Tycoon Devani tried in absentia over Triton oil scandal

Fugitive tycoon Yagnesh Devani was on Monday put on trial in absentia in a case relating to the Triton oil scandal in which Kenya Commercial Bank reportedly lost Sh2 billion.

A witness said the initial due diligence conducted on the tycoon’s Triton Petroleum Company before its engagement with the bank bore all the hallmarks of a suspect deal and prompted a crisis meeting in which “issues of concern” were raised.

Mr Devani is charged alongside Mr Julius Kilonzo, Mr Collins Otieno, Mr Mahendra Pathak and Mr Benedict Mutua, who were all present in court.

They are accused of stealing tonnes of automotive gas oil (diesel) at the Mombasa storage facility belonging to Kenya Commercial bank.

FUEL CRUNCH

The scandal shot to the limelight in 2008 when Triton was allowed by Kenya Pipeline Company (KPC) to collect oil valued at Sh7.6 billion and sell it on the bank’s behalf without its consent, leaving a fuel crunch in its wake.

Mrs Caroline Kariuki, a former corporate business manager at KCB, said an initial request by Triton to sell fuel at the Kipevu Oil storage facility in Mombasa on behalf of the bank was received with mixed reactions and drew certain remarks in a letter addressed to the bank’s credit department.

“The letter raised issues that were of concern to the credit department… there was the issue about the exposure to Triton being high, the growth of Triton was also considered high over a three-year period, in addition to an adverse mention of Triton by CharterHouse Bank,” Mrs Kariuki said.

OIL PRICES FLUCTUATING

She said there was also the concern about oil prices fluctuating and that the security of the bank was also considered weak at the time.

Mrs Kariuki said due diligence was a mandatory procedure “as the bank had to have an idea about its corporate clients.”

She said a team headed by the relationship manager examined Triton’s certificate of incorporation and found that Mr Devani owned 99 per cent of the shares and was the principal shareholder.

She said she was not aware whether the other suspects named in the case appended their signatures on the oil documents on behalf of Triton in the agreement between it and the bank.

WARRANT OF ARREST

Mr Devani fled the country in 2009 and still has a warrant of arrest pending against him.

On Monday, an assistant director of public prosecutions, Mr Victor Mule, told the trial court that he would not amend the charge sheet but would like to proceed with the trial in the absence of Mr Devani, who is the first accused in the case.

Mr Mule said the high court had ordered that the case proceed even in the tycoon’s absence.

Proceedings resume on November 11.