How UK Court Exposed SportPesa’s Sh42 Million Share Fraud Then Let Culprits Walk Free

Judge documents lies, perjury and conspiracy involving wanted criminals but delivers verdict that lets perpetrators keep stolen empire

A London judge spent three weeks meticulously documenting what he called a sophisticated web of lies, fraud and perjury orchestrated by Bulgarian directors with alleged criminal backgrounds, only to deliver a baffling verdict that has left legal experts questioning whether British justice failed spectacularly when confronted with organized crime.

Justice Edward Johnson of the High Court of Justice caught SportPesa Global Holdings Limited red-handed violating company law, documented directors committing perjury under oath, exposed a systematic scheme to defraud Kenyan investor Paul Ndung’u of shares worth hundreds of millions of shillings, yet still ruled against the victim in a November 2025 judgment that reads like a masterclass in judicial contradiction.

The case has exposed not just corporate fraud but the murky underworld behind one of Africa’s most recognizable betting brands, a world populated by Bulgarian nationals investigated for credit card fraud, racketeering, kidnapping and money laundering, men who turned Kenya into their personal criminal enterprise while sponsoring football clubs and posing as philanthropists.

At the center of this empire stands Guerassim Nikolov, a man Bulgarian investigative journalists have linked to gangland figures, credit card skimming operations and a 1994 kidnapping of Serbian truck drivers at gunpoint. According to Bulgaria’s National Security Agency, Nikolov is one of the main organizers of credit card draining operations worldwide. He fled Bulgaria in April 2000, just months before criminal charges in the truck driver case were finalized in court.

Yet this is the man who controlled SportPesa, sponsored Arsenal and Everton football clubs, and presented himself as a respectable businessman while systematically stripping Kenyan shareholders of their stakes through what a British High Court judge found to be deliberate violations of company law.

The London trial heard how Nikolov and his co-director Kalina Lyubomirova Karazhova, sister of another Bulgarian director who goes by the Americanized name Gene Grand, orchestrated a rights issue specifically designed to exclude Ndung’u from exercising his pre-emption rights. The execution was surgical in its precision and brazen in its illegality.

They sent offer letters to an address in Kenya that appeared nowhere in the company’s official register. They dispatched electronic offers to an email domain that the Communications Authority of Kenya had already shut down for fraud. The CAK’s July 16, 2019 notice stated plainly that the SportPesa domain was being used to defraud unsuspecting members of the public.

While other shareholders received phone calls alerting them to the rights issue, Ndung’u’s phone never rang. The offer letters arrived at his actual address only after the subscription deadline had expired. By then, his 17 percent stake had been diluted to 0.85 percent, and the Bulgarian directors controlled 90 percent of the company that was generating revenues exceeding Sh150 billion annually from its Kenyan operations.

Justice Johnson found that SportPesa Global Holdings Limited breached sections 561 and 562 of the UK Companies Act 2006, laws specifically designed to protect shareholders from exactly this kind of predatory dilution. The company admitted to a second breach during the trial. These are not minor technical violations but fundamental protections at the heart of British company law, violations that in any rational legal system would result in the reversal of the fraudulent share issue and substantial damages.

Instead, Justice Johnson performed a logical somersault that has left the legal community in disbelief. The court ruled that Ndung’u could not have afforded the £170,000 needed to take up the shares, therefore he suffered no loss. This finding directly contradicted bank evidence that Ndung’u had submitted showing he had access to over £896,000 through various accounts and facilities.

Court records showed Ndung’u maintained a standing overdraft of Sh50 million, approximately £416,000. His personal account held Sh60 million. His business account contained over Sh100 million. By early 2023, he had already spent more than £300,000 pursuing the case and had committed in writing to invest up to £500,000. Dr Ekuru Aukot has notified the Court of Appeal that Ndung’u is owed £2.4 million in cash he invested in SportPesa Holdings Limited in the Isle of Man between 2016 and 2017.

