Politics and policy
By BRIAN WASUNA, bwasuna@ke.nationmedia.com
In Summary
- Diamond Trust Bank is demanding Sh6.1m from Imenti Central legislator Gideon Mwiti and collapsed Akiba Microfinance.
- The suit comes as the MP faces criminal charges for alleged rape, assault and intimidation of a woman in his Westlands office.
Diamond Trust Bank
is seeking to declare Imenti Central legislator Gideon Mwiti Irea
bankrupt over a Sh6.1 million debt he and the collapsed Akiba
Microfinance were ordered to pay the lender in 2008.
The bank says Mr Mwiti had neither settled the debt nor
challenged the court’s order and requested ...
the High Court to issue a bankruptcy notice against the MP. Mr Mwiti is yet to respond to the suit.
the High Court to issue a bankruptcy notice against the MP. Mr Mwiti is yet to respond to the suit.
Diamond Trust Bank had sued Mr Mwiti, Gabriel
Mugambi, and John Ncebere as owners of collapsed pyramid scheme Akiba
Microfinance in 2005 over an outstanding loan their firm failed to
settle.
The court ruled in DTB’s favour, and ordered Mr Mwiti to settle the debt that has kept increasing due to interest.
“We, Diamond Trust Bank, request that a bankruptcy
notice be issued by this court against Gideon Mwiti Irea. He is indebted
to the bank for an aggregate sum of Sh6.1 million. We produce an office
copy of a decree dated February 4, 2008 obtained in a civil suit. The
judgment has not been stayed,” DTB says.
Alleged rape
The suit comes as the MP faces criminal charges for
alleged rape, assault and intimidation of a woman in his Westlands
office. Magistrate Eddah Agade last month released the legislator on a Sh100,000 cash bail.
The victim’s lawyers had asked the court to keep
him in custody over claims that he was interfering with investigations
into the incident. The legislator could lose his seat should the court
rule against him in either case.
Under Kenyan laws, anyone declared bankrupt cannot hold public office.
The lender was awarded Sh1.7 million but the amount
has since grown owing to accrued interest of 24.48 per cent placed on
the amount. The money will continue accruing interest until Mr Mwiti
settles the amount in full.
The Central Bank of Kenya (CBK) closed Kenya Akiba Microfinance in 2005 on suspicion of being a pyramid scheme.
The firm collapsed with over Sh780 million in
members’ contributions. Mr Mwiti has been linked to its ownership but he
has denied the claim.
Mr Mwiti led the collapsed firm in suing CBK for
closing it down irregularly. Akiba won the suit in 2012 and the court
ordered CBK to pay it Sh930 million in compensation.
The court ruled that CBK’s 2005 raid of the firm was unlawful. The MP was at the time of Akiba’s collapse its managing director.
He was accused of cheating many Kenyans into
depositing their money in Akiba through the false promise of hefty
interest on their investment.
DTB last month issued the MP with a seven-day ultimatum to settle the debt. The notice expired on April 23.
DTB last month issued the MP with a seven-day ultimatum to settle the debt. The notice expired on April 23.
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