A former acting Chief Finance Officer at the National Bank of Kenya faces sanctions from the Capital Markets Authority, after a tribunal rejected his bid to block a fine against him for financial irregularities at the lender before its takeover by KCB in September 2019.
The Capital Markets Tribunal dismissed an application by Wycliffe Lindong’a Kivunira who had sought to block the Capital Markets Authority (CMA) from imposing a Sh1 million penalty on him for impropriety.
“This Tribunal by unanimous decision, finds that the appeal is without merit, and it is hereby dismissed, and we make the following orders: -(a) The enforcement decision of the ad hoc committee on April 3, 2018 is upheld, (b) Each party shall bear its own costs of the Appeal,” read the judgment.
CMA issued a notice to show cause to Mr Kivunira in August 2017, following investigations into the affairs of NBK that revealed that the then-acting finance boss, willfully prepared and published false and misleading financial statements for National Bank of Kenya (NBK), by reporting a gain on disposal of assets of Sh847.9 million for the quarter ended June 30 to September 30, 2015.
The investigations also found Mr Kivunira to have been potentially involved in the embezzlement of NBK’s funds through commissioning a deposit mobilisation exercise in 2014 and 2015 and irregularly restructuring and rebooking loans, without the approval of the NBK board to save the bank from incurring obligations on loan provisions for non-performing loans (NPLs) amounting to Sh2.6 billion.
According to CMA, Mr Kivunira also recognised and subsequently wrote off interest on the NPLs amounting to Sh680 million contrary to provisions of the Guidelines on Corporate Governance Practices by publicly listed companies.
Mr Kivunira who was sacked by NBK in April 2016 failed to supply the CMA board with relevant, accurate and timely information to enable the Board to discharge its duties, resulting in a financial penalty of Sh1 million.
CMA Board found Mr Kivunira culpable of acting in contravention of regulation B.06 of the 5th Schedule of the Capital Markets (securities) (Public Offers, Listing, and Disclosure) Regulations 2002 by failing to prepare the interim accounts for the period June 30, 2015 by the International Financial Reporting Standards.
He also contravened Article 2.1.3 of the Guidelines on Corporate Governance Practices by Public Listed Companies in Kenya, 2002.
The matter was heard on April 4, 2018 and CMA released the finding of its investigations into the bank.
The CMA committee found Mr Kivunira culpable and imposed sanctions against him following an inquiry conducted into the affairs of NBK.