The judge’s reasoning inverted the burden of proof in a way that corporate fraud experts say creates a dangerous precedent. The defendants who committed the fraud were not required to prove Ndung’u lacked funds. Instead, the victim was expected to anticipate and preemptively rebut an argument never raised during the proceedings.

But the fraud itself, as damning as it was, represents only the surface of a criminal enterprise that spans continents and decades. The trial exposed far more than a disputed rights issue. It pulled back the curtain on a Bulgarian criminal network that had successfully infiltrated Kenya’s betting industry, laundered billions of shillings, violated tax laws with impunity, and when finally confronted by British justice, simply lied under oath.

Justice Johnson found that SportPesa Global Holdings Limited had violated UK accounting requirements by failing to prepare audited consolidated accounts. The company did not qualify for small company exemptions because its balance sheet exceeded statutory limits and the group employed more than 50 people.

Ndung’u, as chairman, had appointed KPMG as auditors. The Bulgarian directors claimed KPMG was too expensive and difficult to work with. They testified under oath that KPMG had advised them to prepare accounts under a regime that does not require audits, a convenient claim that would have absolved them of legal obligations.

Justice Johnson investigated. He found no written record of such advice from KPMG. He found no record of any board meeting where the matter was discussed. In paragraph 677 of his judgment, the judge concluded the directors had committed perjury, the criminal offense of lying under oath in a court of law.

The significance of this finding cannot be overstated. A High Court judge does not lightly accuse witnesses of perjury. Yet having made this finding, Justice Johnson did not refer the matter to prosecutors. The directors who lied under oath walked out of court with their 90 percent stake intact, their criminal conduct documented but unpunished.

During cross-examination, the defendants admitted to more than 20 breaches of statutory obligations. They characterized these violations as inadvertent mistakes made unknowingly. The pattern of breaches, combined with the deliberate misdirection of offer letters to phantom addresses and disabled email accounts, combined with the documented perjury, tells a different story. This was systematic criminal conduct by individuals with alleged histories of exactly such behavior.

The defendants attempted to reframe the dispute as Kenyan investors trying to push out foreign shareholders, playing the race card to distract from their documented violations of law. The evidence demolished this narrative. The conflict centered on how the Bulgarian directors passed resolutions and spent company money without full board approval, fundamental breaches of corporate governance that any director, regardless of nationality, has a duty to prevent.

Justice Johnson noted that cases involving deliberate shareholder dilution through breach of pre-emption rights have no precedent in UK courts. The judge described the case as containing convoluted facts, outright lies, fraud and perjury that the court found strange and mysterious. In paragraph 313, he acknowledged that some forgery allegations were beyond the scope of the case, stating there was no means of investigating certain claims because they fell outside the proceedings.

This admission raises disturbing questions. What other evidence might have emerged had the court’s investigative scope been broader? What other crimes might be documented in the files that Justice Johnson felt he could not examine?

The UK trial followed explosive developments in Kenya that further illuminate the criminal nature of the enterprise. In April 2025, just weeks before the London proceedings began, the Kenyan Court of Appeal overturned its own February 2023 ruling after discovering it had been misled by a forged court order. The appellate court cited the intricacies of fraud and forgery in its reversal, language that suggests the court recognized it had been the victim of a sophisticated criminal operation.

The discovery prompted the Kenyan judiciary to issue a public notice warning about criminal activity involving the forgery and misuse of court documents. The Court of Appeal ordered that Ndung’u be included in all matters relating to Pevans East Africa Limited, recognizing that he had been systematically excluded from decisions affecting his investment.

The SportPesa saga traces back to July 2019 when the Kenyan government shut down Pevans East Africa Limited and deported its Bulgarian directors. Then Interior Cabinet Secretary Fred Matiang’i pulled no punches in his assessment, accusing them of committing heinous crimes in their own country and doing things they could not do in Bulgaria. The closure and deportations were extensively covered by the Financial Times and The Guardian, major international publications that documented the scale of the operation.

