Ex-Chase Bank bosses charged with Sh1bn fraud

Former Chase Bank chairman Zafrullah Khan and former managing director Duncan Kabui have been charged with stealing Sh1.15 billion from the lender, adding a new dimension to the long-running case.

Kibwezi West MP Patrick Musimba and his wife, Angela Mwende Musimba, were among a total of nine people charged alongside the two.

The Central Bank of Kenya’s (CBK) Banking Fraud Investigations Department (BFID) Thursday preferred the fresh charges at the Nairobi Milimani resident magistrate’s court. Only Mr Khan was present to take a plea in the case while the rest were asked to appear on September 17. The list of those charged alongside the four includes the bank’s former general manager for corporate credit, James Mwaura Mwenja, former general manager Makarios Omondi Agumbi, Lucien Sunter Vlasman, Ronald Petrus, Porting Access Limited and Itecs Limited.

Mr Khan, who was represented by lawyer Cecil Miller, denied four counts of conspiracy to defraud, stealing and money laundering.

Mr Miller applied for Mr Khan’s release on bond, arguing that he is already facing two other cases arising from the same transactions.

He told the court that Mr Khan is a heart patient and was scheduled to fly to the United States for a third heart surgery this week, but was summoned on September 11, 2018 to appear before the Director of Criminal Investigations (DCI) for processing.

“Police signed the charge sheet in a malicious move to bar Mr Khan from travelling to America for a third heart surgery. He has had two successful heart operations before and had been booked to attend a third one this September 2018,” Mr Miller said as he urged the magistrate to release Mr Khan on the strength of the Sh2 million cash bail in respect of the other two cases.

“Mr Khan is not a flight risk. He had been allowed to travel to America for a heart surgery twice and returned his passport to the court as directed,” Mr Miller said.

The accused had been directed to deposit his travel document in court as a condition to secure his freedom in the two other cases.

James Warui Mungai, representing the prosecution, did not oppose the release of Mr Khan on bond but asked the magistrate to impose new bail conditions because the case is a fresh one.

Mr Mungai also applied to have warrants of arrest issued against Mr Musimba, Mwende, Vlasman and Petrus.

Mr Miller promised to present Gichu, Mwenja and Agumbe to the police for processing and to produce them in court on September 17 as directed.

The court directed that Mr Khan be remanded in custody until Monday when it will determine the request for his release on bail.

Khan and his co-accused are charged with stealing Sh1,150,125,587 from Chase Bank between January 23, 2015 and March 2016.

Mr Khan has been separately charged with stealing the money by virtue of his employment.

The 10 are also charged with conspiring to steal the money by irregularly disbursing the said amounts to Porting Access Limited and Itecs Limited without following the payments process as stipulated under the Finance Policy of Chase Bank (K) Limited.

Khan, Mwenja, Kabui and Agumbi also face money laundering charges for moving Sh740,442,687 from the collapsed bank to Paramount Universal Bank.

The five also face another money laundering charge for moving Sh409,682,900 from Chase Bank to Kenya Commercial Bank.

Mr Musimba, Mwende, Sunter, Vlasman, Petrus and the two companies Porting and Itecs face money laundering charges for allegedly benefiting from the said Sh409,682,900 that had been removed from Chase Bank to KCB’s Kipande Branch.

The seven (Musimba, Mwende, Sunter, Vlasman, PetrusPorting and Itecs) are accused of benefiting from proceeds of crime by transferring Sh409,682,900 from Chase Bank to Paramount.

The case will be mentioned on September 17 for Musimba, Mwende, Sunter, Petrus, Mwenja, Kabui, Agumbi, Porting and Itecs to enter pleas in the case.