Nairobi, Kenya – September 31, 2026 — Citibank Kenya has moved to the High Court seeking to stop the Directorate of Criminal Investigations (DCI) from investigating its Kenya Country Officer and Banking Head, Martin Mugambi, over a disputed Sh261.1 million loan advanced to Kiru Tea Factory Company Ltd.
The constitutional petition, filed before the Milimani High Court, argues that the dispute is a commercial and corporate governance matter rather than a criminal case. The bank wants the court to permanently restrain the DCI from investigating the transaction and bar the Office of the Director of Public Prosecutions (ODPP) and the Attorney General from pursuing criminal proceedings against the bank or its employees over the facility.
The High Court has already issued interim conservatory orders suspending the investigations pending the hearing of the petition.
Sh261 Million Loan Under Investigation
The disputed credit facility, valued at Sh261.1 million (approximately $2.02 million), was approved in September 2019 and disbursed in March 2021.
According to court documents, detectives are investigating whether the loan received proper approval from the legitimate board of Kiru Tea Factory at a time when the company was experiencing internal leadership disputes.
Investigators are also examining the authenticity of board resolutions presented to the bank and allegations surrounding the movement of part of the loan proceeds after disbursement.
However, Citibank Kenya maintains that it relied on official company documentation submitted during the lending process and argues that financial institutions cannot reasonably be expected to determine the legitimacy of competing company boards before approving commercial facilities.
DCI Probe Triggered by Kiru Chairman’s Complaint
The investigations stem from a complaint lodged by Kiru Tea Factory Chairman Chege Kirundi, who alleges that the borrowing process was irregular.
Court filings indicate that while Kirundi remained chairman of Kiru Tea Factory, the wider Kenya Tea Development Agency (KTDA) experienced significant leadership changes throughout 2025 and 2026.
The case before the court, however, focuses specifically on the governance of Kiru Tea Factory and the approval process surrounding the disputed loan.
The court has not made any findings regarding the allegations raised by either party.
Citibank Says Matter Is Civil, Not Criminal
In its constitutional petition, Citibank argues that disagreements arising from company governance should be resolved through civil litigation instead of criminal investigations.
The bank warns that permitting criminal investigations into lending decisions whenever corporate disputes arise could expose financial institutions to uncertainty and discourage commercial lending.
According to the petition, banks routinely rely on resolutions, board minutes and corporate documents submitted by borrowers when assessing loan applications.
Citibank argues that holding lenders criminally liable because rival factions later dispute company leadership would create uncertainty across Kenya’s financial sector.
KTDA Governance Remains Under Scrutiny
The case comes as governance and financial management within the tea sector continue to attract public attention.
Government agencies have undertaken audits into borrowing, procurement and governance involving several KTDA-managed tea factories following calls for greater accountability in the sector.
The Kiru Tea Factory dispute forms part of the wider conversation around governance reforms, financial oversight and accountability within Kenya’s tea industry.
What the High Court Will Decide
The High Court is expected to determine whether the DCI can continue investigating the disputed loan while the constitutional petition is pending.
The court will also consider whether criminal investigators can examine lending decisions where questions arise over a borrower’s corporate governance or whether such disputes should remain exclusively within the jurisdiction of civil courts.
The outcome could have far-reaching implications for banks, corporate borrowers, investigators and regulators involved in complex commercial disputes.
Background
Kiru Tea Factory is among the factories managed under the KTDA, which oversees dozens of tea factories serving hundreds of thousands of smallholder farmers across Kenya.