Matiang’i’s crackdown followed a Sunday church service attended by President Uhuru Kenyatta where Bishop David Oginde questioned why the president was comfortable leading a country of gamblers. The ensuing investigation revealed devastating statistics. More than 500,000 youth aged between 18 and 25 had been blacklisted by the Credit Reference Bureau after borrowing money to gamble and losing. Teen suicides linked to gambling debts were rising. The average gambler earned between Sh5,000 and Sh10,000 per month but was losing far more to betting firms.

After the shutdown, the core assets of Pevans including M-Pesa paybills and funds were transferred to Milestone Games Limited, which now operates the SportPesa brand in Kenya. Court documents allege that Sitoyo Lopokoiyit, now Chief Executive Officer of M-Pesa Limited, a Safaricom subsidiary, orchestrated transfers exceeding Sh2.3 billion in defiance of High Court preservation orders that had frozen all Pevans accounts.

Dr Aukot has accused Lopokoiyit of violating conflict of interest rules because he is married to the sister of Ronald Karauri, SportPesa’s Kenyan CEO and a key figure in the network. The alleged transfers happened while court orders were in full force, raising explosive questions about how such massive movements of funds could occur in violation of judicial orders and whether corruption within Safaricom enabled the scheme.

Neither Safaricom nor Lopokoiyit has publicly addressed these allegations, a silence that speaks volumes given the gravity of the accusations and the documented court orders that were allegedly defied.

Milestone Games Limited is owned by a complex structure including Commtech Limited with 25 percent, small shareholdings held by lawyers Deborah Linet Ontiri and Peter Jr Okaalet, and a 72 percent stake controlled by TPLC Holdings Limited, a UAE Free Zone Establishment owned by the Bulgarian nationals. The structure effectively allowed the Bulgarians to continue controlling the SportPesa brand and revenue stream in Kenya despite their deportation, despite the criminal allegations, despite everything.

The Bulgarian operation in Kenya was never just about betting. According to investigative reports, Nikolov’s business partner in the earlier Toto 6/49 lottery was Krasen Tenev, a Bulgarian who fled his country after police discovered his printing business had been producing hundreds of thousands of fake excise labels used to avoid tax on imports and exports. Tenev lived in Nairobi under an assumed Ukrainian identity as Fyodor Koval until Bulgarian journalist Slavi Angelov tracked him down.

Tenev was later found guilty of five counts of forgery in Bulgaria and sentenced in absentia to 11 years in prison. He remains on Interpol’s Red Notice watchlist. Yet he was Nikolov’s business partner in Kenya, operating lottery operations while wanted for major fraud offenses in Europe.

In January 2006, Bulgarian police investigating a credit card skimming syndicate traced Boyan Petrakiev, nicknamed The Baron, to Nairobi. Petrakiev was the gangland kingpin who led the 1994 attack on Serbian truck drivers, the same incident in which Nikolov was allegedly present, questioned and charged but never tried. Petrakiev later told Buzzfeed News he had casino interests in Kenya and was also a partner in an arms dealership contracted by the US government to send small arms to rebel groups in Syria.

This is the network that controlled SportPesa. Wanted criminals, forgers, alleged kidnappers, credit card fraudsters, arms dealers. Men who sponsored Arsenal and Everton, who donated to charities, who presented themselves as respectable businessmen while building an empire on fraud, money laundering and systematic violation of laws in multiple jurisdictions.

Bulgarian MEP Slavi Binev, who visited Kenya in March 2014 to celebrate SportPesa’s launch, described Nikolov as one of his best friends and praised him as a capable Bulgarian driven abroad. Binev himself had been one of the main shareholders in R-System Holding AD and was later appointed Chairman of Bulgaria’s Parliamentary Committee for Culture and Media, triggering outrage among Bulgarian intellectuals who saw him as a promoter of chalga music through his former nightclubs.

The connections between Bulgarian organized crime figures, politicians and the SportPesa operation suggest something far more sinister than simple corporate fraud. This was an international criminal enterprise that successfully penetrated Kenya’s financial system, corrupted officials, forged documents, violated court orders, and when finally confronted in a British court, simply lied and walked away with the proceeds.

