Saturday, April 13, 2024

Mugo Mungai: The billionaire who lost his two banks to the government

The late businessman Mugo Mungai was a Kenyan banker who died fighting for his hard-earned wealth.

The businessman who rested in January 2024 after a short illness owned strings of businesses, including financial institutions and acres of land.

Born in Kanyariri in Kabete, Mungai had first trained in shorthand and worked as a stenographer.

He joined the job market in 1959 working as a secretary to Kimani Ngumba, who would later rise to become Nairobi Mayor and a banker.

In 1978, he registered the first financial institution under his name, marking the beginning of his journey as a player in the banking sector.

“Before I registered Pioneer Building Society in 1978, my only competitor was the East African Building Society. There was no other operating at that time,” he says.

East African Building Society was owned by the late Kenyan billionaire Lalit Pandit who founded it in 1959.

Soon after Ugandan President Yoweri Museveni ascended to power, Mungai flew to Uganda looking for opportunities in the banking sector.

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He wanted to open a new branch of his Pioneer Building Society and Capital Finance. Things, however, took an unexpected turn when then-President Daniel Moi learned of Mungai’s visit to Uganda.

Moi was suspecting that Libyan leader Muammar Gaddafi and Museveni were working against him.

He was also afraid of Mount Kenya tycoons, whom he thought were controlling the national politics. It was after the visit that Mungai’s woes began.

Upon his return, the then 44-year-old businessman was grilled by officers of the Criminal Investigation Department who questioned him whether his Uganda trip was a gun purchase mission.

“I didn’t know that I was a marked man,” Mungai said, adding that the timing of his visit to Uganda was wrong as he lost all his banks and properties.

Mungai’s banks were locked in November 1986 despite them having zero financial troubles. He took the matter to the court in what would be a lengthy legal battle.

“My bank was never in trouble,” Mungai said.

Before the seizure, the businessman owned Capital Finance Limited and Pioneer Building Society, which he founded at 36.

He also owned Pioneer Estate, which had 259 maisonettes in Nairobi and Capital House in the City center.

Mungai also had 50 half-acre plots in the up-market Gigiri, near Unep, Nairobi. He, however, died while still fighting for these properties estimated to be worth billions of shillings.

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