Everyone has a picture in their minds of how a certain situation, good or bad, will pan out. But because all humans are fickle, they normally picture themselves as coming out on top.
It does not matter how brazen the caper that a person gets involved in, for example the biggest pyramid schemes in the World, whose promoters were eventually busted and sentenced to centuries in prison, those guys actually believed that they could pull it off and even end up sipping margueritas on some exclusive island, with cash stashed in some offshore account, untraceable and out of the reach of authorities.
But it doesn’t quite pan out that way, does it?
Felicien Kabuga, at one point the most wanted man in the World for his role in the Rwandan genocide of 1994, had managed to evade capture for 26 years, moving from country to country in relative obscurity.
Felicien Kabuga & Sitoyo Lopokoyit (M-Pesa CEO)
At 89 years of age, he actually thought that he had beaten the system and would likely live out his days in relative quiet somewhere in France.
However, with plummeting crime rates in France during the height of the pandemic, and a bored or idle police force, someone decided to look into tips that said Kabuga was in Paris.
Boredom, caused by the lockdowns, among the French police prompted a re-look at the tips that had been ignored previously due to overwork.
A confluence of factors almost always come together to create the right situation where balance in the natural order of things is restored.
These questions and analogies are poignant with regard to the Sportpesa heist and the active role of Safaricom Ltd in its successful execution.
How does M-PESA CEO Sitoyo Lopokoyit see it ending for himself, specifically for his key role in the Sportpesa heist?
What words of comfort does his wife, Lena Karauri, who just so happens to be sister to Sportpesa CEO Ronald Karauri, whisper in his ears at night when he seems stressed at the unfolding events?
What do they say to each other at family gatherings or get-togethers?
For instance, do they believe that the people from whom they have temporarily wrested Sportpesa away from, will slink away silently into the night?
Do they not know that these people come from the same stock that gave us the most decisive freedom fighters this country has ever seen?
Or do they believe that that bravery and decisiveness among those peasants in the 50s, tempered by time and far removed from this generation, is an old wives tale?
In sum, within 5 years of the launch of Sportpesa by its parent company Pevans EA Ltd (PEAL), Sportpesa had grown by a quantum leap, raking in 180 Billion shillings in revenue.
The Kenyatta family, at the time holding the Kenyans Presidency could not fathom that a couple of upstarts could launch a company that would leapfrog everyone else in revenues within a few short years.
By 2018, only Safaricom had higher revenues on one hand, and Sportpesa was one of the biggest revenue earners for Safaricom via its famed mobile money platform, M-PESA.
PEAL had already registered the Sportpesa brands with the registrar of trademarks and had acquired several Paybill numbers and short codes that would become synonymous with these Sportpesa brands.
It was impossible to think of the super-successful Sportpesa betting platform without associating it with the payments system and paybills/short codes.
The shareholders of PEAL then went on to pump Billions of shillings in one of the most elaborate marketing campaigns ever witnessed in Kenya.
Soon the name Sportpesa and its payments platforms were on everyone’s lips and became part of Kenyan football lore.
It is these payment systems and trademarks that the Kenyatta family was interested in, abhorring the hard work of building their own brand from the ground up and preferring to take it over by fair means or foul.
In a couple of deft moves, they engineered the withdrawal of the betting licenses of the top betting companies in Kenya (Sportpesa, Betin etc) and then also arranged for the deportation of their foreign Directors and employees.
The smaller betting companies went on with their affairs unaffected.
The Kenyattas also arranged for an astronomical tax bill to be conjured up by the Kenya Revenue Authority (KRA) and lumped onto PEAL (Sportpesa). The KRA then went to court and asked for orders to block all bank accounts and Paybills associated with PEAL.
With this tax case, President Uhuru Kenyatta was now certain that PEAL was hamstrung in the courts for at least a decade.
Safaricom letter to PEVANS informing them of blocking their Paybill numbers
He then arranged for his relatives to get involved in Sportpesa.
