An Email forwarded by FEP Diaspora representative to me states, â€œAs the financial year comes to a close, FEP Holdings Ltd together with Credit Bank have announced a PPO process on the road map to acquire substantial control of the bank.â€ Before we talk about Credit Bank, the CEO of FEP should first account for the billions of shillings he has collected from Diaspora since 2011. Diaspora FEP investors should not this time around invest blindly. The fact that the Credit Bank reported a loss of (Kshs 91 million) in 2014 and in 2015 reported a loss of (Kshs 196 million) should make Diaspora pause.
As a Diaspora person who invested in FEP and has never received any details of what my money did; Iâ€™m not surprised that FEP CEO thinks Diaspora money is earned easily. For Diaspora to be able to progress, they now need to use their intellectual capital to protect the cash capital they earn from hours of hard work.
Whereas the expansion of Credit Bank is a noble cause; this should not be used by the FEP CEO to hide the unresolved issue of billions of shillings Diaspora put inside FEP that remains undisclosed and unaccounted for. Myself and thousands of Diaspora Kenyans who put in billions of shillings into FEP through shares of Kshs 200,000 to even more than Kshs 600,000 each have yet to know what their money did or is doing.
In the Credit Bank offer, I was surprised to notice some of FEP capital was recently invested to buy 5% share capital of Credit bank. This means my money and thousands in Diaspora money held by FEP was invested to make 5% of the (Kshs 196 million) reported loss by Credit Bank or our capital incurred (Kshs 8.4 million) loss.
The Kshs 8.4 million loss interpreted in another way means, â€œThe best investment the CEO of FEP can achieve with investorâ€™s money is an investment of their money to make loses.â€ This of course is understandable for this guy has never stood on concrete floors for 16 hours and felt the pain of hard work in his body as many Diaspora experience every day as they work to earn the money he is now recklessly wasting.
As a shareholder of FEP, I did not know that FEP had invested in the Bank before I read this offer. I wonder how many of those in Diaspora in FEP whose money was invested did not know. The Board of Directors of a company most important responsibility is to keep the shareholders who funded the company informed of any investments and plans they intend to apply the capital of shareholders.
Bernard L. Madoff pyramid scheme that was exposed in 2008 and destroyed many families in the U.S as millions of dollars were lost did not start as a Ponzi scheme. It turned to a Ponzi scheme when Madoff started to lie and not disclose to investors the truth. The fortunate thing is Madoffâ€™s incident in the USA was challenged legally and this rotten man who lied to the innocent people who had entrusted him with their money was put to jail.
The articles and letters I have read on FEP, including the one pasted below, follow the same traits. FEP CEO has denied the Diaspora investors (Shareholders) their right to know what their money is doing. The fact that legal system in Kenya is today not able to fully detect and deter Ponzi schemes leads to those involved going scotch free as they continue to flourish from ill-gotten wealth from othersâ€™ sweat. Remember the Pyramids schemes in Kenya a few years ago that were schemed by some folks and outstanding Church leaders/Bishops that destroyed so many innocent lives?
For those of us Diaspora in FEP, the only way to ensure the FEP CEO does not lead you to having an economic depression is to educate yourself. Secondly, the Diaspora in FEP should join together to ensure our capital is not lost. Thirdly, Diaspora should stop funding scripted speeches that promise them heaven and once money given, it is never accounted for. Many of us put our credibility online to introduce our friends to FEP in good faith which was trashed by FEPâ€™s shrewd maneuvers. Today when I talk to Diaspora Kenyans who tell me they sent thousands of their cash to FEP and have no accounting documents to show for their money, this appalls me.
Now, and without shame, the FEP CEO comes in a rush asking thousands in Diaspora (inside FEP) to open their wallets to invest Kshs 5.4 billion through buying 30 million shares at Kshs 180. Those of us in Diaspora are expected to accept that the civil case Nyanza spinning and weaving mills limited verses Credit Bank that seeks damages for Kshs 2 billion form Credit Bank will not be awarded Kshs 2 billion. The explanation by the PPO experts that the worst case scenario is the liability cannot exceed Kshs 150 million explains that Credit Bank did something they think they could pay Kshs 150 million. The Diaspora should understand that if a court can make a ruling of Kshs 150 million so can it rule Kshs 2 billion.
