Wednesday, 3 September 2014

A vicious battle for control of billions of shillings in assets linked to former President Daniel Arap Moi and Kanu-era Cabient Minister Nicholas Biwott is taking shape

Story: Battle looms over billion-shilling properties

Kanu-era Cabinet minister Nicholas Biwott (centre), is at the centre of dispute.
Kanu-era Cabinet minister Nicholas Biwott (centre), is at the centre of the dispute. 
By MIKE OWUOR More by this Author
A vicious battle for control of billions of shillings in assets linked to former President Daniel arap Moi and Kanu-era Cabient minister Nicholas Biwott is taking shape.
Lawyers representing Mr Moi and Mr Biwott wrote to a company associated with one of their key allies demanding the return of property in Nairobi allegedly held on behalf of the pair.
In what sources familiar with the intrigue say could be a wider scheme to reclaim property previously held in trust by associates of Mr Moi and Mr Biwott, there are fears the dispute could end up in court and partly expose the extent of the wealth of the two individuals.
However, it is not clear why the two men have chosen to engage in legal battles at this moment in time. People close to their families say perhaps those who stand to inherit the property would like it to revert to the principals from the nominees who were entrusted with it.
In a letter dated June 16, 2014, Kipkenda and Company Advocates — representing Mr Moi and Mr Biwott — asked the lawyers of Belgo Holdings Ltd to return two unidentified prime properties in Nairobi worth millions of shillings that they have allegedly been holding in trust.
In an interesting turn of events, one of the letters reveals that Belgo Holdings is associated with Mr Joshua Kulei, Mr Moi’s former private secretary and one of his most trusted allies.
“Our clients are currently reconstituting trustees of their various investments. As the owners of the companies and the properties where your roles are restricted to trusteeship, our clients had verbally indicated to you that they require all titles to the trust properties held by you returned to them,” write the lawyers.
The letter traces the genesis of the ownership to 1980, when individuals associated with a company that was later registered as Belgo Holdings, were allegedly asked to incorporate Lakeview Developments Ltd as the nominees and trustees of Mr Moi and Mr Biwott for the two properties.
But Belgo Holdings, whose shareholders are listed as Akber Abdullah Kassam Esmail and Shirin Esmail, is accused of transferring the property to itself and shunting the interests of Mr Moi and Mr Biwott.
However, in a swift rejoinder dated June 20, 2014, Esmail and Esmail Advocates, lawyers for Belgo Holdings, “categorically deny” that Mr Moi and Mr Biwott have any claim to the properties.
They allege that the only share previously held in Lakeview was in the hands of Mr Gad Zeevi — an Israeli billionaire known to be a long-time business associate of Mr Biwott, particularly through the HZ Group of Companies.
The Belgo Holdings lawyers alleged this was the third time in the last two years that representatives of Mr Moi and Mr Biwott had made “baseless” claims of ownership of the two prime properties.
The letter alleges that the only instructions received for Lakeview to be incorporated were from Mr Zeevi and Mr James Mugoya Isabriye, a Ugandan associated with Mugoya Construction Company, which won major tenders during the Moi era.
But in a twist that draws Mr Kulei into the saga, the lawyers claim one of Belgo Holdings's directors, Mrs S. Esmail, is a nominee of Mr Kulei.
The lawyers further reject allegations that all properties in Kenya belonging to Mr Zeevi were assets of HZ Group and hence belonged to Mr Biwott.
The letter details various complex transactions in the exchange of ownership of the property between 1980 and 1995 to supposedly prove Mr Moi and Mr Biwott had no claim.
“Your clients have no connection whatsoever with Belgo and the properties do not and never belonged to them, either directly or indirectly. They have no right to ask for the documents mentioned in your letter, which are in possession of Belgo. Any legal action against us or Belgo will be defended most vigorously,” the letter says.
The exchange of letters provides further insights into the business dealings of Mr Biwott. In a June 30 letter, Kipkenda and Company Advocates affirm that Mr Zeevi and Mr Biwott previously owned various companies on a 50:50 basis.
But the Israeli billionaire allegedly relinquished all his interests in Kenya to Mr Biwott in 1991 while the Kenyan politician took over all jointly owned foreign assets.
According to Mr Moi’s and Mr Biwott’s lawyers, the two properties in dispute were part of those transferred from Mr Zeevi. “The purported sale and purchase of the properties by you and J.C. Kulei is, in our clients’ view, an unmitigated act of fraud perpetrated by persons who were their trustees and/or nominees.”
The lawyers continue: “This attempt to dispossess our clients’ properties will face the full force of the law in very due course.”
But in response, the Belgo Holdings lawyers allege that Lakeview — which was associated with Mr Zeevi and which partly owned the properties in dispute — was not part of the Kenyan assets transferred to Mr Biwott.
“The properties never belonged to your clients nor can trusts be created on the mere say so of your clients. We do not have a problem to face the ‘full force of the law’ as the truth will always prevail; especially when it is backed by irrefutable documentary proof,” the Belgo lawyers write.
Sources familiar with the ongoing battle say that apart from the efforts to secure the two properties, there may be other assets linked to Mr Moi and Mr Biwott in dispute.
Mr Moi, who is celebrating his 90th birthday on Tuesday, ruled Kenya for 24 years and is said to be one of the wealthiest individuals in the country, with business interests straddling the financial sector, media, real estate and farming.
The Kroll report, commissioned by the Narc administration in 2003, alleged he owned some of his properties in partnership with Mr Kulei and Mr Biwott, among others.
The ownership dispute, should it find its way into court, could be the most epic in Kenya’s history.

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