Kenya’s Capital Markets Authority(CMA) on Tuesday said that it launched enforcement proceedings against the directors of collapsed Imperial Bank Limited for failure to disclose material changes to the bank’s operations,a clear indication the that bond holders of the Ksh 2 Billion bond issue had invested on incorrect information.
The enforcement hearings are expected to determine the former directors’ role in and liability for; material mis-statements contained in the Information Memorandum issued to the investing public; omissions and failures of the former board members in failing to disclose material changes in circumstances of IBL in relation to the terms of the bond offer to the investing public and CMA when it came to their attention; and omissions and failures of former IBL board members to take or facilitate appropriate interventions to terminate or otherwise suspend the raising of capital from the public based on materially incorrect information.
The hearings are being conducted by the full CMA Board with the objective of being concluded in an expeditious and efficient manner subject to the requirements on procedural fairness and reasonableness.
The CMA notes that the proceedings were delayed to allow for the collection of necessary evidence and the actions will be without prejudice to potential liability of the former directors with respect to findings of complicity or knowing perpetration of the fraud scheme that resulted in the placement of IBL under receivership by the Central Bank of Kenya on October 13, 2015.
In other related news, Imperial Bank depositors on Tuesday held peaceful protests at the Bank’s Head Quarters in Nairobi demanding action to be taken against those behind the fall of the Bank.
