- New Land Amendment bill proposes that Land selling companies deposit an indemnity bond of Ksh 500 million to prevent fraudulent land sales.
- A new regulation authority for Land Dealing companies will be established to protect future buyers from fraudulent land sellers.
- If the new bill is passed, land-selling company shareholders and directors must undergo vetting before the company is licensed to sell land.
The fear of being defrauded is always a main concern when buying land. Fraudulent sales have become so prevalent that people are now forced to learn how to protect themselves from being conned.
In 2021, the Directorate of Criminal Investigations set up a Land Fraud Investigations Unit to deal with the rising number of fraudulent land cases.
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What Does the Land Amendment Bill Entail?
The new Land Amendment bill proposed by Kirinyaga Central MP Joseph Gitari seeks to offer recourse and future protection for all land buyers.
According to the MP, “the principal objective is to regulate the legislation and licensing of the “land buying” companies and protect the interest of persons who purchase land from the said entities.”
The bill proposes setting up an office of the Registrar of Lands Dealing Companies to oversee the registration and licensing of land-selling companies. And facilitate deregistration of land-selling companies operating fraudulently.
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The bill also proposes a declaration of all shareholders and directors. And a mandatory physical office address to weed out briefcase companies that are prevalent in the market. Any company that gives false information will be denied a license to operate as a land-selling company.
The requirement of a deposit with the new regulatory body, similar to what banks have to do with the Central Bank of Kenya, is also aimed at ensuring that buyers can be compensated should they buy land that the land-selling company does not legitimately own. Additionally, licenses of existing land-selling companies will be canceled if they breach the terms of operation set by the regulatory body.
Other Plans in Motion to Curb Duplicitous Land Sales
Legitimate real estate companies have also established an Association of Real Estate Stakeholders to help weed out the fraudsters infiltrating the market.
The fraudulent companies have a knack for bribing land officials to process fake title deeds, making even credible companies look questionable as it is hard to tell the title deeds apart.
So far, 200 land-selling companies have signed up to the Association, with an additional 300 expected to join. The association seeks to set up a code of conduct and a disciplinary committee to deal with rogue companies.
If adopted, this membership will become a key factor when buyers are selecting a real estate company to buy land. Similar to the KEBS sticker or the ISO certification.