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Economy

Kitany sues Linturi in Sh530m loan forgery row



Meru Senator Mithika Linturi. FILE PHOTO | NMG
Meru Senator Mithika Linturi. FILE PHOTO | NMG 

Marianne Kitany, the estranged wife of Meru Senator Mithika Linturi, has accused her husband of forging signatures to secure a Sh530 million bank loan using her properties as collateral.

Documents filed in court have laid bare the vast business empire that the couple built before their acrimonious break-up that is now playing out in numerous Family and Commercial court cases.

At the centre of the commercial dispute is Atticon Limited, a firm that Mr Linturi fully owned before ceding 50 per cent shares to Baron Estates Ltd, which is associated with the estranged wife.

The ceding of ownership was in exchange for Baron Estates guaranteeing a Sh50 million loan that Mr Linturi intended to borrow at Family Bank.

Mr Linturi is, however, accused of fraudulently kicking out Baron Estates from ownership of Atticon and further increasing the loan secured using the Baron’s property to Sh530 million without its consent.

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Ms Kitany is a former chief of staff at Deputy President William Ruto’s office. The two are engaged in an ugly court battle.

Family Bank has in its response distanced itself from the alleged forgeries, noting that it carried out due diligence on the security offered and that the documents were voluntarily executed.

Mr Linturi has denied that Ms Kitany has been his wife, claiming he had hosted her in his house on compassionate grounds after she lost her job in 2017.

“The plaintiff contends the said new change in the directorship of the 1st defendant (Atticon) and removal or otherwise as a shareholder therein was obtained fraudulently and unprocedurally without the authority of the then directors/shareholders,” Baron says in court filings.

Justice James Makau has issued an order preserving Atticon’s assets and Baron's properties charged as security to the loan until January 30 when both parties are expected to be heard in court.

Mr Linturi is yet to file his response to the suit. According to documents he filed in a separate case pitting him against Ms Kitany over the ownership of a Mae Ridge County Villas House, the senator revealed that Ms Kitany owns Baron Estates and Noniko Holdings Ltd through her children and close relatives as proxy or nominee shareholders.

Mr Linturi told the court in that case that Ms Kitany owns multi-million shilling properties through the two companies.

Documents filed in court identify Baron Estates’ signatories as Rodha Kitany and Collins Kipchumba Ngetich.

According to the court documents, Baron Estates is owned by Noniko Holdings and Collins Kipchumba Ngetich. Rodha Kitany executed documents as a director of Noniko Holdings.

Baron Estates also hired the services of a forensic investigator to ascertain the authenticity of the various signatures used to secure the loans.

The forensic audit report filed in court indicates that Rodha Kitany’s signature was forged to secure loans of Sh100 million from Family Bank, another loan of Sh325.7 million, and a separate overdraft facility of Sh100 million using the properties of Baron Estates.

But the report indicates that Mr Linturi’s signature on the documents authorising these loans are genuine.

Baron Estates says it learnt later after guaranteeing Atticon that Co-operative Bank rejected a request for a Sh30 million overdraft facility.

Co-operative Bank told the firm that its turnovers were too erratic to support borrowing, its collateral was inadequate, and that Mr Linturi has ‘a running hardcore credit card which has been negatively listed’, and history of late payments for previous facilities.

Sometime in August 2015, Baron Estates says, it was approached by Atticon emissaries to aid in the liquidity and workings of their firm.

The firm says it agreed to charge two of its properties to secure Sh50 million 12 months’ overdraft facility from Family Bank for consideration of 11,000 shares equivalent to 50 per cent.

Mr Linturi was left with 50 per cent shares, which he owned through Litany Investments Limited. Further, the two shareholders in April 2017 agreed to appoint two directors each to run the business. Emily Nkirote and Mr Linturi agreed to resign as directors to allow the new directors to take over.

But Mr Linturi is said have breached this agreement by declining to allow the new directors to take over, thereby single-handedly running the affairs of the firm, including the operation of bank accounts.

The frustrations allegedly led to the directors' resignation, which he promptly accepted and re-appointed himself and Ms Nkirote as directors.

In October 2018, the ownership of Atticon was changed to Mr Linturi with 10,950 shares and Ms Nkirote with 50 shares.

In the meantime, the charged loan secured by the charged properties was enhanced to a whopping Sh530 million.

On October 2, 2018, Baron Estates wrote to Family Bank, through its lawyers, demanding the properties to be discharged, arguing that the security was time-bound and had since lapsed. On October 25, 2018, Lilian Muge, who at the time was a director of Atticon, wrote to Mr Linturi asking him to refund Sh446.4 million he had allegedly irregularly withdrawn from the company’s accounts.

According to Ms Muge, Mr Linturi withdrew Sh335.5 million from the firm’s account at the Family Bank, utilised Sh73.3 million to build his Mae Ridge Country Villas House and spent another Sh37.6 million to renovate his Kairune Maua, Meru house.

“Kindly but urgently furnish us with details of how you plan to settle your account including the timelines,” she wrote.

Mae Ridge Country Villas House is at the centre of a separate High Court suit between the two.

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