A trial court in Nairobi has set May 4 2017 for a ruling on whether the foreign investors in the multi-billion shillings worth Tatu City real estate development empire can be committed to civil jail for frustrating a court directive for the audit of offshore loans borrowed in the project.
PriceWaterhouseCoopers (PwC) was allowed to audit the offshore loans in the face of spirited opposition from the firm’s foreign shareholders who claimed the firm may not give a balanced finding based on its link to local Tatu City director Nahashon Nyaga.
Frustrating audit sanctioned by court
The local shareholders accuse their foreign counterparts of frustrating the audit sanctioned by an order of the high court on March 6 2015.
PwC recused itself citing frustration from the foreigners who were to append their signatures against the terms of reference for the exercise.
On September 23 2015, the local shareholders moved to court to have their opponents nailed for contempt( read frustrating the audit sanctioned by an order of the court).
The project estimated to be worth Sh240 billion has stalled over several suits pending in court amidst accusations and counter accusations of fraudulent transfers of shareholding and forgeries of transfer instruments.
In an application objecting to the audit by which had been rejected in court the foreigners calim PwC audited the former CBK and that the same firm was carrying out an audit at Bidco thus allegedly creating a conflcit of interest.
Confirm the amount borrowed since inception
The audit is expected to confirm the amount borrowed since the inception of the project, being Tatu City Ltd and its sister company Kofinaf Company Ltd, and the current status of the loans.
Norwegian Director Hans Jochum Horn had claimed that the firm was overstretching its mandate contrary to the court’s direction given on March 6 2015 and sought to have PwC substituted with either Ernest & Young, Deloitte, KPMG or any other international forensic audit firm.
Horn and Stephen Jennings hold stakes in the project and have been accused of impropriety in the affairs concerning the venture. Nyaga and his co-directors claim that their foreign counterparts want to kick them out of the project so as to freely control Tatu City and Kofinaf assets and capital.
The appointment of PwC to audit offshore loans borrowed by the directors sparked the dispute pending ruling in court.