Under siege Britam boss quits
President Mwai Kibaki is received by Mr Dawood Rawat, then Group Chairman British American on September 08, 2011 during the British American Investment Company Bond offer Bell ringing at Nairobi Stock Exchange . FILE |
What you need to know:
- It will hold the stake valued at about Sh14 billion through the State Insurance Company of Mauritius (SICOM). It is expected that the government will then dispose of it to repay those who lost money in a Ponzi scheme allegedly involving Mr Rawat in his home country.
- A Mauritian bank, Bramer Banking Corporation (BBCL), which is associated with Mr Rawat, lost its licence after it was discovered to have been operating the Ponzi scheme.
Controversial billionaire Dawood Rawat has ceded his stake in Britam and quit the firm’s board at the height of a huge financial scam in which he is alleged to have defrauded Mauritian investors of billions of shillings.
The Government of Mauritius yesterday said it would take over the 23.34 per cent stake held in Britam by the beleaguered businessman, giving it control over almost a quarter of the financial services firm.
It will hold the stake valued at about Sh14 billion through the State Insurance Company of Mauritius (SICOM). It is expected that the government will then dispose of it to repay those who lost money in a Ponzi scheme allegedly involving Mr Rawat in his home country.
“The investment in Britam earlier held by Mr Rawat is now in safe hands as it will be held by the Government of Mauritius. The takeover has just commenced and will be done in accordance with the necessary administrative and legal procedures in the two countries,” the Mauritian Minister for Financial Services, Good Governance and Institutional Reforms, Mr Roshi Bhadain, said in a statement seen by the Nation.
Mr Rawat’s resignation appears to have quelled fears at Britam, where he held the largest stake. He is accused of collecting premiums of over 14,500 customers with the promise of high returns, a scheme that turned out to be unsustainable reportedly leading to the loss of over Sh60 billion of investors’ funds.
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A Mauritian bank, Bramer Banking Corporation (BBCL), which is associated with Mr Rawat, lost its licence after it was discovered to have been operating the Ponzi scheme.
Similarly, the Mauritian Government also appointed a conservator to manage Mr Rawat’s insurance firms held under BAI Co (Mtius).
The Mauritian minister’s announcement provides a sigh of relief to Britam’s management and shareholders following the placement of Mr Rawat’s firms under receivership over the alleged financial impropriety charges back home.
Yesterday, Britam chairman Francis Muthaura sought to reassure shareholders over the firm, saying its businesses were not affected by the development in Bramer Bank and BAI.
He also defended Britam managing director Benson Wairegi, who had been serving as an independent director of Bramer Bank since July 2013.
Mr Muthaura said that the board has full confidence in Mr Wairegi’s leadership and integrity.
