It is unusual for a bank to kick out a client, return money in their accounts and declare it does not wish to continue doing business with them. Yet, this is the situation Mr Paul Kobia, who describes himself as a businessman and politician, has found himself in. The flamboyant man had three accounts with Barclays Bank. But this was only until December 14, 2018 when the bank informed him that after reviewing its business, it had decided to close his accounts and return all the money he'd banked with the lender.
"As a result of this decision, your accounts or products will be closed with effect from January 14, 2019," Barclay’s premier relationship manager Joan Kiragu informed him.
Later, Kobia sued the Central Bank of Kenya (CBK) and the Attorney General claiming the regulator's requirement that banks make full disclosure of their client’s source of money, was the reason Barclays Bank was kicking him out. Kobia then urged the court to bar CBK from imposing the rule on how bank customers should transact and order that his accounts should not be closed. He claimed CBK was behind the plan he said had adversely affected his business by preventing him from accessing millions of shillings from his business associates and partners globally. Kobia said his business demands total confidentiality and that he has never been investigated for economic crimes relating to remittances of funds to his bank accounts.
He contended that developed countries such as Dubai, Singapore and Hong Kong do not demand documentary evidence before remitting cash to customers unless the accounts are under investigations for fraud or any other crime. CBK, in its reply, told the court that there was no nexus between the case against it and the problems Kobia had with Barclays. Commercial court judge Wilfrida Okwany heard that although Kobia had claimed his rights to privacy had been breached, he had no evidence to show CBK had a hand in it.
“The first respondent (CBK) has not stopped the petitioner from accessing his funds or receiving remittances from his business partners and associates,” the regulator said in its reply.
Justice Okwany said she did not understand exactly what Kobia was complaining about. She observed that although the letter by Barclays was the source of the dispute, his guns were firing elsewhere.
“Looking at the letter in question, this court is unable to find any nexus between the threatened closure of the petitioner’s bank accounts and any action by the respondents herein to justify the granting of the orders sought in the petition. I further note that nowhere in the said letter has any reference been made to any of the respondents herein or any regulations made by them as the reason for the intended or threatened closure of the petitioner’s bank accounts,” she ruled.
The judge dismissed Kobia’s case and condemned him to pay costs of the case to both CBK and the AG.