Safaricom CEO, Peter Ndegwa and other Directors facing arrest over contempt of court

A warrant of arrest has been issued against all directors of Safaricom, including the CEO Peter Ndegwa, after a Magistrate Court found them guilty of contempt of court.

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A warrant of arrest has been issued against all directors of Safaricom, including the CEO Peter Ndegwa, after a Magistrate Court found them guilty of contempt of court.

Senior Principal Magistrate Henry Nyakweba of Embu Magistrate Court ordered the directors to be arrested and be arraigned before him for sentencing not later than January 10, 2023.

He issued the warrant after the company refused to obey a court order directing it to release  Sh7.7 million, being claimed by one Ephantus Mbogo Njuki. The money is from insurance firm Invesco Assurance. Safaricom operated an Invesco account through a Paybill number and Njuki attached the account to recover a compensation claim of Sh7.7 million.

In his suit papers,Njuki claimed Safaricom PLC was duly served with a Garnishee order absolute on October 4, 2022 for the release Sh7,778,887.24 by way of email but has failed and ignored to adhere with the same.

A Garnishee order is a legal notice to a third party to surrender money.

The directors facing arrest are Ndegwa, Dilip Pal, Christopher Kirugia, Winfred Ouko, Raisibe Morathi, Sitholizwe Mdalalose, Rose Ogega, Francesco Bianco, former CEO Michael Joseph, Elijah Bitange Ndemo, Mohamed Shameel Aziz Joosub and Linda Watiri Muriuki.

Loss compensation

Njuki urged the court to punish them by jailing them for six months or as the court may deem fit and  attached their assets to compensate him for the loss suffered as a result of the contempt in the alternative.

He claimed that he served the order upon Safaricom on October 4, directing the telcos to release the money but the company deliberately refused to comply.

The magistrate noted that although Safaricom representatives were not in court when the garnishee order was issued on September 29, the company was served with the order through an email.

“For this reason, the Directors of the 3rd Garnishee are therefore in contempt of the Court Order given on 29.09.2022 and should be punished for contempt,” said the Magistrate.

 “Despite having been served with the said order, the application subject to this ruling as well as the order of 09.11.2022, the garnishee (Safaricom) did not find it fit to participate in this proceedings and explain itself. I find this to be a blatant violation of court orders,” he said.

The Magistrate agreed with the decision of John Warungu Wanjeru that the courts should not fold their hands and watch helplessly as their orders are disobeyed with impunity and held the directors personally liable for disobeying court orders.

“A similar situation is apparent here.. I do not find any reason why I should not order the lifting of the corporate veil for Safaricom PLC and punish its directors for contempt,” said the Magistrate.

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