Malaba — A gang of fraudsters have struck Malaba town with an ingenious idea; they set up an illegal bank, signed up customers, collected deposits – then vanished.
The Police in Malaba, which lies on the Kenyan border, say the con men opened a microfinance bank called Visa Finance two weeks ago and invited residents to sign up for accounts and loans.
About 204 people, whose files the Police have found, paid Shs10,000 each to open accounts in the bank, Shs10,000 for a passbook and Shs5,000 for ‘other’ charges.
An unknown number of other customers made unspecified deposits.
Many more customers, drawn to the new bank by local radio announcements and adverts promising quick unsecured loans (applicants had to deposit 25 per cent of the amount applied for up front) rushed to the bank.
By the time the ‘bankers’ vanished on Monday night, no loan had been disbursed. Authorities in the town are investigating how the con men were able to smile all the way away from the bank, and also trying to add up the losses suffered by local residents.
The ‘bank’s’ landlord, Mr Richard Ojore, was given a cheque of Shs9.8m as rent for one year; his bankers now say the cheque is fake.
The con men also left a Shs1m debt at Port Spring Villa Hotel which they raked up in meals and accommodation.
The hotel manager, Mr Albino Otabong, who is also the LC2 chairman, said: "This was a first-class gang of people. They have defrauded people a lot of money and have also stayed in the most executive places in the area free of charge." He added: "We just need to forget all about it and be extra careful next time."