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Air Afrik, Stanbic Bank in court over $20m leasing contract

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Passenger and cargo carrier Air Afrik has taken Stanbic Bank to court following the loss of a $20-million plane-leasing contract with the government of South Sudan over “banking irregularities and fraudulent banking dealings.”

The suit has been filed at Milimani Commercial Courts in Nairobi. It exposes the South African bank to compensation that could run into millions of dollars for alleged breach of procedures.

Air Afrik, which has offices in Kenya and South Sudan, claims that Stanbic Bank, which also has operations in the two countries, breached banking regulations by failing to act diligently before crediting funds, freezing its accounts and reversing the funds without a valid court order or a directive from the Central Bank of Kenya.

At the centre of the dispute is a $7.2-million down payment said to have been made by the Government of South Sudan, which the bank is alleged to have credited to Air Afrik’s bank account held in the same bank only to reverse it a few days later.

Stanbic Bank is accused of not following the rules of banking and the Kenyan law when reversing the money from Air Afrik’s account.

However, in the court documents, Stanbic Bank says it acted on a Credit Advice Note from the Bank of South Sudan, which was not backed by funds to credit Air Afrik’s account in Juba and could not therefore use its own funds.

Source: http://bit.ly/2InlH9j

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