The High Court in Kampala has ordered KCB Bank (U) and Kenya Commercial Bank to give Tirupati Development Limited documents as requested in an application submitted to the court to facilitate the resolution of a loan dispute between the two companies.
According to an application by Tirupati, the documents requested are relevant to the resolution of the main case that is now pending disposal.
In an Affidavit by Mrs Kruti Barot, the MD of Tirupati, the documents highlight several allegations including negligence, conversion, breach of fiduciary duty, breach of statutory duty, money laundering, and fraud by the respondents.
The documents sought by the applicant include those related to the loan transaction and loan account origination, negotiation, approval, processing, key facts documents, management, and closure.
Specifically, the applicant requested documents pertaining to the loan accounts, various bank accounts in the applicant’s name, fraud detection policies, investment origination and management, IT policies, cyber security, digital forensics, and money laundering policies since the enactment of the Anti-Money Laundering Act in 2013.
Mrs Barot emphasized the importance of the requested documents in determining the respondents’ authority to open and operate accounts in the applicant’s name and the legitimacy of the various transactions.
While the respondents opposed the application through an affidavit filed by Judy Wambaire, the company secretary of KCB Bank (U) Ltd, Justice Musa Ssekaana in a 5th May 2023 ruling said the application ‘partially succeeds’ and ordered the KCB Bank to avail documents Tirupati requested for.
Tirupati’s suit is premised on the loan facilities that it obtained from the banks, the manner in which they were managed and the policies relating to them, which are the issue in the main suit.
According to Daily Monitor, in the main case that is still pending determination, Tirupati contends that while KCB had agreed to disburse a total sum of $7m (about Sh26.7b), the total sum disbursed to the company was $6.99m (about Shs26b), contrary to the loan agreement.
Further in its main lawsuit, Tirupati argues that in 2018, they noticed and complained to the banks about several suspicious transactions on its current and loan accounts and they did not provide a coherent explanation for the same suspicious transactions.
The core contention is that KCB banks allegedly created and opened and operated various accounts in the names of the Tirupati, without her knowledge or consent.