Mystery of Sh3bn stolen by Imperial boss after his death

Late Abdulmalek Janmohamed, former Chief executive officer, Imperial Bank. PHOTO | FILE  

By BRIAN WASUNA, bwasuna@ke.nationmedia.com

In Summary

• Documents filed in court show that a fictitious bank account Mr Abdulmalek Janmohammed operated received and shipped out Sh3 billion after his death in mid-September.
• Imperial Bank has filed two suits in court seeking to recover every single cent of the Sh34 billion Mr Janmohammed allegedly stole from depositors in 13 years.

Troubled Imperial Bank founder and long-serving chief executive Abdulmalek Janmohammed is shown in bank transactions as having continued to illegally draw funds from the lender weeks after he died in September, adding a new twist to the ongoing battle to recover the money stolen from savers.

Fresh documents filed in court show that a fictitious bank account Mr Janmohammed operated received and shipped out Sh3 billion after his death in mid-September, pointing to the presence of in-house co-conspirators in the scheme.

Imperial Bank says in court documents that some of its top managers, including acting managing director Naeem Shah, deposited Sh3,058,439,474 in an account named Hanscombe Management Limited that Mr Janmohammed had used since 2002 to hold money stolen from the bank’s savers.

“Well after the death of Mr Janmohammed and under the auspices of Mr Shah and other senior bank officials, entries of Sh3.04 billion and Sh17.9 million passed through the Hanscombe account to conceal the fraudulent activities,” Imperial Bank directors say in documents filed in court.

Investigations into the scandal in which savers are said to have lost more than Sh34 billion in 13 years have revealed that Hanscombe Management Limited, the company that owned the account, was liquidated in 2002 but Mr Janmohammed kept open an account by the same name and used it to swipe Sh30 billion from Imperial Bank between 2002 and 2015.

The bank last Tuesday sought and got a court order freezing all the assets belonging to individuals and companies named as having received or benefited from the proceeds of the fraudulent scheme.

READ: How Imperial Bank chief stole savers' billions

Imperial Bank has filed two suits in court seeking to recover every single cent of the Sh34 billion Mr Janmohammed allegedly stole from depositors in 13 years.

The first suit seeks to recover Sh34 billion from 20 firms and individuals believed to have colluded with Mr Janmohammed in the scheme, while the second seeks to recover Sh4 billion he is believed to have left to his family in both cash and assets.

Court documents show that W. E. Tilley — one of the companies implicated in the scam — would receive bulk payments in a US dollar account on instruction from Mr Janmohammed. W.E. Tilley would then transfer the funds to another account in the bank where the dollars would be converted into Kenya shillings.

The money would then be transferred to the accounts of other companies linked to Mr Janmohammed, W.E. Tilley and its directors in instalments of between Sh10 million and Sh100 million every week.

Imperial Bank’s receiver manager reckons that the fraudulently acquired funds earned interest and that while the principal amounts were wired to the accounts of various firms, the interest was sent to three bank accounts linked to Mr Janmohammed and members of his family.

One account, in the name of Zulfikar Jessa and Zarina Mohammed, had received a total of Sh1.1 billion at the time of Mr Janmohammed’s death, according to court documents.

A second account, named Barkhatkhan and which was in the care of Mr Janmohammed and Naeem Shah, had received Sh3.2 billion by October 30 this year.

The third account in the name of Mr Janmohammed’s mother, Gulshan had received Sh363 million at the close of September 2015.

“Mr Shah has continued to unlawfully and fraudulently operate the Barkhatkhan account, which is evident from the entries made between September 15, 2015 and October 7, 2015 for sums in excess of Sh162 million. Reasons wherefore the plaintiff prays for a declaration that Mr Janmohammed’s estate and Mr Shah are liable to the bank for the sum of Sh4.7 billion,” Imperial Bank directors say in the suit papers.

Mr Janmohammed allegedly used the same process with 25 other accounts, which held between Sh25 million and Sh1.5 billion at any given time.
W.E. Tilley (Muthaiga) Limited alone has admitted to receiving Sh10 billion from the bank and has expressed readiness to return the loot. The company is owned by the family of deceased businessman Nargis Aziz Ali Jessa.

Other firms entangled in the scam and in which Mr Jessa’s family has interests are 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.

The scam came to light after Mr Shah, who succeeded Mr Janmohammed as managing director, revealed to the bank’s board of directors that he had helped cover up the fraud scheme.

Court documents show that Mr Janmohammed and his associates used 12 companies to open accounts at Imperial Bank into which they deposited massive amounts of cash that was then moved out before the accounts were immediately closed.

The transactions would then be wiped out of Imperial Bank’s system by a software application Mr Janmohammed obtained to avoid raising any suspicions.

Mr Janmohammed and his close associates also awarded themselves unsecured loans at below market rates, according to court documents.

Mr Shah and his deputy James Kaburu, despite revealing the scam, 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 of Mr Janmohammed.

Imperial Bank says Mr Janmohammed used the illicitly acquired wealth to significantly grow his offshore investment portfolio, including acquisition of stakes in companies outside Kenya.

In Mauritius, Mr Janmohammed acquired stakes in Titan Investments, Astonfield Solar and Asachi Solar Power Limited. He also acquired part of Parvel International Enterprises Limited and opened a bank account with an undisclosed amount of money in the British Virgin Islands.

His other offshore assets include two beach plots in Zanzibar, a number of real estate projects in Mozambique, a studio apartment in Dubai and a share portfolio in South Africa managed by financial services firm MMI Holdings.

One of the companies owned by Mr Janmohammed, Janco Investments, operated in the United Kingdom and South Africa.

Imperial Bank directors say they learnt that merely hours after Mr Janmohammed’s death on September 14, Janco UK Limited was dissolved.

“An anonymous note received by the bank has disclosed that on the day Mr Janmohammed died, Janco in which he held a 33 per cent shareholding was dissolved. The note goes on to state that the funds he held in his personal banking facilities at Imperial were transferred soon after Mr Janmohammed’s death and that his trust has been taken over by his brothers (Salim and Mehdi Janmohammed),” Imperial Bank adds.

Locally, Imperial Bank says Mr Janmohammed owned shares in Old Mutual, Apex Securities, Butali Sugar, Sandview Properties, Allgate Limited, Serenity Limited, Plymouth Holdings, Upperview Properties, Downtown Holdings and Nature Stone Queries