Commercial Bank of Africa (CBA) has sued five of its customers for using forged title deeds to secure Sh450 million loans.
The lender says in a complaint to the police that the same pieces of land were slated for auction by another bank in February last year, raising suspicion as to the legitimacy of their title deeds.
Detectives from the Directorate of Criminal Investigations (DCI) have been investigating the matter since February last year after CBA’s complaint.
Details of the probe have been revealed in a suit the five CBA customers; Patrick Kang’ethe Njuguna, Edward Njuguna Kang’ethe, George James Kang’ethe, Margaret Wambui Kang’ethe and Gladys Njeri Kang’ethe have filed seeking to stop their arrest over fraud.
The five used their firms; Ndonga Limited, Wardpa Holdings and Kinjunje Garden Limited to secure the loans.
CBA in its letter to the DCI says it got suspicious of the title deeds after seeing an advertisement by Diamond Trust Bank seeking to auction the same assets over a defaulted loan.
The five say the DCI has no authority to charge them over a purely commercial transaction between their firms and the lender.
They add that the DCI investigations have been done secretly and without their involvement as required by the law.
“The said purported investigations, which were commenced in June 2016, have been secretive as none of the applicants is being invited or involved.
“The entry of the DCI officers into the fray of what are purely commercial transactions between the said companies, who are owners of the properties, and CBA unless halted by an order of prohibition shall result in blatant breach of the applicants’ fundamental rights and freedoms,” the CBA customers say.
But the DCI says in its response to the suit that the loans were fraudulently acquired in a conspiracy web between the five customers, the CBA relationship manager Stephen Warui Mwaura, valuation firms Lloyd Masika, Tysons, and Mureithi Valuers Limited and two law firms.
The DCI holds that it followed the paper trail and interviewed various parties in the lands registry before concluding its probe.
“It is clear that the loan amounting to Sh449 million disbursed by CBA was secured using forged facilities and the bank therefore does not hold any legal charge against any of the properties it is holding.
‘‘The bank cannot therefore exercise any right to the charges as the charges are all forgeries. The applicants have been charged upon the decision of the DPP,” says Joseph Kiragu, the investigating officer.
The five say they have notified CBA of their intention to sell the disputed pieces of land to settle all outstanding debts but that the lender has declined to hear them out.
They claim that the properties have a market value of Sh450 million.
One of the land parcels is in Nairobi’s Ngara Estate, another in Mountain View and the third in Dagoretti.
The five have also filed a civil suit to stop CBA from auctioning the land.
Both suits were filed in Mombasa but have since been transferred to Nairobi where the properties in question are located, and where the DCI has carried out the probe from.