Broke Firm’s Deception Exposed: Jasir Contractors Loses Sh2B Housing Tender

In a stunning revelation of corporate dishonesty, Jasir Contractors, a firm so cash-strapped it couldn’t settle a mere Sh1.8 million debt, has had its questionable Sh2 billion affordable housing contract revoked after a procurement board uncovered what appears to be a web of deception and preferential treatment.

The Public Procurement and Administrative Review Board (PPARB) canceled the lucrative Loitoktok, Kajiado County housing tender awarded to Jasir in January, following revelations that the company misrepresented its financial capacity while the State Department for Housing deliberately overlooked “glaring alterations” and “multiple inconsistencies” in the company’s bid documents.

Too Broke to Pay, Rich Enough to Build?

Court records paint a damning picture of Jasir Contractors’ true financial state. While pursuing a multi-billion shilling government contract, the company’s director, Jasper Ireri Mbungu, was simultaneously pleading poverty in court to avoid paying creditors.

“The 1st defendant [Jasir Contractors], being the principal judgment debtor herein, has been having financial challenges,” court documents reveal. So dire was the company’s financial situation that Mbungu was jailed for 30 days until January 5, 2024, for failing to pay a Sh1.8 million debt to Aakash Limited.

After his release, Mbungu promised to make monthly installments of Sh75,000 – a commitment the company failed to honor, resulting in another arrest warrant that Mbungu has only escaped through a High Court injunction.

A Pattern of Financial Deception

The financial troubles don’t end there. The Kenya Revenue Authority (KRA) successfully pursued the company for Sh4.2 million in unpaid taxes linked to undeclared supply deals worth Sh109.9 million with Meru County Investment and Development Corporation between 2017 and 2021.

Despite these glaring red flags that should have disqualified Jasir Contractors during financial evaluation, the State Department for Housing awarded them the Sh2.179 billion tender on January 24, 2025 – raising serious questions about the integrity of the procurement process.

Unfair Advantage Exposed

The PPARB investigation revealed that the housing department unfairly disqualified competing bids, including one from Jijenge Precast and Construction Ltd that offered to complete the project for Sh63 million less than Jasir’s bid.

“The evaluation report did not justify as to why the successful bidder’s errors, alteration, omissions and commissions were overlooked while the applicant’s bid was deemed non-responsive for lesser discrepancies,” the PPARB stated, accusing the housing department of failing to uphold “principles of fairness, transparency, and equal treatment.”

The apparent favoritism shown to a company with documented financial problems has cast a shadow over Kenya’s ambitious affordable housing program, which aims to build over 250,000 homes annually and is partially funded by the controversial 1.5 percent housing levy deducted from Kenyans’ salaries since July last year.

Questions of Cronyism

Industry insiders question how a little-known firm registered in 2014, with a history of debt problems and tax evasion, could have been entrusted with a project that requires substantial upfront capital investment.

This case follows another controversial award to MHOA Africa Limited, owned by Harun Aydin, a Turkish businessman with close ties to President William Ruto who was previously deported from Kenya in 2021. These patterns have fueled growing concerns about possible cronyism in the allocation of lucrative housing contracts.

For now, the PPARB has ordered the State Department for Housing to readmit and review the previously disqualified bids, but the damage to public trust in the procurement process may prove harder to repair than any housing deficit.

As millions of Kenyans continue contributing to the housing levy, many are left wondering: Who is really benefiting from Kenya’s affordable housing program?