Betting board shuts the door on SportPesa return
The return of SportPesa has been met by another major setback after the Betting Board followed through with its threat and cancelled the licence of a new company that the firm had plotted to use to re-enter the market.
The Betting Control and Licensing Board (BCLB) accused Milestone Games Limited, which is the new front for Sportpesa, of obtaining its licence under one set of owners, only to later transfer its shareholding to another entity, thereby circumventing the board’s due diligence requirements on betting company ownership.
Owners of Milestone appeared before the board on Thursday to defend themselves against the accusations, but the board in its ruling said it was not satisfied and went ahead to cancel its licence.
This means that SportPesa will now have to cease its operations just days after it returned.
In the decision seen by the Nation, BCLB chairman Cyrus Maina said that when Milestone applied for its bookmaker’s license, its shareholders were Nob Five Limited (9950 shares) and Wilson Ngatia Karungaru (50 shares). At the time, Nob Five was owned by John Munene Nderitu (250 shares), Jackline Nyambura Kungu (500 shares) and Joseph Muendo Mutua (250 shares).
As a requirement for licensing, Milestone paid Sh200,000 on September 17, 2020 for due diligence investigations on its directors at the time, an act that was done and the board was satisfied that they were indeed fit and proper to hold a bookmaker’s license.
James Muigai Ngengi was the addressee in between correspondence between Milestone and the regulator.
But immediately it got the licence, a new company, Selenium Limited, emerged on its shareholders roll.
Selenium Limited is owned by Mr Karauri, the Sportpesa chief executive, alongside Francis Waweru Kiarie, another Pevans shareholder. This allowed owners of the SportPesa brand to beat the board’s due diligence requirements and get back in the game.
“Having considered the foregoing, the Board was not satisfied with the explanations proffered by your company and accordingly arrived at the decision to cancel your company’s bookmakers off-the course license number 0000205 dated 6th October 2020,” BCLB ruled.
If Sportpesa had gotten its way, it would not have needed to change anything to get back in the game. Not even its CEO, office address, or gaming and payment infrastructure — since they are one and the same thing.
This comes days after the High Court allowed Pevans to once again access its bank accounts and paybills, upsetting the Kenya Revenue Authority (KRA).
The taxman sought to have the company’s bank accounts frozen to allow it to investigate allegations of tax evasion schemes.
The firm has also been accused of sucking profits out of its lucrative Kenyan business by paying millions of pounds to a software company it owns in the UK – an arrangement that has significantly reduced its tax bill.