Joshua Oigara, the Chief Executive and Executive Director of Stanbic Bank Kenya Limited, has sued the Directorate of Criminal Investigations (DCI), citing improper summons over a case involving the bank and Air Afrik Aviation Limited.
In the case presented before High Court Judge Chacha Mwita, the CEO claims the Banking Investigative Fraud Unit (BIFU) of the DCI summoned him on the day he was with President William Ruto at the Kenyatta International Convention Centre during the 2024 Inua Biashara MSME Summit and Exhibition. He was required to go to their Kiambu Road headquarters to write a statement regarding an eight-year dispute between the lender and Air Afrik Aviation involving a substantial sum of $7.2 million (approximately Ksh930 million).
According to Mr Oigara, the detectives said they were investigating the bank for engaging in “unsafe and unsound banking practices,” including fraudulent false accounting. He disputes these claims, stating they are intended to interfere with ongoing court cases, particularly one filed by the local airline before Judge Nixon Sifuna, which was heard earlier this week.
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Stanbic Bank and the CEO’s lawyer, Kamau Karori, added that the current investigation is based on a complaint previously reviewed by the Central Bank of Kenya (CBK), which found no wrongdoing by the bank in debiting amounts mistakenly wired to Air Afrik. Karori argued that Oigara should not have been summoned, as the disputed transactions occurred before he joined Stanbic Bank.
The bank’s legal officer, Janet Wanjohi, recounted that the case began in February 2016 when Stanbic received a credit advice note from the Bank of South Sudan (BoSS) stating that $7.2 million had been credited to Air Afrik’s account for a leasing agreement with the South Sudanese government. However, after the airline had withdrawn over Ksh100 million, the bank realized that BoSS had not transferred the funds, leading to a freeze on the account to prevent further withdrawals.
“It mistakenly and erroneously credited the interested party’s account with its own money. The first petitioner applied a ‘post no debit’ instruction to the account to prevent any further withdrawals and notified the interested party that the $7.2 million had been credited in error. The unutilized balance would, therefore, be reversed,” Wanjohi narrated.
Despite being notified by Stanbic, Air Afrik proceeded to file a lawsuit seeking refunds and damages, claiming that the freezing of the funds caused the cancellation of a $20 million lease contract with the South Sudanese government due to the airline’s inability to meet its contractual obligations.
During one of the court proceedings, a senior representative from the Bank of South Sudan, Mr Chan Andrea Chan, testified that Stanbic should have either maintained the frozen amount until sufficient funds were available or promptly wired the money back to BoSS.
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