Chris Kirubi, a Flamboyant businessman is reeling from a major loss triggered by a rather simple trick used against Haco Tiger Brands where he is a shareholder.
An accounting manipulation was orchestrated by staff at the company’s offices in Nairobi, leading to a Sh312 Million loss that had to be incurred by the shareholders, who include South Africa based Haco Tiger Brands and the Nairobi billionaire.
The accounting fraud involved pulling forward sales and falsification of stocks at their Kenyan subsidiary.
Management of the Nairobi-based fast moving consumer goods manufacturer was accused of overstocking major distributors to make it appear like they had hit their performance target.
Responding to the scandalous accounting, Haco’s Peter Matlare said that the Kenyan subsidiary led by sacked managing director, Mr Geoffrey Kiarie, were only focused on reaching their targets “in a number of ways that we would not ordinarily expect them to”.
The group company has operations in several African countries including Nigeria and Ethiopia.
In 2008, Tiger Brands acquired a 51 per cent stake in Haco from Mr Kirubi at a cost of Sh284 Million (at current exchange rates), leaving the Nairobi industrialist with a 49 per cent interest in the company.
Three former directors at the company have since been charged for the embarrassing fraud.
Mr Kirubi is regarded as one of Kenya’s most shrewd and successful businessmen and has vast interests in media, real estate, coffee farming and energy sectors.