Dubai Bank founder fights prosecution over money scam

Dubai Bank chairman Hassan Zubeidi. FILE PHOTO | PAUL WAWERU 

By BRIAN WASUNA, bwasuna@ke.nationmedia.com

Posted  Thursday, November 26  2015 at  00:00

In Summary

• Hassan Zubeidi has filed a petition at the High Court in which he denies any role in the alleged money laundering scheme.
• Mr Zubeidi argues that as chairman, he had no role in the day- to- day running of Dubai Bank.
• Mr Zubeidi alongside four other past and present directors at Dubai Bank are accused of failing to carry out due diligence of a customer before opening a bank account in the name of Runway Entertainment Private Limited, a company the prosecution says does not exist.

Dubai Bank founder Hassan Zubeidi is seeking to stop his prosecution alongside four other past and present directors at the troubled lender over a money laundering scheme.

Mr Zubeidi has filed a petition at the High Court in which he denies any role in the alleged money laundering scheme, arguing that as chairman, he had no role in the day- to- day running of Dubai Bank.

The Chief Magistrate’s Court issued warrants of arrest for Mr Zubeidi and four other directors at the bank for allegedly running a money laundering scheme at the istitution. Mr Zubeidi says he was not informed of the investigations or that he was to be charged, contrary to the law.

Mr Dutta and Baghel are accused of stealing Sh12,639,006 between April 28, 2014 and September 14, 2014 at Dubai Bank, Kenyatta Avenue, Nairobi.

Mr Zubeidi, Mr Sheikh and Mr Nandwa are accused of failing to carry out due diligence of a customer before opening a bank account in the name of Runway Entertainment Private Limited, a company the prosecution says does not exist.

“The chairman of the board of directors has no role in opening accounts. In particular, the said account was not opened with the petitioner’s knowledge. Mr Zubeidi had no notice of any investigation or court summons in respect of the charges and the decision to prosecute him is unlawful,” he says.

READ: How Dubai Bank chief took billions from customers

The warrants were issued after Dubai Bank’s directors failed to appear in court to plead to the three charges against them.

The Dubai Bank directors were expected to appear before the Chief Magistrate’s Court on December 2 to take plea after their lawyers argued that they had not received summons and that some of them were out of the country.

Mr Dutta fled the country in May, in the middle of a Central Bank of Kenya investigation into his role in a suspect share sale guarantee scheme.

The Friday warrant is the second against Mr Zubeidi in two weeks after the High Court deputy registrar issued another call for his arrest in a civil case.

The deputy registrar had just a week earlier called for Mr Zubeidi’s arrest for failing to heed a court directive to pay Sh7 million debt he owed Jazira Agencies, a Nairobi firm.

Dubai Bank was placed under statutory management in August after a Central Bank of Kenya audit report implicated it in massive breaches of industry regulations