Imperial Bank depositors threaten legal action against CBK

A group of Imperial Bank depositors have threatened to sue the Central Bank of Kenya (CBK) to get information about their money.

CBK is already drowning in an avalanche of suits, including a contempt of court application seeking to have CBK Governor Patrick Njoroge, the regulator’s board, and the Kenya Deposit Insurance Corporation (KDIC) bosses locked up.

The depositors from the coastal region now say CBK has up to next week to share information on the state of the failed lender or face additional court action. They say the action against the regulator has been informed by the fact that Imperial Bank’s receivership ends on April 12.

“We have no option but to demand this information contained in this letter within the next seven days failing which we reserve the right to take such steps or proceedings as are necessary in the exercise of our rights,” said the Imperial Bank Lobby Group Coast chairman, Samir Inamdar, in an open letter to the CBK published in a local daily.

The depositors are demanding access to crucial forensic evidence on Imperial Bank after its owners failed to force CBK to show them the report by the US audit firm, FTI Consulting.

They also called for a review of the payouts made by CBK through NIC Bank, another matter that has been opposed by the bank’s owners.

“CBK intimated that depositors would receive 40 per cent of their remaining deposits in a structured manner, with the balance being paid over time. A later press release, however, advised depositors of a payment of 10 per cent of their remaining deposits without any explanation,” said the lobby's letter.

If they sue KDIC and CBK, they will be in good company with Vista management, Kaushik Natuwarlal Thakar, Amool Jivraj Nathwani, Atul R. Shah, and Dune Packaging Limited, who have filed separate suits against Imperial Bank over the payment of their deposits.

CBK is also facing a counter-suit by the family of the bank’s former boss, Abdulmalek Janmohamed, who has since died, trust fund, and Janco Investment Limited, which he used to acquire a 13.5 per cent stake in the bank.