By Andrew Irumba
Kampala: Speaker Rebecca Alitwala Kadaga has changed her mind and instructed Kawempe South legislator Mubarrack Munyagwa to conduct fresh investigations into the operation of Bank of Uganda and how BoU officials sold seven commercial banks, especially Uganda Cooperative bank.
The seven banks that were closed between 1993 and 2016 by BoU include Teefe Trust Bank , International Credit Bank, Cooperative Bank, Greenland Bank, Global Trust Bank Uganda, National Bank of Commerce and Crane Bank Limited.
It should be noted that although BoU officials had been investigated by Abdul Katuntu, formerly the Chairperson Parliament Committee on Statutory Authorities and State Enterprises (COSASE), the investigation was not completed. When Munyagwa was appointed COSASE chairman, he attempted to reinstitute a thorough investigation into how Bou handled the sale of the commercial banks, but his efforts were frustrated by Kadaga. The Speaker argued that investigating what the earlier COSASE had investigated would be a wastage of Parliament’s resources and time. Munyagwa had even appointed a Sub-Committee headed by Makindye East MP Ibrahim Kasozi to reinvestigate BoU officials but Kadaga halted its operations.
She also blocked further inquiry into irregularities at BOU because Munyagwa had not sought clearance from her office and that his move would result in wastage of resources.
However, in a twist of events, Kadaga has instructed Munyagwa to resume investigating BoU officials and conclude what Katuntu had started.
In a letter dated 26 July, 2019, Kadaga instructs Munyagwa to consider the appeal of Chris Tushabe Karobwa, who alleges that BoU officials mismanaged issues of the Cooperative Bank in receivership, causing him a loss of over Ssh3Bn.
Tushabe also alleges that the committee under Hon. Katuntu partly handled his case but did not complete it.
Karobwa wrote to Kadaga on June 15th, stating that he was a victim of BOU fraud and that his “risky contribution in fighting and exposing corruption in BOU should not simply be washed away to benefit wrong doers.
He urged Kadaga to reverse her decision against investigations into BOU because ‘thieves’ must be punished. Karobwa claims that when Cooperative Bank was closed in 1997, he lost over Shs3 billion in cash and property worth Shs1.42 billion, and an overdraft of Shs600m which he never withdrew although BOU officials forced him to pay under duress. He added that he made the payments with the hope of getting his properties released, but that never happened.
He now claims that his quest for justice after a struggle of 20 years could be met if Kadaga allows Munyagwa’s committee to complete hearing his appeal and that of others who were affected by the closure of the banks.
In February this year, Katuntu presented a report on the matter, which among other issues demanded action against culprits, proposed changes in BOU and also noted the inadequate accountability on the Shs478 billion BOU invested in Crane Bank Limited before it was sold to DFCU Bank at shillings Shs200 billion in 2016.
But Katuntu’s recommendations have never been acted upon by parliament.
The Katuntu-led committee report into BOU, noted that some customers of the defunct banks petitioned the committee over irregular use of sale of securities, withholding of securities upon clearance of obligations, although nothing has ever been done about this by parliament.
The Committee concluded that “the management of securities during liquidation process has not been fully transparent. Indeed, BoU itself is still in possession of certificates of title which they have failed to explain.”
Parliament now waits COSASE Sub-Committee’s report about the how BoU officials exactly handled the contentious sale of the seven commercial banks.
