Leading broadcast media outlets and telecommunication service providers have been cited as being in an unholy union in perpetuating unlicensed radio betting and prize promotions of the largely unregulated sector, investigations by The Star Today have revealed.
The Betting Control and Licensing Board (BCLB) is on record raising fears that by operating in unregulated environment without the supervision of a BCLB official as required as well as failing to observe the mandatory deduction of 20 per cent payment of withholding tax as per the Income Tax Act, Kenya Revenue Authority (KRA) could be losing billions of shillings through tax evasion.
Safaricom PLC has been singled out for issuing short codes, USSD codes and paybill numbers being used to conduct unauthorised prize competitions and public lotteries without prior mandatory clearance by the BCLB.
According to documents in our possession, Inooro FM, a subsidiary radio station owned by SK Macharia of the Royal Media Services is said to operate an illegal paybill number 326325, Kameme FM, a branch of the Mediamax Network Limited is said to be operating two illegal paybill numbers; 65099 and 4030041.
Coro FM, Radio Maisha and Radio Jambo are operating similar paybill numbers 4080045, 40360045 and 812531 respectively all issued by the Peter Ndegwa giant telco firm, Safaricom.
A fortnight ago, while raising private member’s question on the floor of the House, Kiambaa legislator John Njuguna alias Ka-Wanjiku demanded the National Treasury Cabinet Secretary Ukur Yatani to furnish the National Assembly departmental committee on Finance and National Planning with financial details, records of tax remittances to Kenya Revenue Authority (KRA), paybill issued by telecommunication firms and beneficiaries of broadcast gambling by local radio stations.
He further sought for a comprehensive breakdown of financial statements and revenue generated for the last one year.
“Could the Cabinet Secretary provide details on ownership and value of transactions of all paybills and paybill numbers registered by Safaricom, Airtel and Telkom Kenya used in betting and gaming activities by major vernacular radio stations and more particularly by Inooro FM, Kameme FM and Gukena FM? Could the Cabinet Secretary further provide details on the financial statements of the paybill transactions, inclusive of names of beneficiaries, amounts paid and tax revenue generated within the last one year? What action is the government taking to address alleged cases of money laundering activities being undertaken through betting activities by the broadcast media in Kenya?” He posed.
Yatani was given fourteen days to formally respond to the matter.
BCLB is on record lamenting to the Communications Authority of Kenya over skyrocketing illegal broadcast gambling by local radio stations that has gone unabated and called for immediate stoppage of the same.
“The Board as indicated in our letter referenced BCLB I/27VOL.1/ (81) dated 12th November 2020 has noted an increased illegal betting and prize promotions by radio stations. This illegal activity has transformed radio stations as promoters of gaming activities thus departing from their licensed objectives to inform, entertain and educate the public.” BCLB Director Peter Mbugi said through a correspondence copied to Safaricom Legal Department and to the Media Council of Kenya (MCK).
“The radio stations in promoting these unlicensed activities have been asking members of public to deposit or send certain amounts of money to specific pay bill numbers in order to stand a chance to win a prize. These promotions take a greater percentage of the radio activities with some running these unlicensed betting activities throughout the day. These activities must be applied for and approved by the board.” Mbugi added.