Agents to be Held Liable in Cases of Land fraud
A new bill has been proposed by Kirinyaga Central MP Joseph Gitari aimed at protecting land buyers in Kenya from fraudulent practices.
The proposal will require land agents to deposit KES 500 million as a surety that will safeguard customers from being victims of fraud.
The bill, which mirrors the depositor’s protection fund established to protect customers against the loss of deposits following a bank collapse, seeks to establish an agency that will regulate the proliferation and activities of all land-buying companies.
It will also contain provisions empowering the regulator to impose penalties of up to KES 5 million for non-compliance by the land-buying companies.
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Speaking on the proposed bill, Gitari said, “We are trying to protect hustlers who are tempted. Told there are ‘Buroti Maguta Maguta’ where a plot goes for 30,000 and you are given 2-3 years to pay. By the time you go to their offices to pay the balance or collect documents, you find them closed.”
The MP noted that the bill will not regulate land buyers, but rather protect them from land fraud agents.
In 2017, the Ministry of Lands recorded 7,052 cases of property fraud, which could be costing the economy about KES 60 billion annually, according to Cesare Mbaria, the Director of Survey.
The proposed bill comes amid reports of many real estate companies that have folded with investors’ money without delivering on the land and houses promised, while others still in operation have not delivered on contracted projects or have been taken to court by investors who are pushing for refunds or completion of projects.
Companies with cases at Kiambu law courts or Thika Land and Environment Court include Banda Homes, Dinara Developers, Lettas Developers, Tehillah Holdings, and E-Farm Housing Cooperative Society, among others.
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