Financial analysis of Pevans East Africa’s 2018 statements reveals the scale of the money laundering operation. In that year alone, punters were placing bets of about Sh12.4 billion monthly, approximately Sh400 million daily. Total bets received added up to Sh149.7 billion. From operating reserves of Sh15.2 billion, one-third or Sh5.3 billion was paid to related parties offshore.

Of this, Sh1.4 billion went to companies wholly owned by Valentina Mineva, Nikolov’s sister. Both Mineva and Nikolov received generous personal benefits from these outflows. Tech Pitch Limited paid Nikolov a director’s remuneration package of Sh196 million in 2018 despite the company’s entire wage bill being booked as Sh19.4 million, an accounting impossibility that screams fraud.

Money flowed to SPS SportSoft Ltd in the UK, Kentech SL in the Canary Islands, Peg B Technology FZE in Dubai. The network of offshore entities in tax havens allowed the Bulgarians to extract billions from Kenya while paying minimal taxes anywhere. In the UK, despite sponsoring major football clubs, SportPesa used white label systems allied to companies registered in the Isle of Man, meaning no SportPesa company appeared to pay UK corporation tax on gambling revenues.

Dr Aukot has characterized the case as one that will be studied in Western law schools for years to come, not as an example of justice served but as a cautionary tale of how organized crime can be meticulously documented yet go unpunished when perpetrators have access to sophisticated legal resources and proceeds of money laundering.

The judgment raises profound questions about the enforcement of corporate law and the prosecution of international criminal enterprises. If a court can find that a company broke the law, that directors committed perjury, that shareholders were deliberately defrauded, yet still rule in favor of perpetrators with documented links to organized crime based on a contested assessment of the victim’s finances, what protection do minority shareholders actually have? What deterrent exists against criminal enterprises using corporate structures to legitimize their operations?

Justice Johnson’s decision not to award damages or refer the perjury to prosecutors has created what legal observers describe as a dangerous precedent. Companies facing allegations of share dilution now have a roadmap provided by a British High Court. Breach pre-emption rights, send letters to phantom addresses, lie about it under oath, and argue the victim could not have afforded the shares anyway. Even if the court finds against you on every substantive point, you might still walk away with the stolen assets.

The late Nairobi Mayor Dick Wathika, who originally invited Ndung’u to invest in SportPesa, died in December 2015 shortly after attending a business meeting with the Bulgarians at their Finix Casino in Hurlingham. He had confided in friends that he felt sidelined from company decision making. His widow Asenath Wacera inherited his stake and has watched as the Bulgarians consolidated control through the very fraud Justice Johnson documented.

Ndung’u has until January 28, 2026, to lodge his appeal papers. The Court of Appeal will have to grapple with contradictions that make this case so explosive. How can British justice reconcile a finding of fraud with a refusal to provide remedy? How can a judge document perjury by individuals with alleged criminal backgrounds then take no action? How can bank evidence showing nearly £900,000 in accessible funds be dismissed without explanation? How can the court ignore the broader context of an international criminal enterprise?

The Bulgarian directors, Nikolov, Ivalyo Bozoukov and Karazhova, emerged from the three-week trial with their 90 percent stake secure. Ndung’u, despite the court’s findings in his favor on multiple points of law, was left with 0.85 percent and an invitation to appeal. The criminals documented by Bulgarian police, investigated by security agencies, deported by the Kenyan government, caught lying by a British judge, control a betting empire worth billions.

For British corporate law, the case poses unsettling questions about what happens when the mechanisms designed to protect investors encounter organized crime. For Kenya, it confirms what many suspected, that SportPesa was never a legitimate business success story but a criminal enterprise that exploited weak regulation, corrupt officials and sophisticated offshore structures to launder money while destroying lives through gambling addiction.

As the appeal process unfolds, legal observers will be watching to see whether the Court of Appeal can untangle the contradictions in Justice Johnson’s judgment or whether this will stand as a troubling example of justice catching organized crime in the act, documenting its methods, exposing its lies, then letting it walk free with the proceeds. The answer will determine whether British courts can effectively confront international criminal enterprises or whether such organizations can simply lie their way to victory when their frauds are exposed.