Genghis Capital seeks way out of Chase Bank suit

Genghis Capital chief executive Geoffrey Gangla. FILE PHOTO | NMG
Genghis Capital chief executive Geoffrey Gangla. FILE PHOTO | NMG 

Two firms that were adversely mentioned by the Kenya Deposit Insurance Corporation (KDIC) as having assisted former Chase Bank managers to loot the lender’s assets now want to be removed from the suit.

They say their transactions with the troubled bank were all above board.

Genghis Capital, which had common shareholding with Chase Bank prior to its receivership, and Boulevard Properties Ltd — a Genghis subsidiary — have been listed among 20 firms and individuals who assisted the lender’s former senior managers embezzle depositors’ funds.
The KDIC is seeking orders to recover the funds.

Genghis Capital CEO Geoffrey Gangla, who is also a director of Boulevard, said the period being referred to by the KDIC was when the current shareholders of Genghis and Boulevard became owners of the company.

At the time Chase Bank was placed under receivership on April 7, 2016, the shareholders of Genghis were Zafrullah Khan (3,125,000 shares), Anthony Gross (3,125,000 shares), Duncan Kabui (2,500,001 shares), Ken Obimbo (2,500,000 shares), Winton Investment Services Ltd (1,650,179 shares), and Ali Cheema (1,249,999 shares).

However, in mid-April 2016, shortly after the bank was placed under receivership, he received a proposal from the former Genghis head of corporate finance who forwarded a prospectus in respect of a proposed capital raising by Genghis through the sale of new shares.

“The prospectus from Genghis indicated that as a result of the bank being placed under statutory management, Genghis was unable to access the bulk of its working capital for office and client use and was facing liquidity problems since most of its deposits were held in the bank,” Mr Gangla says in court papers.

He adds that at no point since the change of ownership have Genghis and Boulevard colluded, schemed or conspired to commit a theft, fraud or caused the bank to suffer loss as alleged by the KDIC in court papers.