[dropcap]W[/dropcap]ith crossed fingers, Imperial Bank Ltd (IBL) shareholders and depositors are waiting to know the next step of the recovery process, which involves selling of the institution to new investors. But as hope gives in to impatience, a number of activities around the process have raised eyebrows.
It has emerged that some senior staff red-flagged for playing major roles in the collapse of Imperial Bank Ltd are still working for the bank under the Kenya Depositors Insurance Corporation (KDIC) against Central Bank of Kenya’s (CBK) own advice.
The regulator had announced that it would bar any senior official of collapsed banks from working at any bank. Interestingly, the directive has been implemented for other collapsed banks while former IBL officials linked to the fraud that brought down the bank are still working for the bank, ostensibly ‘helping’ with the recovery process.
Five senior managers who were named by the FTI Report for aiding in the fraud and are still working for IBL under KDIC include: Nina Shah, Head of Treasury; Robinson Boreh, Risk Manager; Peter Nzuki, the Manager in charge of Credit; Alisager Esmailjee, Assistant Manager for Credit; and Mehboobha Shamji, Senior Business Development Manager.
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Imperial Bank collapsed in October 2015 after its former boss Abdulmalek Janmohamed siphoned nearly Ksh34 billion from the bank through shady deals with fishmonger W. E. Tilley. The presence of employees accused of masterminding have raised fears of a conflict of interest which could affect investigations and the recovery process.
According to FTI investigators, as Head of Treasury, Nina Shah was the MD’s confidante and one of his few real friends. She is accused of aiding the transfer of money to instructed accounts including to the fish processing company, W.E. Tilley (Muthaiga) Ltd. The FTI Report says she knew all the transactions made by the MD and after his death, some of the beneficiaries of the fraud came to her to plan the way forward.
Risk Manager Robinson Boreh and Peter Nzuki who is in charge of Credit were named in the report for helping in covering up the fraudulent disbursements, including interest accruing on those disbursements. Alisager Esmailjee, Assistant Manager for Credit is accused of helping in the cover up the fraudulent disbursements converted to fake deposits, in dormant or inactive accounts to fund cash withdrawals.
SEE ALSO: Imperial Bank fraud a Central Bank conspiracy
READ: How CBK blocked cash injection that would have saved Imperial Bank
At the other end, Mehboobha Shamji, as Senior Business Development Manager, is said to have known records that were on the ‘special list’, which was not disclosed to the board during meetings. Shamji would advise on whether a name could be added on the list or not, according to the forensic audit.
KDIC CEO Mohamud Mohamud, while acknowledging that some of the managers have been kept to help investigators and recovery manager understand the bank’s operations, said some had been suspended, while others have been fired. “For some we have begun the process of legal action,” he said. “In the last three months we have fired four of them. But the law under the constitution is very tricky and we have had to follow through the law.”
He said the expression of interest issued last year after extending receivership for 12 months was nearing closure.
The shortlisted investors will be invited to pursue a more detailed engagement and will be granted access to a comprehensive “Data Room” of financial, legal and business performance information to develop their formal offer.
Mr Mohamud said KDIC had defaulted on some of the timelines in the IBL process because some of the investors asked for more time. He said he had held meetings with depositors to update them on the matter.
The sale was an about-turn by the regulator, and confirmed that the bank could be salvaged. During the receivership under NIC Bank they were able to get Ksh5 billion in loan repayments, which showed some potential for recovery. CBK insisted that shareholders played a part in the lender’s collapse in October 2015 after its former boss, Abdulmalek Janmohamed, siphoned almost Ksh34 billion from the bank through shady deals with fishmonger W. E. Tilley.
Meanwhile, Mr Mohamud said KDCI had paid up to Ksh2.5 million plus 10 percent, while about Ksh4.5 billion has been collected in loan repayments.
