Former Jubilee Party Secretary General Raphael Tuju has defended a near Sh1 billion funding deal, insisting that the project followed proper procedures and underwent thorough scrutiny before approval.
Speaking on NTV on Tuesday, Tuju said the financing, facilitated through the East African Development Bank, was based on a formally prepared project document that was vetted both internally and externally, including audits by KPMG.
“You cannot get close to a billion shillings just like that. It has to be based on a project document,” he said, noting that he personally hired consultants to confirm the project’s viability.
The funding, Tuju explained, was meant to support a hospitality venture, including the construction of 15 to 20 villas, which would generate revenue to repay the loan. He added that there was already clear demand for the development, with prospective buyers, including regional figures, showing interest and paying deposits even before full disbursement.
Tuju alleged that tensions with the lender arose after the initial disbursement was made directly to the land vendor. He claimed that some bank officials introduced new conditions that were not part of the original agreement.
“All of a sudden, they tell you they would be more comfortable if you give us additional securities… I’ve already given you more than enough,” he said. He further accused the officials of attempting to benefit personally from the situation. “Blackmail is that before we disburse… how can we become partners in this business?” Tuju added, saying that these demands led him to resist providing further collateral.
According to Tuju, the securities he had already submitted, including multiple properties valued at over Sh1.5 billion, were adequate under standard lending ratios. He argued that the initial disbursement itself showed that the bank was satisfied with the collateral at the time.
The dispute has now escalated into a legal battle, with Tuju revealing that some EADB officials are facing criminal charges for allegedly filing false statements in court. He dismissed claims of diplomatic immunity as “nonsense,” stating, “There is no way by which you can have diplomatic immunity on a criminal charge… criminal is criminal.”
The East African Development Bank responded on Monday, calling Tuju’s claims “grossly misleading” and asserting that the loan process adhered to all legal and contractual requirements. The bank said the $9.1 million facility to Dari Limited was fully secured with charged properties before disbursement and later went into default, prompting lawful recovery actions.
It added that all enforcement steps, including court proceedings and the auction of secured assets, followed the facility agreement and court rulings. The bank rejected allegations of wrongdoing or coercion, maintaining that the process was fully legal.
The matter remains before the courts as both sides continue to contest the circumstances surrounding the funding and subsequent fallout.
