Months after a ruling by the High Court of Kenya dealt a blow to Royal Media Services (RMS) owner Dr. S.K. Macharia in the dispute over the ownership of Directline Assurance Limited, the chairperson of Royal Credit is fighting back.
Macharia, along with other shareholders of Directline Assurance, has protested the changes made by the company’s directors, who were appointed following the court ruling.
Justice Alfred Mabeya while issuing a ruling over the ownership of Directline in October ordered a temporary joint board to be constituted by AKM Investments Limited, Janus Limited and RMS and directed bank signatories to be appointed by the interim board.
The court at the time believed it is essential to establish a caretaker board of directors to ensure that the company’s operations continue smoothly and that it can meet its obligations.
The judge observed that given that a consent had been entered by the parties, the composition of the board should align with the terms thereof.
Also Read: SK Macharia Warns Passengers Against Boarding Vehicles Covered by Directline Insurance
Justice Mabeya further allowed the audit of Directline Insurance books of account and report compiled by the interim board is to be undertaken within 90 days.
S.K Macharia Protests Changes by Directline Interim Board
However, months after the order, Dr S.K. Macharia in a statement on Monday, December 9, 2024, decried recent changes made by the court-appointed directors.
Macharia highlighted the changes which include the directors sending senior managers on compulsory leave and issuing instructions to the finance director to make what he described as fraudulent payments for services not rendered to the company.
He said the three sole shareholders in direct line Assurance Company Limited have sought the intervention of the Commissioner of Insurance Godfrey Kiptum as well as the Cabinet Secretary and PS Finance to stop the stripping of the assets of the company by the partially constituted board of directors.
The board constitutes of Kenneth Ndura, Maina Maingi and Titus Karanja who took office on October 4, 2024.
In the new move, the direct line Assurance Company Limited shareholders sent documents to the Commissioner of insurance showing that the court-appointed directors of Directline Assurance Company Limited effective October 31, 2024, have instructed the finance director to pay director’s fees and allowances for a period when different directors approved by the shareholders of the company were in office.
Accusations
The directors who were in office at the time were compensated for their services during this period.
Additionally, the partially constituted board wants Andrum Borian company ADV Advocates WG Wambugu and Company Advocates gako Miner Advocates Dentons HHM and Kairo and Mt Advocates paid for Legal Services they never rendered to the company.
Also Read: Court Gives Fresh Ruling on SK Macharia- Directline Case
The board has also instructed the finance director to pay Sceplus Consulting certified secretaries Kenya for alleged secretarial services to the company.
At the same time, Royal Credit condemned the partially constituted board’s move to put four senior management staff members on compulsory leave for their refusal to make an authorized payment.
The statement comes days after another court ruling extended the temporary orders to stop the execution of a search warrant on Macharia’s RMS.
On October 30, the court extended the orders barring the Director of Criminal Investigations (DCI) from executing search warrants against the Royal Credit Chairman in the ongoing case against Directline company.
In its previous ruling, the court had issued orders stopping the search until October 30, when the matter was to be heard inter-party.
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