Companies

Imperial depositor wants Central Bank boss in Arusha court

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CBK governor Patrick Njoroge. FILE PHOTO | NMG

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Summary

  • In the appeal to be heard this morning (Thursday), Pontrilas Investment Ltd accuses First Instance Division of exhibiting bias by failing to summon Dr Njoroge to shed light on the collapsed lender.
  • The court had in June last year dismissed the application to summon the CBK governor saying he was not the custodian of the documents sought.
  • In the case, Pontrilas Investment, a depositor at IBL has accused CBK of failing to play to its oversight duty, despite being aware of widespread mismanagement in the collapsed bank.

A depositor has appealed a decision to bar the Central Bank of Kenya (CBK) Governor Dr Patrick Njoroge from appearing before the Arusha-based East Africa Court of Justice as a witness over fraudulent activities at collapsed Imperial Bank.

In the appeal to be heard this morning (Thursday), Pontrilas Investment Ltd accuses First Instance Division of exhibiting bias by failing to summon Dr Njoroge to shed light on the collapsed lender.

The court had in June last year dismissed the application to summon the CBK governor saying he was not the custodian of the documents sought.

In the case, Pontrilas Investment, a depositor at IBL has accused CBK of failing to play to its oversight duty, despite being aware of widespread mismanagement in the collapsed bank.

The depositor wanted Dr Njoroge called to produce documents and shed light on the regulatory role played by CBK and why he failed to discharge his role as required. The depositor filed the case in 2017.

The company said the CBK failed in its duty to regulate and supervise IBL in the interest of the public by maintaining economic stability through adherence to the rule of law, good governance and its own supervisory framework thereby leading to shocks in the economy as well as losses to depositors and creditors.

“That the Honourable Judges misinterpreted and misconstrued the power of the Court under the said rule; failed to appreciate the tests and principles relating to the rule; misapprehended the fact that the courts system of jurisprudence is adversarial in nature and acted as though they were in an inquisitorial system,” the depositor says in the appeal.

A bench of three judges led by principal judge Monica Mugenyi, Audace Ngiye and Charles Nyachae ruled that they saw no reason to compel Dr Njoroge to appear as a witness.

The company said massive frauds were committed by the managers or administrators of Imperial Bank with the knowledge or connivance of CBK officials through illegal transactions or acts.

The lender was placed under receivership on October 13, 2015 after CBK learnt of the fraud, which milked the lender of Sh34 billion.