Valuers across Kenya recently used X Space to reveal widespread bribery within the banking sector, exposing claims that several banks practice skewed allocation of assignment. Further revelations pointed to a troubling practice where certain banks limit their business to just a few preferred valuation firms, creating a closed system that stifles fair competition.
In a bid for transparency, the valuers compiled and released a list of the implicated banks with over 60 bank officers named for the alleged favoritism of certain firms.
However, the situation has taken a controversial turn with allegations that the list was hijacked to settle scores against some banks. It is alleged that these bankers were being targeted by valuers who want to maintain the status quo.
“We are aware that some of the bankers have been unfairly targeted,” said one of the valuers on condition of anonymity. “While the list highlights genuine issues of corruption, it has also been manipulated by a few valuers to serve their own interests. Banks should conduct thorough investigations to ensure that only those guilty of corruption are held accountable.”
This exposé has added a layer of complexity to an already fraught issue. The banking sector, crucial to Kenya’s economy, now faces intense scrutiny.
The risks of corruption in mortgage valuations are significant. Inflated or inaccurate valuations can mislead lending decisions, placing borrowers and lenders at risk. Over-leveraged borrowers may struggle with mortgage payments on properties that are worth less than the loan amounts, while banks could face financial losses and increased defaults.
This controversy unfolds at a crucial time for Kenya, as the country seeks to enhance its business environment and attract foreign investment. The persistence of such malpractices could undermine investor confidence and impact economic stability.