Businessman S.K Macharia takes legal action to reclaim Directline Assurance

Business mogul S.K. Macharia has taken legal action to reclaim Directline Assurance Company, claiming it was unlawfully seized through a forged CR12 form.

Through his lawyer, Danstan Omari, Macharia has filed a petition at the Milimani Law Courts seeking to have himself and his wife recognized as the rightful owners, demanding accountability for the Ksh.8 billion in premiums swindled from policyholders.

"S.K. Macharia is the one who started the company with his wife. But it has come to the attention of the original shareholders that the original CR12 has been altered and shares moved. ILRA has done its investigation and confirmed that the CR12 is forged," lawyer Martina Swiga said.

He is also pushing for the prosecution of fraudulent directors and the urgent registration of the true owners, warning that 98% of PSV vehicle users may be unknowingly uninsured.

"Directline carries 98 per cent of all PSV premiums. 98 per cent of PSV passengers are exposed and being lured into thinking they are insured. We have moved with speed to compel the Registrar of Companies to register the rightful owners of the company," Omari noted.

The development comes a week after the company terminated its issuance of the insurance business.

The company on September 10, 2024 said any further transactions must be made through its original shareholders terming a CR12 purporting to have other shareholders as fake and obtained through the backdoor.

Directline decided to close its insurance operations and noted that the shareholders of the company had resolved to cease issuing insurance policies and to stop conducting the insurance business.

The termination further stated that the Association of Kenya Insurance Companies (AKI) was instructed not to issue any insurance certificates or stickers in the name of Directline Assurance Company Limited from the said date.

Royal Credit Limited came later to dismiss assertions by the Insurance Regulatory Authority (IRA) that Directline Assurance Company remains in operation.

In a statement signed by Dr SK Macharia, Royal Credit stated that Directline Assurance ceased operations on September 10 and that the IRA could not purport to regulate a non-existent entity.