NAIROBI, August 21 – The state has terminated a criminal case against Ugandan contractor, James Mugoya Isabirye, which emanated from a loan obtained from a local commercial bank in the 1990s.
Senior State council Vincent Wohoro on Thursday entered a writ of nolle prosequi in a fraud case before Nairobi Senior Principal Magistrate, Cecilia Githua arguing that Mugoya had settled a long-term dispute with Kenya Commercial Bank (KCB).
“My lady, I am instructed to enter a nolle prosequi in this case because parties have settled their dispute and the Attorney General does not wish to continue with the case,” said Wohoro.
Mugoya who was the Director of Mugoya Construction Company which was put under statutory management over a debt it owed to KCB, had been charged with fraudulent disposal of mortgaged goods valued at Sh3.5 billion.
He was alleged to have removed an assortment of engineering machines from godowns in Nairobi’s Embakasi area without the consent of the bank.
The businessman had according to the bank, used a title deed and construction engineering machines as security to an unspecified loan on condition that the equipment remain at specified location known both to him and the bank.
According to court papers, the prosecution also claimed the contractor signed debentures from KCB over a period of seven years – Sh35 million in 1990, Sh70 million in 1993 and Sh530 million in 1997.
When he failed to service the loans, the bank appointed PriceWaterhouseCoopers as receiver managers of the construction firm but he claimed in an affidavit, that KCB deliberately placed a false complaint and exaggerated the value of the mortgaged goods with a view of ensuring that he was unable to raise the bond or bail likely to be set by the court.
Mugoya has been out on a Sh10 million cash bail since his prosecution in 2006.