What you need to know:
- Two of the industrial properties that are reserved for the expansion of the parastatal’s operations have a market value of more than Sh100 million
- The fraud was perpetrated to insinuate that Kenya Railways surrendered the land to the government, a precondition for leases to be applied for and issued.
- The documents listed Mr Ali Mohamed Islam and Mr Ali Islam Ali as directors of Gold Hazel.
Kenya Railways has lost three prime parcels of land in Shimanzi, Mombasa, in a series of transactions that reveal how well-connected fraudsters grab public property for resale to private developers.
Two of the industrial properties that are reserved for the expansion of the parastatal’s operations have a market value of more than Sh100 million.
One of them has already been transferred to a third party for Sh58.2 million and is earmarked for the establishment of a grain handling terminal.
The irregular allocations came to light through a whistle-blower, who on December 21 last year raised concerns with the office of the Director of Public Prosecutions (DPP) regarding activities on Mombasa/Block XIV/367, 368 and 374.
The office then ordered investigations into the transactions, which unearthed rampant misrepresentation and forgery of official documents.
The fraud was perpetrated to insinuate that Kenya Railways surrendered the land to the government, a precondition for leases to be applied for and issued.
That done, the lease for parcel 367 changed hands in November 2014, nearly four years before the Assets Recovery Agency (ARA) sought to place a restriction on the properties on April 20.
M-Tech Building Works Ltd secured the original lease for parcel 367 on March 15, 2011 for a ground rent of Sh162,000 per year. It then sold the entitlement to Gold Hazel Ltd. M-Tech was also given the lease for parcel 368 while parcel 374 was leased to Mr Mohamed Said Shimasy for a ground rent of Sh104,000 on February 13, 2014.
In the transfer documents, M-Tech directors are listed as Mr Salim Salim and Mr Hussein Hamisi, who are associated with a Mombasa politician.
Attempts to get their comments were futile as those who answered their phones claimed we dialled the wrong numbers despite identity apps showing the lines belonged to them.
The documents listed Mr Ali Mohamed Islam and Mr Ali Islam Ali as directors of Gold Hazel. “We bought the land from M-Tech for business and those are the people you should follow up with,” Mr Islam said. He declined to comment on what due diligence Gold Hazel did when buying the property. Gold Hazel is associated with a grain processing company in Mombasa.
Had they done a proper check, they would probably have balked at the transaction.
Preliminary investigations point to anomalies in the description of the properties, forged signatures on lease and title, typing errors on dates, variations in stamps of the same authority and mismatch between the signatures of Mr Hamisi on the lease and transfer document. There were also salient differences in the leases.
“Anyone presented with all the facts will conclude without a doubt the first title for plot no Msa/XIV/367 was a forgery and any title resulting from it becomes automatically a forgery,” the investigators report concludes. It reached the same conclusion on plot 374.
Kenya Railways Managing Director Atanas Maina told investigators the parastatal never surrendered the parcels, a position backed by the Survey of Kenya and the National Land Commission.
“The properties fall within a Railway Reserve Area,” he said in a February 14 letter to Mr Muteti Muasya of the DPP’s office in Mombasa.
Mombasa land registrar John Wanjohi said he placed the restriction order as directed by the ARA.