Court Rejects Bid to Suspend Metropol CRB Operations
In dismissing the application, Milimani High Court Judge Justice Lawrence Mugambi noted the failure of the applicant to appear in court to defend the application which was filed on March 5, 2024.
The High Court has dismissed the application by the Commission for Human Rights and Justice compelling temporary suspension of operations of Metropol Credit Reference Bureau (CRB) a subsidiary of Metropol Corporation Limited (MCL) for failure of the applicant to appear in court.
In dismissing the application, Milimani High Court Judge Justice Lawrence Mugambi noted the failure of the applicant to appear in court to defend the application which was filed on March 5, 2024.
The application that was certified as urgent was seeking the court’s intervention to temporarily suspend the operating license of MCL’s CRB as issued by the Central Bank of Kenya (CBK) for going contrary to Regulation 43(1) of the Credit Reference Bureau Regulations, 2020. MCL is licensed to provide Credit Reference Bureau (CRB) Services to all banks in Kenya.
In July 2022, CBK carried out targeted onsite supervision of the Metropol CRB by Regulation 58 of the Credit Reference Bureau Regulations, 2020, and was found to be non-compliant with several provisions.
The issues were found to be the Bureau’s Corporate Governance, Database Access, and Data Integrity.
They alleged CRB had onboard numerous unauthorized and unlicensed agents and agencies across the country who were tasked with the task of handling volumes of confidential data which brought to question the integrity and safety of the said data and receiving large sums of money in return.
The entity was found to be operating with four directors for a long time contrary to Regulation 43(1) of the Credit Reference Bureau Regulations, 2020 which provides that a Board of Directors of a bureau or an agency should consist of at least five directors.
Further, they raised an issue regarding corporate governance and management of Metropol CRB which included the requisite quorum to run the company as expressly provided for in law.
CBK made recommendations for the Metropol CRB to take corrective measures in line with the findings of its Bank Supervision team with a provision that a report be transmitted back within 15 days. It went ahead and imposed penalties for non-compliance totalling Ksh 2 million.
Despite the strict timelines imposed, the respondents failed to comply.
CBK also noted that the interested party, Samuel Amukoko who presented himself as the Group Managing Director had been drawing salaries amounting to Ksh 29 million without a formal appointment or appointment letter,
“He had further made unauthorized and unexplainable drawings from the company coffers amounting to Ksh 82.8 million in the same period.” read the application in part.
They alleged that such and other lapses in the governance and management system resulted in MCL’s fall into a financial struggle where they claim as per July 2022, the liabilities were amounting Ksh 487,900,000 against its assets which stood at Ksh 31.2 million.
