Mr Mwenda Njoka, who together with Ms Hilda Kaari sued CfC Stanbic. FILE PHOTO | NMG 
CfC Stanbic Bank has been ordered to pay a
senior government employee Sh1 million after listing his
name at a credit reference bureau (CRB) as a defaulter.
name at a credit reference bureau (CRB) as a defaulter.
Mwenda
Njoka and Hilda Kaari sued the bank and Credit Reference Bureau Africa
Ltd, accusing them of tarnishing their names by listing them among loan
defaulters.
The
court heard that they applied for a Sh11 million mortgage in 2008 at
CfC Stanbic for a house in Kileleshwa and repaid the loan on November
25, 2010 after running into default.
The two were later
denied a loan from Barclays Bank on grounds that CfC Stanbic had
forwarded their names for negative listing at Credit Reference Bureau
Africa Ltd.
After hearing the case, Justice Grace
Nzioka noted that at the time the names were forwarded to the bureau,
they had repaid the loan.
“In conclusion I find that indeed the plaintiffs defaulted on
the repayment of the loan and they were served with the default notice
and notice of listing. However, the listing was not done immediately and
subsequently, the plaintiffs fully repaid the loan. At the time of
listing, the loan was fully repaid,” the judge said.
She, however, absolved the bureau of any blame, saying the bank was wholly to blame for the incorrect information.
The
judge granted Mr Njoka and Ms Kaari Sh1 million, stating that there was
no evidence that the failure to purchase the house was purely because
of the adverse listing that denied them the Barclays loan.
The
bank said the two received two notices on December 14, 2009 that their
names would be submitted to the bureau within 14 days due to their
persistent defaulting.
At the time, Mr Njoka and Ms
Kaari opted to resell the Kileleshwa property for Sh19.5 million and the
funds were channelled through the mortgage account the bank deducted
its debt of Sh11.9 million and the mortgage account closed.
CfC
Stanbic said that it did not regularise their accounts in accordance
with the notice and consequently, their details were forwarded to the
bureau.
The bureau, for its part, said it was mandated
by the regulations to facilitate the sharing of information concerning
non-performing loans between institutions licensed under the Banking
Act.
Mr Njoka and Ms Kaari had accused the bureau of
failing to implement strict quality control procedures in order to
ensure the maximum possible accuracy of its database or failed to take
reasonable steps to ensure that the information it maintained, was
current, authentic and reliable.
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