Between August 2015 and December 2016, the then Real People Chief Finance Officer Norman Ambunya had a fat wallet, transferring Sh1.3 billion to offshore accounts in 13 transactions.
Emails from South Africa, Uganda and Tanzania were all that were needed and he said yes each time, for anyway the money was not ‘his mothers’ as Kenyan politicians put it.
The cash was from unsuspecting retail investors, insurance firms and institutional investors who had given Sh1.3 billion of their hard-earned money to South African lending company Real People hoping to get paid back with interest in three and five years.
Exclusive documents seen by Smart Business into how Real People diverted bond receipts to offshore accounts reveal how insiders took liberty with investor funds to bail out subsidiaries when the management knew the company would itself need the same soon.
“Hi Norman, we are currently holding loans pending payments due to lack of cash in the bank. Could you please bail us out as we try to manage client expectations for now. All accounts are zero. We need at least UGx450 million to take us through the week,” Brian Jjemba the then general manager Real People Uganda wrote.
The cash was wired from the company accounts without stating the reason for the transfer and without a board approval for the money raised from the 2015 bond out of the country instead of lending to Kenyan SME’s as it had told investors.
This trend was repeated signed off and approved by top officials in the bank until the last penny was spent. “I no longer work for Real People,” Mr Ambunya said and hung up the phone when contacted last week.
Now the Capital Markets Authority wants 13 officials to explain their roles including former board chair Robert Arthur, former group CEO Neil Gobbelaar, Bruce Schenk, Charl Kocks, Nthenya Muli, Albert Ruturi, Daniel Ohonde, Yvonne Godo, Norman Ambunya, James Mbui, Bruce Evans, Arumugam Padachie and Wermer Nel.
Most of them have moved to other ventures and private consultancies but CMA is seeking to recoup the funds, fine them and bar them from holding office in regulated companies.
They are accused of taking part in a scheme where the money raised from local investors to lend to SME’s was diverted out of the country to pay for an internal loan.
Real People started draining the bond money in just over a week after collecting the funds at NIC Bank in August 2015 moving the money to an account in Standard Chartered Bank in Kenya and later transferred to Standard Chartered Bank account in South Africa.
Some money was wired to Chase Bank then diverted back to the Standard Chartered account.
Investigators believe the cash was put into the company account at Standard Chartered to muddy the waters so that the bond money and company funds were one and the same.
From 2015 to 2016 all the Sh1.3 billion had been siphoned and channeled out of the country to related companies in South Africa, Uganda and Tanzania.
Third party companies
Once in South Africa the money was quickly move to third party companies, paid utilities and office expenses and channelled to a suspect group of suppliers within the same day or the next day after the money arrived from Nairobi. When called to account, top officials denied they had used the bond money wrongfully and instead claimed the money sent to South Africa had been generated from loan repayments from clients.
The value of the internal loan itself is shrouded in mystery. First it was transferred to Kenya just before the bond was issued so that the bond proceeds would be used to pay it.
“After Kenya bond has been issued, it would make sense for Real people East Africa to fund itself… To achieve this, the loan receivable from Uganda must be transferred to RP (Real People) Kenya prior to repatriation of funds from Kenya bond issue to RP-in settlement of intercompany loan,” the documents read.
As at March the company had an internal loan of Sh1.06 billion and had revealed that during the 2015/16 year it was planning to pay Sh504 million. But when the bond money came in they paid Sh1.02 billion even though they had not disclosed the bond money would be used to pay it in the information memorandum.
Source link : https://allafrica.com/stories/202103170856.html
Author : Nation
Publish date : 2021-03-17 13:50:54