Former directors of Imperial Bank directors suffered another blow yesterday after the High Court declined to temporarily stop the Kenya Deposit Insurance Corporation from taking over their property until the case is heard on October 18.
The beleaguered directors and shareholders had sought court orders stopping the transfer or interference of 44 companies associated with them.
Commercial court judge Francis Tuiyot, however, warned them against charging any of the said properties in which Imperial Bank, its receiver managers KDIC and Central Bank of Kenya are seeking to take over.
The former directors, through Lawyer Andrew Wandabwa, argued there is no evidence that his clients are disposing of some of the assets.
Lawyer Philip Murgor for IBL and KDIC had urged the court to allow the directors to continue trading in the listed companies, but stop them from charging any property or selling their shares.
The bank, however, said the depositors should be allowed to participate in the proceedings because the money they are seeking to recover belongs to them.
The ex-directors also opposed an application by depositors and clients to be enjoined in the case.
The depositors and customers of IBL filed the application on Monday seeking to come in as interested parties. They said the orders sought in the suit by IBL will affect them, as the national economy suffered the effects of the collapsed Bank.
Lawyer Josephine Awino for the depositors said her clients and their families are suffering huge financial losses because since the collapse of the bank, they have not been able to cater for medical care, education and cannot support charities.
“Our depositors' businesses have suffered huge losses due to lack of working capital, and in many instances ‘laid off’ employees in order to minimize our expenses and cut losses,” she said.
Justice Tuiyot however said he will deal with their application at a later stage.
IBL sued its former directors and shareholders and is seeking a Sh45 billion refund.
It accused the ex-directors and shareholders of participating in a well-orchestrated fraud that led to the loss of the said amount.