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From Multimillionaire to man dogged by debt

Former Rugari MP Cyrus Jirongo.
Former Rugari MP Cyrus Jirongo. FILE PHOTO | NMG 

Wednesday September 19 will remain memorable to Cyrus Jirongo for the rest of his life. He spent a night in police cells for non-payment of a debt.

Without the help of Devolution secretary Eugene Wamalwa — who presented his Mercedes Benz car as surety for his release yesterday — things would have only got worse for Mr Jirongo who 26 years ago wielded power as a luminary of a well-oiled re-election campaign machinery for then president Daniel arap Moi.

As part of the showy Youth for Kanu 92 campaign brigade, Mr Jirongo became a household name for his immense wealth and political influence — dinning with the high and mighty.

But as it turns out today nothing is permanent and the politician finds himself in a rather tough patch financially, struggling to pay off his debts.

Lawsuits and property auction threats against Mr Jirongo for non-payment of debt have intensified in recent years, revealing the piling financial woes that have befallen the politician. His latest troubles began on Tuesday when the police enforced an August 6 arrest warrant for failing to honour payment of a Sh20million debt owed to a friend turned foe, Bryan Yongo.

Mr Jirongo had earlier agreed to pay the debt saying that he would give it priority after selling his 500 acres of land in Ruai, Nairobi, and another five acres in Kisumu. He was also expecting compensation from the Nairobi County government for a plot in Industrial Area. However, his failure to settle the debt prompted Mr Yongo to apply for a warrant of arrest against him.

The debt, rising from a loan of Sh12.7 million, has ballooned to Sh25 million. Mr Yongo informed the court that Mr Jirongo had more than 20 times failed to honour his part of the bargain.

“I cannot indulge him any more,” Mr Yongo told Deputy Registrar Elizabeth Tanui.

In his defence, the politician told the court that he had already paid Sh24 million and was left with a balance of Sh1 million. He said he needed time to file papers showing that he had actually been paying. But Mr Yongo would hear none of it.

The court on Tuesday slapped Mr Jirongo with a Sh5m cash bail which he failed to pay, leading to an overnight stay in police cells until Mr Wamalwa came to his rescue.

The debt owed to Mr Yongo is part of a series of complaints facing Mr Jirongo. The politician is similarly battling another debt of Sh100 million claimed by Central Organisation of Trade Unions Secretary-General Francis Atwoli.

Court papers show that Mr Jirongo received a Sh100 million friendly loan from Mr Atwoli in August 2016. He promised to repay the money in 50 days with an interest of Sh10 million. He failed to honour the deal and claimed that they had agreed that the amount would be recovered from money the Nairobi County owes him. Mr Jirongo said the county was supposed to pay his company, Kuza Farms and Allied Ltd, following a consent order recorded before the Environment and Land Court in July 2016 arising from a case filed in 2014. In his ruling, Justice Francis Tuiyot said the United Democratic Party leader was personally liable for the debt and cannot, therefore, shift liability to Kuza. The judge also observed that Mr Jirongo acknowledged that the sums were advanced to him and that he bore the responsibility of repaying a sum of Sh110 million on or before October 21, 2016.

“Mr Jirongo’s indebtedness was plain and obvious in the acknowledgment and undertaking of August 10, 2016. It was even more obvious and unequivocal when Mr Jirongo gave further undertaking of October 21, 2016. This court holds and finds that Mr Jirongo has admitted owing Sh110 million to Mr Atwoli and there can be no defence to that claim,” ruled Justice Tuiyot.

Mr Jirongo’s debt woes were also highlighted when he offered himself as a presidential candidate in the 2017 General Election. A former partner turned rival saw a perfect chance to hit back by filing bankruptcy proceedings against him.

Although the orders were granted, Mr Jirongo somehow managed to lift the orders and his name was on the ballot box. Justice Olga Sewe granted the politician temporary reprieve by lifting bankruptcy orders in a debt owed to businessman Sammy Boit arap Kogo, who was demanding Sh700m from him.

While lifting the orders, Justice Sewe gave Mr Jirongo a chance to argue the legality of the order. He also said the move would bar him from contesting the repeat presidential election.

Separately, the former MP lost property worth millions of shillings to auctioneers last year for defaulting on a loan amounting to Sh495 million. Valley Auctioneers sold 103 acres of land belonging to Kuza Farms and Allied Limited.

The firm, located in Chepkoilel, Uasin Gishu County and which has a salt processing factory, was sold for over Sh65 million which was the reserve price. The land was auctioned after Mr Jirongo lost a court case challenging a decision by the Central Bank of Kenya (CBK) to place his company under receivership for over Sh495 million owed to the collapsed Dubai Bank.

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