Fraud claims in Triton assets sale spark court war

Allegations of fraud have dominated court proceedings over the sharing out of proceeds from the sale of assets mortgaged by runaway Triton Petroleum owner, Yagnesh Devani.

So far, assets worth Sh1.5 billion have been sold through court orders and Kenya Commercial Bank (KCB) has placed a caveat on other properties and shares at the Nairobi Stock Exchange over a Sh2 billion debt.

A court order is in force stopping Devani from offering for sale shares or assets held in 19 companies pending conclusion of multiple suits pending at the Milimani Commercial court.

KCB has challenged the sale of Camelot Estate Ltd which had been charged by the East Africa Development Bank (EADB) on grounds that it was tainted with fraud.

EADB sold the property along Waiyaki Way in Nairobi for Sh825 million to a contractor, Laxmanbhai.

KCB wants the transfer stopped, saying the asset would have attracted more than Sh1.2 billion.

Other orders KCB is seeking from the court is an inquiry on the February 8, 2009 sale and freezing of Camelot’s interests in its account held at EADB.

EADB, KCB and PTA Bank, Camelot and Laxmanbhai have been locked in a legal tussle over the property.

EADB has defended itself on the sale, saying elaborate steps were taken before the transaction was concluded.

Replying to suit papers filed by Allen Gichuhi for KCB, EADB through Njoroge Regeru said the bank exercised its statutory power in a valid and lawful manner.

EADB says the bids to purchase the prime city property were invited through newspaper advertisements and the highest bidder carried the day.

Laxmanbhai, the contractor on site, offered the highest bid of Sh825 million.

Following the sale, EADB claims that some Sh520 million was used to liquidate amounts due from Camelot.

The balance of Sh304 million, according to EADB, is available and would be used as the court directs.

In challenging the sale, KCB alleges that the nine-storey office block would have attracted more than Sh1.2 billion.

The lawyer told Mr Justice Muga Apondi last week that the process leading to the agreement of the sale was tainted with fraud and irregularity.