Through a company by the name Milestone Games Ltd (MGL), he arranged for the shareholding structure to be changed such that he held majority shares by proxy.
Poetically, he chose his proxies as RONALD KAMWIKO KARAURI and FRANCIS KIARIE, both of whom were still shareholders and Directors of PEAL.
Uhuru needed them because the ultimate plan was to steal the Sportpesa brands (Trademarks) and their entire payment system, intact.
Through outright bribery and influence peddling, in Government offices, the AGs chambers, and even Judges in the Court of Appeal, no one was beyond bribery in order to allow Sportpesa brands and payment system pass from PEAL to MGL.
It did not matter just how clumsily it was done, there was the assumption that Kenyans have Warthogs memory and that this would all be swept away in the euphoria of the August 2022 General Elections.
There was also the unspoken belief that President Uhuru would continue to rule by proxy once he engineered the electoral victory of his so-called project, though we get the feeling that he would have been shocked by the post-election reality.
We have covered the intricacies of the Sportpesa heist in detail, within our previous articles, most of which have been well received judging from online feedback.
In October 2020, at the height of the infamous and useless lockdowns due to Covid-19, an audacious attempt made by three (3) Directors of PEVANS EA Ltd (PEAL) to transfer the entire SPORTPESA business from PEAL to Milestones Games Ltd (MGL).
These Directors were in the minority because their shareholding in PEAL was low to insignificant. They were;
- Ronald Kamwiko Karauri (6%)
- Robert Kenneth Wanyoike Macharia (3%)
- Francis Waweru Kiarie (1%)
While still retaining their shares and Directorships in PEAL, they had acquired shareholding and Directorships in MGL, even though for all intents and purposes, they were proxies.
The idea was to fraudulently pass the assets of PEAL (Sportpesa trademarks and brands, Paybill numbers and short codes) to MGL for the 2020/2021 football season.
The business of MGL via Sportpesa was to start on 30th October 2020. The company (MGL) mischievously advised the betting regulator (BCLB) of this intention by perfunctory letter, on the same 30th October 2020.
BCLB letter copied to Safaricom on Sportpesa Paybills
The BCLB immediately, in a common sense response to MGL, stopped the company from using Sportpesa trademarks, Paybill numbers, shortcodes and domain names until a matter that was before the Court of Appeal was heard and determined.
MGL was advised to continue using their authorised and licensed trademarks “MILESTONE BET” with its attendant Paybills/Shortcodes/domains.
HOW SAFARICOM RATIONALIZED THE THEFT OF SPORTPESA ASSETS
By the time KRA issued agency notices against PEAL and froze all its bank accounts and paybill numbers at Safaricom, it was close to Ksh. 2.3 Billion in cash seated there.
Infact, Sportpesa CEO Ronald Karauri authorized Safaricom Ltd to transfer the amount of Ksh. 500 million to the KRA at the start of the protracted legal tax battles in August 2019.
To date, with the transfer of these Paybill and short code accounts to MGL, nobody can account for these funds and how they were transferred from Safaricom Ltd.
PEAL letter to Safaricom on payment of 500m tax
All we know is that the deported Directors of PEAL (Bulgarians) had been secretly flown into the country for a meeting with the top brass of Safaricom, ostensibly to decide on the disposal of the cash.
Meanwhile inside Safaricom, M-PESA CEO Sitoyo Lopokoyit arranged for a Novation agreement to be signed between MGL and Safaricom purporting to replace PEVANS EA Ltd with MGL as the owners and operators of the Sportpesa brands, and its Paybills and short codes.
The Paybill numbers and short codes are
- Paybill Nos. 521521, 955100 and 955700
- Short codes: 29050 and 79079
A Novation agreement is made between two contracting parties to allow for the substitution of a new party into an old agreement.
In this case, the old agreement for the aforementioned Paybill numbers and short codes had been between Safaricom Ltd and Pevans EA Ltd (PEAL).