The FEP CEO did not organize the Diaspora to invest their money in Kenya. The Diaspora opened up their resources and organized themselves hoping he was a great trustworthy entrepreneur. Many of us liked that he had the guts to try and had conviction, which are the trademarks of entrepreneurship. However, the flow of cash likely turned him to become this person who hungers for more cash. This is similar to a good worker who is employed in a brewery who rather than ensure a production life runs smoothly ends up spending more time drinking the beer from the production line.
Investing in Credit Bank is not a bad idea for Diaspora in FEP. The only bad idea is that this investment is been used as a gimmick to wipe away or hide what many have been complaining about FEP since investing their hard earned cash. Diaspora in FEP can protect their capital through a (Diaspora in FEP registry,) that establishes Diaspora persons in FEP and the capital invested in FEP in a registry.
On Investment in Credit Bank, Diaspora in FEP should inject their capital through a system like the one that happened in the Equity Bank capitalization of 2007 when â€œHelios Investment fund,â€ invested $178.7 million dollars (about Kshs 12 billion.) The Kshs 12 billion Helioâ€™s Fund invested in Equity Bank was represented by two professionals who took two seats in the Equity Board of directorâ€™s. These arrangement is part of the great story that has led to Equity Bank growth from a bank that reported profits of Kshs 1 billion 2006 to one that reported profit of Kshs 24 billion in 2015. This is because the investorâ€™s capital performed profitable work and was not wasted.
Since 2011 thousands in Diaspora who became FEP investors have spent thousands of hours complaining, pondering and agonizing on the decision to invest in FEP. Today I doubt the Diaspora money in FEP has gone to profitable work, for if it had, the complaining and anger would not be there. Indeed I would not be surprised if after the (Diaspora in FEP Registry) is created we find out that most of this money was wasted funding, â€œThe global sale of FEP shares,â€ rather than financing profit generating ventures.
Credit Bank 2015 made a loss of (Kshs 196 million). Credit Bank in 2014 reported a loss of (Kshs 91 million). Credit Bank is currently sued for Kshs 2 billion. Diaspora in FEP are now been hoodwinked to jump blindly without knowing the protective pillars to secure their capital from the growing loses the bank is incurring that currently total Kshs 287 million or secure their capital from been used to pay a verdict as high as Kshs 2 billion. Diaspora in FEP should remember the story on Lehman Brothers Holdings Inc., a global financial services firm that collapsed after 158 years. They should ask: Why is Credit Bank making loses?
It is time Diaspora in FEP understand that the only way the Diaspora have a chance to protect their money in the investment of Kshs 5.4 billion ($54 million) is through having competent Diaspora representations protect this capital just like the Helios fund of $178.7 million invested in Equity Bank 2007 was protected by two competent representatives.
The first step the Diaspora in FEP should do is establish a (Diaspora in FEP Registry) that defines them and their collective capital injected in FEP. This registry will enable Diaspora to salvage the little money left inside FEP. The second step is to get the professionals from Diaspora to represent their investments in Credit Bank if the Diaspora professionals deems it a sound investment venture.
Diaspora, should not bite at the bait of these pleasurable promises advanced through media hype till we know there is no hook beneath (the bait). The hook can be buying somebody a pristine lifestyle while you in Diaspora is forced to live in dust of slavery by these upcoming business styled â€œNiccolo Machiavellisâ€.
Diaspora work hard. Each of us should protect the sweat of our brow and our intellect. It is time that Diaspora used their intellect to protect their hard-earned cash capital.
If you joined FEP and are currently residing in the Diaspora please register by emailing Your Name, Town/City & State residing, amount invested and phone no to firstname.lastname@example.org
You shall be informed the next steps.
By Dr. Daniel Kimethu. The write is a FEP shareholder based in Columbus, OH.
Please Read Letter sent by Diaspora to FEP Board referenced on Article.
The Board of Directors
Fountain Enterprises Programme P.O BOX 72367-00200
Dear Members of the Board of Directors,
SUB: FEP GROUP OF COMPANIES 2015 INVESTOR PROMISE.
We are writing to you on behalf of numerous leaders and investors located in the diaspora who have come together in unity longing to voice their concerns. As you are aware, the group CEO had engaged several of us in the diaspora in the initial stages of FEP. Most of us embraced the vision especially after considering the representation within the board which contains very reputable and honorable individuals in the Kenyan society.
