By ABDULKARIM SHERMAN
Imperial Bank shareholders have filed documents in court in a bid to shade light on underhand dealings at the bank in what is expected to be a bruising legal battle with Central Bank of Kenya (CBK) over the collapsed bank’s assets.
Shareholders of the fallen Imperial Bank say Central Bank of Kenya employees participated in a fraud the regulator wants to investigate.
Kenya Deposit Insurance Corporation (KDIC) and CBK lodged a fresh suit against former directors and shareholders of Imperial Bank in a bid to recover Sh 45 billion that sent the lender into receivership.
The shareholders oppose the move, arguing that CBK was complicit in the activities that led to the bank’s collapse.
In papers filed in court, the Imperial Bank shareholders aim to demonstrate that CBK employees played a major role in covering up malpractices at the bank.
The evidence filed in court [download here] show witnesses statements, the application to list the witnesses –the counterclaim and defence suit which is in response to the Sh 45bn assets freeze.
The court documents show that 13 CBK employees were involved in mismanaging the bank’s post collapse process, had inappropriate relationship with the bank’s former Group Managing Director, that some of them took bribes and asked for personal favours, concealed data on the bank’s vital state of affairs and others took off-book loans.
The shareholders say they believed KDIC and CBK only wanted to liquidate the bank because history showed that the beneficiaries of such moves were usually liquidators and consultants, not creditors or depositors.
The shareholders argue that they were not engaged in the running of the bank. They however, add that after the death of the bank’s former MD, Abdulmalek Janmohamed in September 2015, revelations emerged of fraudulent disbursement of vast amounts.
They aver that upon realising the fraud, an emergency board meeting was called where it was resolved that a forensic audit firm — FTI — be appointed to carry out a forensic audit.
The shareholders are Kenblest Ltd, Imaran Ltd, Reynolds and Company Ltd, East Africa Motor Industries Ltd, Momentum Holdings Ltd and Abdulmal Investments Ltd.
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