Saturday, July 2, 2022

How Royal Mabati has been scamming customers

Royal Mabati has not been so loyal to its customers. From delayed orders to substandard roofing sheets, the company has been facing a host of accusations of defrauding customers.

On May 17, 2022, Royal Mabati was ordered by the Competition Tribunal to comply with an order that was issued by the Competition Authority of Kenya to pay Sh. 2.6 million for misleading customers in what was equated to defrauding.

Royal had moved to the Competition Tribunal to challenge the penalty made by the Competition Authority of Kenya (CAK) on May 21, 2020.

“On various dates between March 2018 and March 2020, CAK received 13 complaints from customers of RML regarding the failure of or delayed deliveries and requiring customers to pay a delivery fee, despite advertisements indicating that the service was free countrywide,” the Authority said in a statement.

The manufacturing company also allegedly forced its customers to change order specifications post-purchase.

In addition to the monetary penalty, the roofing factory will be required to restitute the aggrieved customers through refunds within 60 days or free delivery of the products in 30 days.

“Royal Mabati is now required to refrain from running misleading advertisements and sensitize its Sales and Customer Care Team about the provisions of the Competition Act,” CAK said.

Royal Mabati’s managing director, Moses Ikinya Kang’arua, was also in September 2019 sued over business malpractices.

He denied 12 counts of charges, ranging from fraud in relation to tax to altering statements in income tax returns, omitting to declare income taxes and value-added taxes, under-declaring imports and substituting and removing goods in a bonded warehouse.

So how did Royal find itself in such a disloyal position?

One of the many accusations the company has been facing is delays in delivery of orders. For instance, a Silas Koech was reported to have placed an order for iron sheets and roll tops in April 2018 He was promised that they would be delivered in two days. He placed the order through but the order arrived after two weeks.

He then placed a second order on June 5, 2018. This time, his order was delivered after two weeks. Worse, what was delivered was not what he had ordered. He refused to accept the delivery and Royal Mabati said it would not return the products back to its factory which resulted in a stand off.

On August 17, 2018, Gilbert Owino placed an order for charcoal grey mabati. He was promised delivery would be done within 48 hours.

Several weeks later, Royal called him asking that he change the colour. He agreed. More than one month later, he had not received his iron sheets.

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“In all the above cases, Royal Mabati did not deliver the customers’ orders within the timelines provided. Royal Mabati aggravated the delay by remaining unresponsive to the complaints of its customers who were already in despair as they continued to suffer loss because of the delay,” the tribunal ruled.

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