Mr James Murigu (left) and Ms Joyce Ogundo (right). The High Court has cleared former directors for fraud charges. [Photo/business daily]Justice George Odunga has cleared three former directors of Uchumi Supermarkets of fraud charges over a flawed Sh895 million rights issue in 2014.James Murigu, Bartholomew Ragalo and Joyce Ogundo were charged with an illegality that did not exist in the Capital Markets Authority (CMA) Act.The three moved to court after the CMA for allegedly accused them of their roles in conning investors through a flawed Uchumi rights issue floated in 2014.Other former directors and managers including disgraced chief executive Jonathan Ciano, also faced varied CMA sanctions for their alleged roles in the fraud scheme. Justice Odunga, said charging the directors based on a non-existent offence made the whole process void.“It’s therefore clear that whereas the actions of the applicants may well have constituted an offence under other statutes or provisions of the law, they were certainly not candidates for a charge pursuant to which they were required to show cause,” said Justice Odunga.The three were charged with the offence of ‘facilitating or omitting to prevent the provisions of misleading or deceptive statements in the information memorandum.”The judge, however, said the Act “prohibits a person from making, furnishing or publishing information or returns the content which are known to be untrue.”The former directors submitted that they had already left the Uchumi board at the time the sanctions were imposed and that the CMA’s actions were therefore illegal.Justice Odunga said he could only interfere with the CMA’s decision if it was made outside the band of reasonableness, noting that the regulator’s decision did not meet such threshold. The Judge also rejected the argument that the former directors had already left the board when they were charged, noting that former directors are culpable of what occurred on their watch.

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