Land-buying companies will be compelled to deposit Sh500 million as licence fees before they are cleared for registration if MPs approve a Bill aimed at protecting investors from fraud.
The draft Bill set to be introduced in Parliament seeks to protect the interests of persons who purchase property from a land-buying company.
Kirinyaga Central MP Joseph Gitari, the sponsor of the Bill, said the proposed law seeks to establish an agency that would regulate the proliferation and activities of all land-buying companies in Kenya.
“The Bill will contain provisions that require land-buying companies to register with a regulator wherein such a company will deposit Sh500 million as a licence fee,” he said.
The MP said the Bill would also contain provisions empowering the regulator to impose penalties of up to Sh5 million for non-compliance by the land-buying companies.
Mr Gitari has written to the National Assembly Speaker Moses Wetang’ula seeking clearance to introduce a private member’s Bill to regulate the activities of the land-buying companies.
“The principal object of the Bill is to regulate the registration, licensing of land-buying companies and to protect the interest of persons who purchase land from a land-buying company,” Mr Gitari said in a letter dated February 14 and addressed to Mr Muturi.
House rules require an MP who intends to propose a Bill to first seek clearance from the Speaker before tabling the same in the House.
“Pursuant to Standing Order 117, I wish to request assistance in the preparation of the Bill,” wrote Mr Gitari.
The proposed Bill comes in the wake of several petitions to Parliament by Kenyans who have complained of being swindled by fraudsters posing as land investment companies.
The National Assembly’s Public Petitions Committee is currently handling a petition by a section of Kenyans who allege that investment firm Cytonn Investments Management PLC misappropriated investors’ cash in one of its projects.
The Cytonn management has since dismissed the claims by three petitioners when they appeared before the committee two weeks ago and welcomed a proposal by MPs to sanction an audit on its investments.
Several Kenyans have lost their money through unregulated investment companies that operate real estate businesses that sell the property as “off–plan”.
Cases of rampant fraud perpetuated by real estate firms last year prompted the Directorate of Criminal Investigations (DCI) to launch investigations into various companies that Kenyans complained about.
The DCI appointed a 26-member special team of investigators with backgrounds in land matters to the Land Fraud Investigations Unit.
The 26 detectives with professional backgrounds in land survey, land economics, land physical planning and administration, among other relevant fields have been deployed to the unit.
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