Britam blames fraud for loss in Rwanda

Britam Group Managing Director Benson Wairegi (right) with one of the firm’s directors Peter Munga during an Annual General Meeting in Nairobi. [Photo: Elvis Ogina, Standard]

Britam has attributed its poor performance in Rwanda to fraudulent claims on an outpatient insurance cover that saw the subsidiary report a loss during the year to December 2016.

Group Chief Executive Benson Wairegi said the company had already stopped offering the product and taken other measures on the challenge that led to Rwanda being the only operation within the firm’s stable to report losses.

Britam has subsidiaries in seven countries across East and Central Africa including South Sudan, Mozambique and Malawi.

“We introduced an outpatient product in Rwanda that was affected by fraudulent activities,” Mr Wairegi told the company’s shareholders during an Annual General Meeting in Nairobi Friday. We have since discontinued the product and brought in a new management.”

He added that Rwanda’s negative returns could also be attributed to the subsidiary being relatively new.

“All other regional operations did well with the exception of Rwanda. South Sudan made money and even paid a dividend,” said the CEO.

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During the AGM, shareholders voted to retain three directors despite them being above the Capital Markets Authority’s (CMA) recommended retirement age of 70.

CMA, however, notes that shareholders can opt to keep directors that are above 70 on the board.

The shareholders voted to retain 74-year-old Peter Munga, Jimnah Mbaru (70) and Francis Muthaura (71) in Britam’s board of directors.

“The directors have a lot of experience that will go a long way in guiding the company’s strategic direction. They also have the will to continue adding value to the company,” said Mr Wairegi.

The shareholders also approved the appointment of Caroline Kigen, Mohamed Karama and Mike Laiser as directors in the holdings company board.

Controller of Budget Agnes Odhiambo, who has served on Britam’s board for seven years, did not offer herself for re-election following the lapse of her tenure.

There has been a debate on public officials holding positions in private firms, which, according to some, is contrary to the Constitution that bars public servants from being gainfully employed elsewhere.

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Mr Wairegi, however, said Ms Odhiambo had opted out because she felt she had served the company and wanted to give room to others, and not due to conflict of interest.

He added that being a board member was not the same as being gainfully employed.

The CEO said the 31-storey Britam Towers in Nairobi’s Upper Hill, built at a cost of Sh4 billion, will be completed over the next two months.

The firm is also building 163 serviced apartments in Kilimani at a cost of Sh3.3 billion.

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