Former Embakasi East MP aspirant Francis Wambugu Mureithi has been drawn into a high-stakes legal battle after being accused of fraudulently acquiring company shares belonging to the late Italian investor Gonzalo Hernadez Ciriza.
The dispute centres on Meridian Acceptances Limited (MAL), a Nairobi-based microfinance institution that provides credit to business owners and automobile dealers. At the core of the case are allegations of forgery, misrepresentation, and unlawful alteration of company records to seize control of the firm.
Alleged Corporate Takeover Using Forged Filings
Court documents filed at the High Court Commercial Division accuse Doc Find Company Limited, also known as House of Procurements Limited (HPL), of orchestrating the alleged takeover.
Mureithi, a director at HPL, is accused of using the company as a vehicle to illegally acquire shares and directorship in MAL, effectively locking out the heirs of the late Gonzalo Ciriza and other founding shareholders.
The suit was filed under a certificate of urgency by advocate Geoffrey Langat on behalf of James Ndwigah Muchungu, a co-founder and long-serving shareholder of MAL.
Sh320 Million Fraud Claims and Emergency Court Orders
Muchungu alleges that his removal as a director and shareholder was effected through fraudulent filings at the Registrar of Companies (RoC), without his consent or that of other shareholders.
He claims the disputed actions form part of a wider Sh320 million fraud, prompting him to seek urgent court intervention. Among the orders sought are:
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Freezing of all MAL bank accounts held at Kingdom Bank Limited and Kenya Commercial Bank (KCB)
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An injunction barring any further changes to MAL’s shareholding or directorship
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Reversal of all allegedly fraudulent company returns
AGM Controversy and Exclusion of Heirs
According to the pleadings, HPL allegedly convened an Annual General Meeting on February 2, 2023, attended only by Francis Wambugu Mureithi and Bernard Odote.
Other shareholders—including the heirs of the late Ciriza—were allegedly excluded. The heirs named in court documents are:
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Paloma Mosequera Ciriza
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Eduardo Hernadez Ciriza
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Joan Hernadez Ciriza
Langat argues that the exclusion violates MAL’s Articles of Association, which grant existing shareholders pre-emptive rights before any transfer of shares can occur.
‘Corporate Coup by the Minority’
Despite allegedly holding only 37.7% of MAL’s shares, Mureithi is accused of attempting to seize full control of the company.
Langat describes the move as “a corporate coup by the minority,” warning that such actions undermine corporate governance standards and threaten investor confidence.
Defence Raises Past Criminal Case Against Plaintiff
In response, HPL director Bernard Odote disputes the claims, arguing that HPL is a separate legal entity wrongly dragged into the dispute.
Odote further claims that Muchungu himself faces a criminal case involving the alleged embezzlement of Sh200 million from MAL during his tenure as director.
He cited a November 2021 High Court ruling by David Majanja, which barred Muchungu from participating in MAL’s operations and ordered him to surrender company property—a ruling that could significantly influence the current proceedings.
Registrar of Companies Yet to Respond
The Registrar of Companies, listed as the first defendant, had not filed a response at the time of publication.
The High Court has scheduled the matter for hearing on October 2, 2023, when both HPL and the RoC are expected to clarify their roles in the disputed transactions.
Broader Implications for Corporate Governance
The case has attracted widespread attention due to:
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The alleged Sh320 million value of the dispute
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The involvement of a former MP aspirant
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Claims touching on foreign investor rights
Legal experts say the outcome could have far-reaching implications for shareholder protection, corporate record integrity, and foreign investment confidence in Kenya.