The collapsed Imperial Bank’s credit manager, Peter Nzuki has recorded a statement with the Directorate of Criminal Investigations saying that the Deputy Chief Justice Philomena Mwilu improperly borrowed Sh12 million in October 2013.
The manager said that the money obtained by the Deputy Chief Justice was given to her in inappropriate circumstances contrary to bank-customer relations.
Mr Nzuki says that DCJ Philomena Mwilu did not properly apply for the loan as not all her documents were ascertained and no appraisal of her creditworthiness was undertaken.
Nzuki’s statement points that the disbursement was highly irregular and could not be described as a loan as such amounts of money is normally disbursed by the bank’s credit committee and not an individual.
DCJ Mwilu was not given an offer specifying the terms and there was no borrower’s request letter in the loan file. The loan was also advanced at zero interest yet the Sh12 million loan did not qualify for this.
“This is quite strange due to the fact that as a bank, the core business is to trade in depositors’ funds held at cost without expecting returns. It is only in circumstances where a facility becomes nonperforming or a project funded fails that such loans are restructured or rebooked at zero interest but this was not the case in this instance. The absence of a borrower’s request puts into doubt the lending contract,” reads part of Nzuki’s statement.
In response to a petition filed by Mwilu at the High Court, the DCI said that for the DCJ being a state officer, she not have accepted a disbursement of the money without applying for the same, without any letter of offer and with nil interest.
Mwilu was arrested on Tuesday alongside her co-accused Stanley Muluvi. She was later released on Sh5 million bond.
She has however argued that her arrest was only meant to embarrass her and taint her image as a Supreme Court Judge.
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