to invoke national protest,” she said.

Ms Agnes Kiura, an investor in Kiambu, expressed hope that the new regional commissioner in Central, being a female, might intervene and fix the problem.

“Our new Regional Commissioner Esther Maina has served in Kiambu as a county commissioner. I know her as a gender equity-driven administrator and she might be our hope since all the atrocities we encounter are aided by government officials,” she said.

The owner of Four Star Emory Hotel in Nairobi’s Kileleshwa area, Ms Lizzie Wanyoike, urged the government to take a keen interest in the way women investors are treated.

“I would like to imagine that the government genuinely wants us to prosper in business so that we can help create employment and boost national economy by paying taxes. We should be protected from all acts of commission and omission that drive us into folding up because of corruption and extortion,” she said.

Belittled

Keroche Industries chief executive Tabitha Karanja said being a female investor in this country comes with the challenge of being demeaned, belittled and sometimes trashed.

“I have had my share of such antibusiness forces and I have hardened up. I have learnt to confront my challenges and face them head-on. But the government must know we are not happy. We demand that female investors be accorded an equal playing field with men. It is even harder when a female investor’s competitors are multinationals. The government is sometimes influenced by multinationals to be harsh on indigenous investors,” she said.

Central Region Business Owners Association chairman Alfred Wanyoike concurred, saying some government officers behave like extortion gangs.

The debate has been ignited by a Murang’a in December last year when a senior government officer using a letterhead of the Office of the President sent out letters to bar owners demanding money to fund a year-end party for his juniors.

The bar owners in protest leaked the letter to the media and after the issue was publicised, the scheme was dropped. But the officers proceeded to seek entertainment services from a privately owned joint and had run away with a bill of Sh57,000, which was later paid after Nation.Africa highlighted the issue.

“Bars owned by female investors were being told to pay double the amounts imposed on male-owned ones,” he said.

The case was followed by another on December 31, when officers in Kandara were accused of raiding an entertainment joint beat up revellers, seriously injuring five, who included the female owner, after they were denied free services.

Area police boss Michael Mwaura said he has since taken over the case for investigations.

Mr Wanyoike, also the chairman of Kiambu Business Community Association, said the trend is perpetuated by some senior officers in the National Police Service and the national government administration.

 “They come up with con projects, which they baptise different names. Some of the names are protection fee, cooperation budget, capacity building, business community and security officers bonding, and year-ender parties,” he said.

The projects end up being extortion drives where entertainment joint owners are required to pool resources and present to the architects of the scheme.

“In other instances, the officers, without notice, show up in your establishment and order expensive services, consume and leave without paying, referring the bills to the owner. Some are even excessive as they show up with their lovers and use lodging facilities without paying,” he said.

Mr Wanyoike said when some investors demand to be paid, a security scheme is hatched to force them to close up shop.

“They start by making perennial raids on your establishment and effect arrests that end up with employees, customers and the owner charged. Officers just drop in on flimsy grounds saying they are inspecting licences, searching for poisonous alcoholic brands or saying there are suspicions that among the patrons there are criminals.”

He added that police even force their way into lodging rooms with customers on the pretext that they are inspecting.

“The nature of the hospitality industry is that when customers associate your establishment with constant police raids, they boycott you. The officers succeed either in whipping you into submission or forcing you out of the market,” Mr Wanyoike said.

Former provincial commissioner Joseph Kaguthi said “such acts are as old as government where we had chiefs who would in the name of government harambee raid homesteads and forcibly take away livestock and harvests.”

‘Official extortion’

He added that with time and civilisation, that culture has been criminalised and it is the work of relevant institutions to act responsibly and save the government’s face from “official uniformed extortion”.

County Commissioner Wilfred Nyagwanga said such acts have not been commissioned by the government.

“All forms of harambee financing are illegal among government officers…all in such schemes are by criminals who are supposed to be arrested and charged in court. It is not the position of the government and it is not a tradition in the public service,” Mr Nyagwanga said, adding that some incidents have reached his office and have been addressed with the seriousness they deserve.

“We are there as government to facilitate trade…ours is to protect lives and property and help citizens found business and grow wealth. It will be saddening to hear that we are at the same time being accused of sabotaging investments…that is not a government culture, it is simply criminal,” he said.

Mr Nyagwanga ordered all county commissioners to probe all officers in the scheme and push for their prosecution on the grounds of infringing the integrity befitting public office holders.

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