Monday, August 16, 2010

International Leasing and Investment - The "Fix" is in? Central Bank Trying to Stop?

The 16 August issue of AlQabas has an intriguing article on ILI: "Supervisory Reservations About Return of AlHomoud to International Leasing."  KSE page on ILI here.

The article states that:
  1. The regulatory authorities, among them the Central Bank of Kuwait, have reservations about the return of Fuad AlHomoud to ILI especially after his membership to the Board and appointment as Managing Director.  
  2. One of the largest creditors of ILI has joined in these reservations on the basis that he has been following the company for years and knows its "ins and outs".
  3. PWC who the creditors had engaged  issued a report that accused the previous executive management of taking loans and using them for other than the purposes for which they were obtained.  
  4. And PWC had recommended that court action be taken against previous executive management.  
  5. The article quotes an unnamed source in Munshaat (a Kuwaiti Real Estate company) that Mr. AlHomoud is facing a court case related to the time he was at both Munshaat and ILI.  
  6. After an examination, the Central Bank of Kuwait found that the previous management guilty of a number of violations and excesses and levied a fine of KD200,000.
What's apparently troubling some is the sudden "understanding" between Mr. AlHomoud and Mr. Bassam AlMutawa, the investor who has proposed a plan to save ILI.  The question is whether they have joined forces to save the company or for another reason.

At this point, AlQabas speculates (and note that word) that legal cases relating to ILI could be very uncomfortable for a variety of people and that having  control over the Company's "files" related to such cases could be a powerful motive for some to seek to obtain control over ILI.

ILI is currently suspended from KSE trading due to failure to provide financials.  It has not yet provided its 31 December 2008 financials or any subsequent ones.

And finally, while not stated in the article, I am going to presume that Mr. AlHomoud like a prominent expatriate Kuwaiti  businessman denies all allegations of wrongdoing.

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