Former Uchumi directors not yet off the hook
The Capital Markets Authority has moved to resurrect fraud accusations against former directors of Uchumi Supermarkets who were let of the hook by the court due to the defective charge.
The regulator has now written notice to show cause letters to James Murigu, Bartholomew Ragalo and Joyce Ogundo, and indication that the regulator is not yet through with the trio.
The letters written on January 31 seeks to cure the defect identified by the court when quashing the charges against the former directors.
Justice George Odunga in January ruled that three petitioners were charged with an illegality that did not exist in the Capital Markets Authority (CMA) Act when they were accused of fraud over a flawed Sh895 million rights issue in 2014.
“Pursuant to the judgment dated January 16, 2018… the High Court dismissed all the grounds of appeal you had raised against the Notice to Show Cause (NTSC) issued by the authority save for questioning the phraseology of the statutory breaches detailed in the NTSC detailing the allegations against you, the authority hereby issues you with a fresh NTSC as below,” reads the letters signed by CMA chairman Paul Muthaura.
HIT WITH PENALTIES
The three moved to court after they were hit with penalties by the CMA for their alleged roles in conning investors through a flawed Uchumi rights issue floated in 2014.
Mr Murigu was fined Sh660,000, being the pay he received as a director of Uchumi, while Mr Ragalo was ordered to pay the Sh855,000 he earned as board member.
The directors were also banned from holding office in any publicly listed company.
Justice Odunga, while declining to delve into details of the decision of the CMA, said charging the directors based on a non-existent offence negated the whole process.
Other former directors and managers of the troubled retail chain, including disgraced chief executive Jonathan Ciano, also faced varied CMA sanctions for their alleged roles in the scheme.