As Absa Bank grapples with its tarnished reputation, new revelations are complicating the recovery process.
Recent developments include the dismissal of several employees over a massive fraud scheme where Digo Road and Nyali branches at the centre of the controversy.
In May 2024 staff from these branches conspired to embezzle Ksh 106 million from a retired ambassador and former Kenya Navy officer.
The scheme involved altering account signing mandates without the client’s consent, introducing a fake telephone number, creating fictitious accounts and siphoning off the funds.
The fraudsters manipulated the account to allow withdrawals under a proxy’s signature, with large sums exceeding Ksh 5 million being withdrawn in violation of CBK regulations.
Branch manager Jonesmus Mwambire approved a withdrawal of Ksh 7 million which saw his suspension by regional Absa boss Fadhiya Nordin.
Mwambire has since been terminated and further investigations are underway.
Nordin has assured customers of efforts to eliminate fraudulent staff including those accused of various malpractices.
Mwambire, who had served as acting regional manager, was also denied a permanent position.
Corruption and Nepotism
The scandal has resulted in the dismissal of Digo branch manager Mwambire and other key figures.
The treatment of staff at Absa continues to raise concerns among the remaining employees.
Court Strategy
Some senior executives at Absa Bank, led by CFO Yusuf Omari and other directors have pressured the legal and business support teams to foreclose court cases or fast-track the recovery process using auctioneers who can influence the auction process.
These friends win auction bids for bank properties, often financed by the bank, despite not qualifying for the facility.
The approval process is expedited by credit teams who are also part of the cartel.
Properties are then transferred to bank executives through companies registered in the names of law firms, many of which are also on the bank’s panel.
The bank is even disposing of branches at throwaway prices, such as the Absa Bamburi branch sold at 30% of its market value to proxies of Yusuf Omari.
Pressure is now being applied to MD Abdi and the corporate services department, led by Gilbert Ngetich, to also dispose of the Diani branch, which sits on a 15-acre beachfront plot.
The Diani branch also includes two bank-owned cottages, valued at over Ksh 400 million.
The bank cartels are demanding to sell this property to their proxies at no more than Ksh 120 million.
The bank tried to have the file disposed, knowing the matter would not proceed after a meeting with court officials at Tamarind Hotel Mombasa on November 1st, 2022.
Shockingly, despite the intensive meeting, the company’s legal team did not file a defense, exposing Absa shareholders to the Ksh 1.5 billion claim.
Over Ksh 3 million exchanged hands, facilitated by CFO Yusuf Omari while he was the acting MD.
Greed for Property
The aggressive disposal of bank properties has caused internal strife, leading to the resignation of Susan Situma, Head of SME, over disagreements on property management and client treatment.
The bank’s handling of the New Mega Africa case, including allegations of extortion and blackmail by Absa employees, further fueled internal discord.
Key executive Wycliffe Makori remains protected despite accusations of masterminding the scandal, which has alienated major corporate clients.
CBK and Absa South Africa Probing Staff
Both the Central Bank of Kenya (CBK) and Absa’s South African headquarters have launched investigations into the bank’s activities across Kenya.
The probes are focusing on properties acquired by senior staff between 2018 and 2024 amid ongoing allegations of money laundering.
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