THE directors of Trust Holdings – which owns the recently relicensed Trust Bank – have been ordered to repay a US$1.5 million loan borrowed from businessman Jayesh Shah some eight years ago.
The High Court directed William Nyemba, Christopher Goromonzi and Josphat Sachikonye to repay the loan with interest at the rate of 15 percent per annum from December 30 2004.
Shah is thought to be one of the "two loan sharks - one of Indian descent and the other British" recently blasted by Finance Minister Tendai Biti for allegedly wreaking havoc in the country’s financial services sector after it emerged the troubled Renaissance Merchant Bank had failed to repay a loan secured from him.
Meanwhile, High Court heard that the businessman represented the United Arab Emirates-registered company Alshams Building Materials in the deal with the three businessmen who, at the time, operated a Jersey Island-registered firm, Barato Holdings Limited.
"The defendants shall pay to the plaintiff jointly or severally the sum of US$1 518 351,44 together with interest at the rate of 15 percent per annum from December 30 2004 to the date of full payment," Justice Samuel Kudya said.
"(They shall pay) costs of the suit on the scale of legal practitioner and client."
The court head that Alshams Building Materials released the money to Barato after the three businessmen convinced Shah that Barato had the capacity to pay back the money. Shah however, argued that the loan was never repaid.
Barato offered 42 299 673 shares in Ariston Holdings as additional security for the loan which the firm was obliged to repay by December 30, 2004.
After Barato failed to repay the loan Alshams cancelled the agreement and appropriated the Ariston Holdings shares deposited with it in August 2005.
The shares were then valued at US$683 753,44 prompting Alshams to sue over the shortfall.
Nyemba, Goromonzi and Sachikonye argued that they had since resigned from Barato and that the appropriated shares were worth more than the loan.
They added that the loan was repaid by way of dividend payment, together with the appropriated shares insisting there was, therefore, no debt.
However, the court found that the three "surely borrowed money" from the firm and that they should pay it back with interest.
Justice Kudya described Shah as "a truthful and highly credible witness" whose evidence was mostly unchallenged in court.