With Ronald Karauri, Robert Macharia and Francis Kiarie being Directors of BOTH Milestone Games Ltd (MGL) and Pevans EA Ltd (PEAL), they purported to authorize the transfer of the safaricom-based assets of PEAL to MGL, and therefore signed the Novation agreement.
On 29th October 2020, a legal officer at Safaricom by the name Isaac Kibere generated the Novation agreement internally.
According to the system history at Safaricom, the Novation agreement was created at 11.58am on 29th October 2020.
Safaricom system log showing how the Novation agreement was dealt with by CEO Sitoyo Lopokoyit
Isaac Kibere then immediately sent the document to M-PESA CEO Sitoyo Lopokoyit, barely a minute after it was created, at 11.59am.
Sitoyo perused it quickly and e-signed off on it at 12.00noon, barely a minute later and the entire process on the side of Safaricom was completed.
Such was the hurry to move forward with the heist, so that the letter to BCLB from MGL advising that the company would henceforth be using Sportpesa property and identity in its business.
2 minutes flat… the time it took from completion of the Novation agreement by Safaricom legal officer Isaac Kibere to final signature by M-PESA CEO Sitoyo Lopokoyit.
…and Sportpesa assets were assigned from PEAL to MGL, just like that.
In fact the urgency was such that Sitoyo, who was signing a formal Safaricom document, did not have in-house counsel to witness his signature.
Signature page on Novation agreement. Sitoyo Lopokoiyit signature in red.
He instead got Robert Macharia (legal officer/ company secretary for both MGL and PEAL) and who is himself a lawyer and commissioner for oaths in his own right, to witness the document on his behalf.
Was Sitoyo signing a private document and shouldn’t the Safaricom legal office have appended their signature and stamp to the agreement?
Ronald Karauri signed the document on behalf of PEAL, despite also being a shareholder and Director of MGL.
Oh what a tangled web we weave, when first we learn to deceive… (Ourselves?).
Everyone who initially engaged with the issue of MGL taking over PEAL assets was astonished at the brash arrogance and circumvention of the law employed here.
The telecommunications sector regulator known as Communications Authority of Kenya (CAK) wrote a letter to BCLB asking for clarification on why mobile money assets belonging to PEAL were now being moved to MGL in such a casual and opaque manner.
CAK letter to Airtel querying change of ownership of Sportpesa Payment systems
More importantly, doesn’t the Betting & Lotteries Act prohibit the principals in one company owning a stake in a similar company within the gaming sector?
How then eventually did BCLB allow for Ronald Karauri, Francis Kiarie and Robert Macharia to be in both PEAL and MGL as Directors and Shareholders when PEAL still has active cases before the courts and has never ceded its intention to get back into the gaming sector?
Shouldn’t these individuals have resigned as Directors of PEAL and sold their stakes in the company before fully joining MGL as Directors and shareholders?
But this would have made their criminal conspiracy impossible, no?
How is major shareholder Vodafone involved in this criminal caper? Are they innocent bystanders or active participants who are happy to rake in as much profit from Safaricom as possible, by fair means or foul?
Screw ethics, eh?
We reiterate this to Lopokoyit, who is an active signatory to this fraud and probably culpable in its execution, how does he think this will end?
Will CEO Peter Ndegwa throw him under the bus when eventually the chicken comes home to roost? In the corporate game of everyone saving their own skins, who will stand with Lopokoyit when the bell begins to toll?
Maybe the people and politicians from his native Samburu County will cry foul that their illustrious son is being targeted unfairly. Puh!
It is time for Sitoyo Lopokoyit to get ahead of this. No one can be sure of the outcome at the roll of the dice.
Felicien Kabuga always thought that he had got away, and he almost had…almost.
3 comments
Very informative.
State capture was real and the masterminds behind this heist should be hunted down and made to account for their evil deeds and jailed.Even the judges who abetted the crime must be exposed too
This political scions are corrupt to the core. And they are now the ones sending eacc to those who are specks. We shall all go down, no keeping quiet when the rooster comes home to roost.