The Central Bank of Kenya./FILE
CBK boss summoned over Imperial Bank case
Central Bank Governor Patrick Njoroge and directors have been ordered to attend court in 30 days and show cause why they should not be jailed for defying a court order against taking steps to liquidate Imperial Bank.
Justice George Odunga yesterday issued the notice after Imperial Bank shareholders filed an application claiming CBK did not comply with the November order.
Imperial Bank was placed under receivership by the regulator after the discovery of a Sh44.9 billion embezzlement scheme allegedly spearheaded by deceased managing director Abdulmalek Janmohammed.
Odunga had on November 4 prohibited CBK and the Kenya Deposit Insurance Corporation from taking any steps that would result in the liquidation of the bank until the legal provisions are complied with.
The court had also compelled CBK and KDIC to provide the shareholders and other stakeholders, including the bondholders and depositors, with the information concerning the arrangements entered into with Diamond Trust Bank, Kenya Commercial Bank, Kogweno Associates and the NIC Bank, and the manner in which the depositors are to be dealt with.
Shareholders claim CBK and KDIC have not given them the necessary information regarding the receivership and arrangements entered into with third parties.
Justice Odunga also issued a 30-day notice to Njoroge, KDIC chief executive Mahmoud Mohamed, acting KDIC board chairman Julius Kipngetich and directors Dr Kamau Thugge, Attorney General Githu Muigai, Nasim Devji, Jeremy Ngunze, Samuel Kimani to personally attend court.
The shareholders claim the CBK and KDIC have ignored an order to share details of Imperial Bank’s status and discuss possible revival plans with all stakeholders.
The shareholders have also questioned the continued payment of some depositors through NIC Bank in exchange for assets, arguing that the move amounts to premature liquidation, which Justice Odunga had barred.
They claim that the respondents, in a press release dated November 2016, indicated that they would “continue the processes that were suspended by the court, and in particular, NIC’s due diligence and contract review, which is expected to lead to structured access to the remaining deposits.” The shareholders say this is in blatant breach and utter contempt of the judgment.
The contemplated transfer process to NIC is what the court had barred in June 2016.
The case will be mentioned on March 24.
Source: The Star