KCB and NBK battle to control TSS property in Sh2 billion loan dispute

Two banks are fighting to control a Mombasa businessman’s property because of Sh4 billion loans they say he owed them.

Tahir Sheikh Said, popularly known as TSS, is said to have borrowed Sh2 billion from Kenya Commercial Bank (KCB) and a similar amount from National Bank of Kenya (NBK).

KCB wants to auction TSS Grain Millers to recover its money. However, NBK has obtained court orders to stop the sale of the miller that is owned by TSS Investments, which was declared bankrupt last year.

NBK, however, failed to remove KCB as the administrator of the property.

KCB said it did not see any problem with its decision to take over the administration of the miller after the company failed to repay the loan.

KCB has termed NBK’s decision to sue it as an abuse of court process, claiming that the arrangement between it and the miller was illegal as it had failed to comply with companies law.

TSS died in January, leaving court battles over his property between members of his family, employees, and institutions he did business with.

Former employees

A relative and several former employees have been charged with forging documents and TSS’s signature with which they used to secure huge loans.

Juja Coffee Exporters, which is associated with the tycoon, has disputed the amount KCB and NBK are demanding.

The firm said while the business owes the banks some money, the Sh4 billion figure was exaggerated.

NBK wants the High Court to allow it to auction the miller to recover its money.

The banks says TSS borrowed the money in 2014 while KCB claims it advanced him two loans in 1998 and 2007.

NBK says KCB should not be allowed to sell the miller’s equipment because TSS used it as security to secure a loan from it.

“The equipment and machinery were in fact bought using funds granted to TSS Grain Millers by National Bank,” an official of the bank said in an affidavit.

KCB says it moved in as an administrator after the company failed to repay the loan.

Justice Peter Otieno yesterday ordered the administrator of KCB to advertise October 3 as the date the case will be mentioned during which he will give further directions.

TSS investments lawyer Mohamed Balala withdrew from the case.

In its court documents, KCB says it gave TSS Grain Millers a loan of Sh12.5 million on March 24, 1998. TSS handed over the title deed of the land on which the plant stands as security.

KCB accuses NBK of lending the miller Sh1.5 billion in 2014 using the same plant as security without consulting it (KCB).

In February this year, detectives in Mombasa arrested two people for allegedly defrauding the TSS companies of Sh10 billion.

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