KCB fights off Sh145billion fraud claims as High Court freezes disputed funds

The Group Chief Executive Officer (CEO) Paul Russo’s led Kenya Commercial Bank (KCB) has been drawn into a high-stakes legal battle over a disputed €978.68 million (about Sh145.6 billion) foreign remittance, with the lender asking detectives to investigate documents allegedly used to support a claim that it received and withheld the colossal sum.

The dispute has taken a dramatic turn after the High Court temporarily barred KCB from transferring, trading, interfering with or otherwise dealing with the disputed funds pending the determination of a suit filed by Foxcapital Investments Limited.

Commercial Division Judge Rhoda Rutto issued the order restraining the bank from dealing with the money, which Foxcapital says is being held in a “Held – Pre-Settlement Suspense” account under Incident No. KCB-FIN-IT-2026-0417 for the benefit of the investment company.

But while Foxcapital maintained that the €978.68 million was legitimately transmitted to its KCB account, the bank disputes receiving the money and has raised serious questions over the authenticity of documents relied upon by the company in its Sh145.6 billion claim.

KCB has consequently asked the Directorate of Criminal Investigations (DCI), through its Banking Fraud Investigations Unit, to investigate the documents presented in High Court Commercial Suit E533 of 2026 and establish whether any criminal conduct occurred.

The case places billions of shillings and the credibility of banking records at the centre of a legal battle in which Foxcapital accuses KCB of unlawfully withholding an enormous foreign investment, while the bank maintains that its systems contain no record of the alleged transaction.

Foxcapital is seeking a declaration that KCB’s continued withholding of the money and failure to credit it to the company’s Sarit Centre branch account is unlawful, arbitrary and constitutes a breach of the bank’s contractual, fiduciary and statutory obligations.

The company is also seeking a mandatory injunction compelling KCB to immediately and unconditionally release and credit the funds to its account.

It further wants interest on the disputed amount at commercial banking rates, compounded from February 8, 2026—the date it claims the money became due for crediting—until payment in full.

Through lawyer Philip Nyachoti, Foxcapital argued that the case was sufficiently urgent to warrant being heard during the court’s August recess, warning that further delay could trigger massive financial losses and jeopardise a multi-billion-euro investment partnership.

According to court documents, the disputed funds were allegedly transmitted on November 28, 2025, by UBS Switzerland AG on behalf of BB Biotech AG Ltd, now known as Bay Bionics Ltd, for credit to Foxcapital’s account.

The transfer was purportedly made pursuant to a Partnership Agreement on Investment and Financial Co-operation signed between Foxcapital and Bay Bionics on October 21, 2025.

Under the agreement, Foxcapital says Bay Bionics committed €978.7 million to finance strategic investment projects in Kenya, including infrastructure bonds, public-private partnership initiatives, renewable energy projects and other national development programmes.

Foxcapital says Bay Bionics honoured its commitment by instructing UBS Switzerland AG to transmit the money through a SWIFT transfer on November 28, 2025.

“The remittance was duly confirmed by a SWIFT MT 910 Credit Confirmation together with an official MT 940 Customer Statement of Account issued by UBS Switzerland AG, unequivocally evidencing the successful transmission of the funds to KCB Bank,” the company told the court.

Foxcapital says the money has remained uncredited for more than six months despite what it describes as confirmations from the originating bank.

It further claims that UBS Switzerland AG carried out an internal interbank telemetry review and, on March 10, 2026, confirmed that the funds had successfully been delivered, settled and unlocked as of February 8, 2026.

The investment company also claims that KCB’s own internal investigations cleared the transaction through its Anti-Money Laundering (AML) Compliance Department and IT Security Department.

According to Foxcapital, the internal reviews found no adverse findings, staff collusion, unauthorised manual overrides, suspicious authentication events or irregular system integrations connected to the transaction.

The company therefore argues that there is no legal or regulatory impediment preventing KCB from releasing the money, which it says remains in the bank’s suspense account.

“The withheld funds are earmarked for time-sensitive investment projects, including Government Infrastructure Bonds (IFBs), Public-Private Partnership (PPP) initiatives, renewable energy and other strategic developments,” Foxcapital told the court.

It claims the delay has stalled the proposed investments, caused substantial financial losses and frustrated what it describes as a multi-billion-euro foreign direct investment into Kenya.

Foxcapital has also warned of an escalating international commercial dispute involving Bay Bionics and UBS Switzerland AG.

The company says the two institutions have signalled their intention to pursue legal action and escalate the matter before international financial and diplomatic institutions if the dispute is not resolved.

It has specifically referred to the possibility of the dispute being raised before the Bank for International Settlements (BIS), the European Central Bank, as well as the Swiss and British embassies.

Foxcapital argues that the continued withholding of the funds has undermined investor confidence, exposed it to contractual liabilities and placed strategically important Kenyan projects at risk.

But KCB has mounted a robust defence, disputing the fundamental premise of Foxcapital’s case.

The bank has told investigators and the court that its systems contain no record of the alleged €978.68 billion—or Sh145.6 billion—transaction.

KCB has further alleged that some of the documents presented by Foxcapital as evidence of the transaction may have been falsified.

Among the documents whose authenticity has been questioned are purported banking records, internal compliance reports and technical review documents allegedly showing that the transaction passed through KCB’s systems.

The bank says UBS Switzerland AG told it that documents and payment instructions presented to the bank for authentication were not originated by UBS and were therefore not genuine.

KCB has also told the DCI that officers whose names appear on some of the disputed documents have denied authoring or signing them.

The bank says its human resources records further show that there was no employee occupying the position of “Head of IT Security” cited in one of the documents.

The allegations have significantly escalated the dispute, transforming what initially appeared to be a commercial disagreement over a foreign remittance into a potential banking fraud investigation.

KCB has asked the DCI to establish who created, supplied or presented the disputed documents; preserve relevant electronic evidence; liaise directly with UBS Switzerland AG to authenticate the disputed records and payment instructions; and pursue prosecution if evidence of criminal conduct is established.