Former CMC Holdings chairman Jeremiah Kiereini, who had been blacklisted from holding any post in listed companies, is set to make a boardroom return after a judge reversed the ban.
In a judgement that could offer a new lease of life to six other former CMC Holdings directors blacklisted with Mr Kiereini last year, Justice David Majanja yesterday held that the Capital Markets Authority (CMA) denied him his right to a fair hearing.
“The consequence of my findings is that the decision of the CMA taking enforcement action against the petitioner (Mr Kiereini) must be set aside,” the judge ruled, invalidating the action that was taken on August 3, 2012.
The capital markets regulator, in a media statement on that date, announced that it had disqualified the CMC Holdings directors from appointment as a director of any listed company.
Apart from Mr Kiereini, others affected were former Attorney-General Charles Njonjo, former CMC Holdings chief executive officer Martin Forster, the company’s largest shareholder Peter Muthoka, Ashok Shah, Richard Kemoli and Andrew Hamilton.
The CMA also announced it would pursue the blacklisted directors to ensure they refund up to threefold the amounts they were accused of stealing from the company.
The action followed recommendations of a committee the company appointed to analyse an audit report prepared by South African firm Webber Wentzel. The report made allegations against the affected directors.
Mr Kiereini, a former permanent secretary in the Office of the President and head of the civil service and secretary to the Cabinet, filed a constitutional petition at the High Court, saying the action violated his rights and fundamental freedoms.
The court ruled that the board should have notified Kiereini of the charges against him and give him an opportunity to respond.
Although the CMA’s committee invited him to appear before it but he waived that right, the judge said the committee’s role was to make recommendations to the board and only the board could take action after according him a hearing.