How online forex trading scam reeled in the innocents

Investors storm VIP Portal forex agency offices in Limuru before its collapse last year to present complaints to management. PHOTO | FILE 

By SIMON MBURU

In Summary

• Police investigations carried out last year revealed that VIP Portal received over Sh1.08 billion between October 2013 and September 2014.
• By the time the accounts were frozen, the firm had a balance of Sh174 million since its directors, Mr Wangai, Mr Collins Thumbi Mundia, Mr Daniel Komo, and Ms Nkatha Karimi had withdrawn much of the Sh1.08 billion.

Mr Robert Siahi had big dreams last year. He wanted to pursue a degree course in a local university.

Already an established trader in Limuru, Mr Siahi worried about financing his dream. During a meeting with one of his friends, he was encouraged to put his money in VIP Portal, a forex brokerage firm based in Limuru, Kiambu County.

“A few days later, I saw Mr Alfred Wangai discussing how profitable forex trading was on a local TV station,” Mr Siahi says. “The figures whetted my appetite and I decided to invest.”

Mr Alfred Wangai is one of the proprietors of VIP Portal.

On April 16, 2014, Mr Siahi invested Sh106,000 and on May 22, 2014, he put in an additional Sh500,000.

“My contract with Mr Wangai was supposed to bring me Sh1.2 million after 75 working days. It was to be disbursed within three phases but this never happened.” The loss was devastating. It ended Mr Siahi's dream of joining university.

Mr Siahi is among 13,000 ‘investors’, who have lost over Sh1.1 billion to VIP Portal in what could turn out to be the biggest forex trading scam in Kenya’s history.

Unsuspecting investors

Police investigations carried out last year revealed that VIP Portal received over Sh1.08 billion between October 2013 and September 2014.

The deposits were from unsuspecting investors in Limuru, Nairobi, Nakuru, Nyeri, Kisii and Kisumu.

According to Mr Siahi, Mr Wangai first opened his offices in Limuru on or around June 2013.

“After opening his offices at K-Unity Building (also known as Ushirika House), Mr Wangai tapped the locals to market his firm,” Mr Siahi says. “It was easy for us to believe in the people we were accustomed to.”

By October 2013, VIP Portal had spread across Limuru. In some cases, Mr Wangai asked investors to sell their land and deposit the money with VIP Portal with a promise that he would more than double it in less than a month, Mr Siahi said.

VIP Portal promised a five per cent commission per month for every new member an investor brought in. As investors in Limuru shovelled their hard-earned savings into the firm, so did their counterparts in Nyeri, Kisumu, Kisii, Nakuru and Nairobi.

The minimum the investors were required to part with was Sh25,000. Meanwhile, Mr Wangai turned to television talk shows to market his firm. His right-hand man, Mr Felix Oluoch, was his chief online publicist.