CBK demands Sh45 billion refund from Imperial Bank

The Central Bank of Kenya (CBK) and its agency Kenya Deposit Insurance Corporation moved to court yesterday seeking a Sh45 billion refund from Imperial Bank directors and shareholders. The CBK is seeking orders to freeze assets of 44 companies associated with Imperial Bank’s directors and shareholders. PHOTO: COURTESY

The Central Bank of Kenya (CBK) and its agency Kenya Deposit Insurance Corporation moved to court yesterday seeking a Sh45 billion refund from Imperial Bank directors and shareholders. The CBK is seeking orders to freeze assets of  44 companies associated with Imperial Bank’s directors and shareholders.

In an urgent application made at the High Court yesterday afternoon, CBK and Imperial Bank Limited, which is under receivership (first plaintiff) through its agency, the (second plaintiff) have sued Director Alnashir Popat (first defendant) and nine other directors for Sh2.7 billion they purportedly declared as dividend.

The other directors include Anwar Hajee, Jin F Shah, Hanif Mohamed, Amiralisomji and Mikesh Kumar Patel, among others. The CBK cites failure to provide proper documentation of its properties and assets, which implies that depositors and other shareholders may not access their deposits in the bank that is now under receivership and a subject of investigations.

Through Murgor and Murgor Company Advocates, CBK wants companies owned by Imperial Bank Directors, including Imaran Ltd, Imaran Real Estate, Aster Properties Limited, Upperview Properties Ltd, Brandy Blue Ltd, Nav Plastic Ltd,  to be compelled by the court to pay up.

 “Through the breach of fiduciary duties, gross negligence, fraud and breaches of the Companies Act, the first to sixth defendants caused the loss of Sh38 billion of the first plaintiff’s assets and depositors funds, whose loss rises to Sh42.2 billion, which is at a risk of not being recovered due to inadequate documentation and no security,” said Counsel Philip Murgor in his application.

The CBK says fraud by Imperial Bank directors has caused instability in the banking sector and subjected customers to stress and hardship brought about by loss of their deposits. The bank was closed in October 2015 after massive fraud was unearthed following the death of former managing director Abdulmalek Janmohamed.

Janmohamed is reported to have irregularly disbursed at least Sh34 billion to friends and family and cooked books to cover his crime, preliminary investigations indicate.