Kenyan high court freezes Rai Family Bank account

In a recent development, the Kenyan High Court has taken the decision to freeze a bank account belonging to the Rai Family.

This decision comes as a result of a legal battle between two brothers within the family over the removal of one of them as a signatory to Rai Investments Ltd.

Iqbal Rai, the brother in question, took his case to court claiming that he had been wrongfully removed as a signatory without following the proper procedures. According to the application filed by Iqbal’s lawyer, Ekuru Aukot, the removal of Iqbal as a signatory leaves the account vulnerable to manipulation and unauthorised withdrawals.

In addition to seeking reinstatement as a signatory, Iqbal has asked the court to grant him various other requests relating to the multi-billion empire owned by the Rai Family. This legal battle is part of a wider succession dispute surrounding the estate of their late father, Tarlochan Singh Rai, who passed away in 2010.

According to court documents, Iqbal has alleged that his attempts to resolve the issue and regain his position as a signatory have been ignored by his elder brother, Jaswant Rai. The situation has become increasingly concerning for Iqbal, as he believes that the current circumstances pose a significant risk to the proper management and security of the account.

The Rai Family, known for their involvement in the sugar industry, has recently faced scrutiny from the authorities. Jaswant Rai, in particular, has come under the radar of the State due to his business dealings in the industry. This recent legal battle adds to the existing tensions within the family and further complicates the issue of succession.

Since 1978, Iqbal has held the position of director and shareholder in the company alongside his brothers, Sarbjit Rai and Jaswant Rai.

In his application, Iqbal claimed that he was removed as a signatory in February 2023. He requested the court to order bank statements from March onwards.

“I was shocked and dismayed when, towards the end of February 2023, I asked the Defendant for Rai Investments Limited’s bank statements in my capacity as director/shareholder but was told that I couldn’t access them because I was not on the bank mandate,” Iqbal expressed to the court.

However, records at the company registry confirm that Iqbal still holds his position as a director of the investment firm.

“As it currently stands, after conducting a recent search at the Companies Registry, it is evident that I am still recognized as a director/shareholder of the company,” he informed the court.

The Rai family’s investments extend across various sectors including real estate, luxury shops, and manufacturing. Their operations span multiple countries such as Kenya, Uganda, Tanzania, and Malawi.

Disputes over control of their empire have often led to business rivalry. One notable example is their battle over collapsed Mumias Sugar Company. Sarbit Rai emerged victorious in bidding to revive the struggling miller; however, Janswant opposed this decision which resulted in a prolonged legal dispute.