Court Halts Arrest of Stanbic CEO in $7.2 Million Aviation Dispute

The High Court in Nairobi has stopped the arrest and questioning of Joshua Oigara, CEO of Stanbic Bank, alongside other staff, over a financial dispute with Air Afrik Aviation Ltd.
This case revolves around a transaction from 2016, where Stanbic’s South Sudan branch mistakenly credited Air Afrik’s account with $7.2 million (approximately KES 930 million). The funds were believed to have been transferred by the Bank of South Sudan (BoSS) but were later found to be unremitted. Stanbic reversed the funds and froze the account to prevent further withdrawals, prompting a protracted legal battle.
Air Afrik claims significant losses due to the freeze, including the termination of a $20 million aircraft leasing contract with South Sudan’s government. Despite efforts to resolve the matter through the Central Bank of Kenya (CBK), which dismissed the airline’s complaint in 2016, Air Afrik has pursued civil action in the High Court. The Directorate of Criminal Investigations (DCI) reopened the matter, summoning Oigara and other staff to address allegations of fraudulent false accounting.
Stanbic, through its lawyers, argued that the DCI’s intervention constitutes harassment and abuse of power. They emphasized that the issue is already a subject of ongoing civil litigation and that Oigara was not employed by Stanbic at the time of the disputed transaction. The bank contended that the criminal summons were intended to intimidate and hinder its legal defense in the civil suit.
Air Afrik, represented by its managing director Eric Lugalia, has opposed Stanbic’s petition, asserting that the bank should cooperate with the investigation if it has nothing to hide. However, the High Court sided with Stanbic, issuing a temporary order blocking the DCI from proceeding with arrests or questioning until the civil case is resolved.
This case underscores the complexity of cross-border financial transactions and the challenges of resolving disputes involving multinational banks, corporate clients, and regulatory authorities. It also highlights concerns about the misuse of criminal investigations to influence ongoing civil litigation.