A forensic investigator has traced Sh3.4 billion in eight bank accounts linked to former Imperial Bank managing director Abdulmalek Janmohamed who is accused of being behind an elaborate fraud scheme that robbed the lender of Sh34 billion over a period of 13 years.
The Kenya Deposit Insurance Corporation (KDIC) told the court that the accounts were opened using fictitious names under the direction of Mr Janmohamed, who died in September 2015—just a month before the lender was placed under receivership.
Court documents show that the late Janmohamed and his associates used 12 companies to open accounts at Imperial Bank into which they deposited massive amounts that were then moved out of the bank before they were immediately closed.
The transfers were made by a section of the bank’s top managers, including current managing director Naeem Shah and his deputy, James Kaburu. The duo would then manipulate software systems at the bank to ensure the dummy accounts disappeared from the records.
Forensic investigators, FTI Consulting, uncovered the eight banks accounts linked to Mr Janmohammed that were built with cash stolen from Imperial Bank.
The accounts were registered as Gulshan Account, which has Sh364 million, Ali Shah account (Sh264 million), Barkat Khan account (Sh376 million), M Khan account (Sh341 million), B Mohamed Account (Sh337 million), Jionesh Shah account (Sh50 million), Zulfikar account (Sh376.5 million) and Hanscombe/Angelica account (Sh1.3 billion).
The accounts were in the names Zulfikar Jessa, Zarina Mohammed, Angelica Industries Ltd and Barkat Khan, which court documents show were fake names.
“The bank claims jointly and severally against the deceased estate and the 2nd, 5th and 6th defendants the sum of Sh3.4 billion which amount was illegally and fraudulently received in trust from the SB accounts, which accounts is made up as follows,” says KDIC in court documents.
Court documents did not reveal the banks hosting the eight accounts, which have nearly 10 percent of the cash believed to have been siphoned from Imperial Bank.
KDIC has made a fresh application to the court for a permanent freeze on the bank accounts and other assets linked to the late Janmohamed.
The banks’ deposit protection agency reckons the decision to reopen Imperial Bank or liquidate it will ultimately depend on whether the bank will manage to trace and recover the amounts siphoned from the lender.
Proceeds of the fraud were mainly invested in real estate properties, offering fresh insights into the role that corruption and crime plays in driving Kenya’s housing market.
Mr Janmohamed left a vast estate, including prime real estate properties, shares in blue chip companies and loads of cash in various banks.
The suit has also revealed a gigantic empire that Janmohamed left behind, which includes a five percent stake in Butali Sugar Mills and another five percent of Imperial Bank. Other prominent companies he had a stake in are Old Mutual and Apex Securities.
He also had shares in Sandview Properties, Allgate Limited, Serenity Limited, Plymouth Holdings, Upperview Properties, Downtown Holdings and Nature Stone Queries.
One of his companies, City Park Properties, owns office premises that rake in a total of Sh447,000 monthly.
The Imperial Bank founder’s cash was saved in four bank accounts, one each at I&M Bank and National Bank of Kenya, and two at Standard Chartered Bank. The Standard Chartered accounts were in foreign currency.
Mr Shah and Mr Kaburu, despite revealing the scam to the Central Bank of Kenya (CBK), have not been spared as they are among the respondents in the suit.
They have admitted to making the illegal transfers but claim they did it on instructions from Mr Janmohammed.
The list of companies used in the fraudulent scheme includes E. Tilley (Muthaiga) Limited, Primecatch Exports, Mara Fish Packers, J Fish Limited, Victorian Delight, Ruby Red Limited, Value Pak Foods, From Eden Limited, Aqualite Limited, Marmo Granito Mines from Tanzania, Uganda’s Marmo Marbles and Fishways Limited.
E. Tilley (Muthaiga) Limited alone has admitted to receiving Sh10 billion from the bank and has expressed readiness to return the loot.