However based on numerous reports and observations from many of plus several of the investors we helped recruit, there is growing concern that our investments are not being represented appropriately. For this reason, we wish to bring several concerns from the USA diaspora leadership and also from other FEP investors view.
Majority of the core leadership here in the USA joined FEP in 2011 when the company was selling Tier II ownership shares. As a result, many of us have a rich history of the company and have played key roles here in the diaspora especially on recruiting many new investors. This effort comes with countless hours and other monetary resources all geared towards making FEP successful and facilitate the maturity on the promised returns. We put our reputation on the line and have continuously done so up to this point.
On a sour note, we have been left wondering why several promises and requests have gone unanswered. Some of these grievances date back from 2012 when several of us were tasked with selling Tier III shares and recently the PPO. We were made to believe that our efforts will be compensated and expenses reimbursed only to be left on a never ending trail of promise after promise. Every day for the past 4 years our reputation has been tested as we engaged and decided to stand in the gap of many common investors fighting and defending the companiesâ€™ integrity, promises and vision. We have continuously suffered and had setbacks after failed lack of proper communication from the head office on updates about the companyâ€™sprogress, investments and financial health. This frustrating view has been shared by the many investors we recruited and because of the managements lack of communication, investors are left with the only option they have available of relying on hearsay and unconfirmed stories received from several sources as listed in the attached detailed Addendum letter.
The FEP membership and investor representations in the USA is the largest outside Kenya with that number currently knocking on a membership of 7,000+ members. These members, many of them who are FEP investors at different ownership levels relied on our representation and information provided to them to make their investment decision. It is with these that many feel that they are owed due diligence as owners for their investment which includes updates on how the company is performing, share certificates as well as title deeds for those who purchased land.
However, this has not been the case as most of the investors have relayed story after story on how they have been taken on a spin. Some have cited misrepresentation of facts to the point of being coerced to invest their money into nonexistent projects. Majority of them have not received their certificates for the shares they purchased in 2012 and title deeds for land procured several years ago. Many claim lack of responsibility within FEP leaving them regretting why they engaged. Some have also cited feedback from their friends and loved ones in Kenya on numerous mismanagement episodes within FEP. (See attached addendum for details).
Because of this, many investors are seeking answers and have urged us to put the same effort as we did to recruit them into FEP and not to leave them hanging. After several considerations, consultations and professional advice we decided to present our case and involve the board since most of this frustrations hinge around the management of the group of companies. We therefore request for your audience so that we can try and tackle some of these incidents many refer to as injustices within FEP. Listed Below is the feedback we are seeking:
- Current audited financial report for 2014/2015
- Updates on Lukenya properties. The cost value, number of plots sold and current market value
- Names of investors were forwarded through our County Chairmen. When do we get share certificates for tier 2, Tier 3 and PPO?
- Number of companies owned by FEP, how many are in operation and status of those out of operation
- Percentage of ownership and any MOU for any existing partnerships
- Updated PPO report, amount raised and what is the next plan of action?
- What happened to FEP Bank and the 40% of founder shares allocated to banking according to CEOâ€™s presentation.
- When will FEP honor the leaderâ€™s remuneration package as outlined by the CEO in 2012? Some leaders have never been compensated for expenses incurred on travel, hotel reservation and other related cost. Does FEP have any plan to reimburse these expenses and how do they plan to do it in future?
In our last leadersâ€™ conference meeting held last month, there was a general consensus that there is a need for Diaspora to issue a press release on issues circulating around about FEP and unkept promises. Before we take this course of action, we would appreciate if the board can provide an honest feedback by July 15th, 2015. Meanwhile we will not campaign or promote any FEP products before all these concerns are addressed.
OKOA FEP SOLUTIONS TEAM
- George Njue, North Carolina
- Bernard Ngigi, Oklahoma
- Isaac Mwangi, Oklahoma
- Geoffrey Soyiantet, Missouri
- Geoffrey Kiama, Missouri
- Paul Kamau, Texas
- Selena Gatwiri, Massachusetts
- Charlie Mutua, California
- Charles Kabaiku, Kenya
- Maurice Akula, Texas
- Chairman, FEP Advisory Council
- PS Ministry of foreign Affairs & international Trade
- Kenyan Embassy, USA.
- Global FEP Diaspora Solutions Chairman, USA
- Global FEP Diaspora Solutions Representative, Kenya
- Global FEP Diaspora solutions Representatives, USA. (19 Members)