Chase Bank woes land Genghis in trouble

Stock brokerage firm Genghis Capital has taken a hit from the collapse of Chase Bank, with one of its clients whose money is held up in the troubled lender suing it for recovery of the cash.

King County Limited and Murithi Wanjau have moved to court seeking liquidation of Genghis Capital over Sh10.8 million that the firm had allegedly failed to settle, arguing that the company is insolvent.

But in its response Genghis denied any indebtedness, stating that it was just an agent that facilitated the company to invest in its Genghis Capital Unit Trust Fund and separate cash it helped deposit in an interest-earning account at Chase Bank.

“The company was indebted to the petitioners in the sum of Sh1,750,000 and Sh8,997,410.45 respectively and a further interest rate of 16.65 per cent to the date of payment,” says the King County Limited in the court document.

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Genghis in its response says the Sh1.75 million was invested in Genghis Capital Trust Fund whose manager is British American Asset Managers and custodian is the Chase Bank, now under receivership.

Genghis says the fund manager and the custodian of the fund have the obligations of accounting for the funds.

The investment banker, further argues that in November 2015, through its agency Murithi Wanjau deposited Sh8.5 million in an interest-earning account at Chase bank.

Genghis Capital says the cash was placed in the interest-earning account with the knowledge of the petitioner, and that it acted simply as the agent.

Genghis admits receiving a demand letter from King County and Mr Wanjau but says their cash could not be accessed since the custodian bank is under receivership and there is a moratorium.