Former Bank of Uganda (BoU) Executive Director in-charge of commercial banks Supervision, Ms Justine Bagyenda finally accepted to have carried documents out of the central bank but maintained that she carried personal documents related to her consultancy work and not the sale of commercial banks; this was during last Wednesday while appearing before Cosase committee
Ms Bagyenda said this while she and other BoU officials were appearing before Committee on Commissions, Statutory Authorities and State Enterprises (Cosase) for questioning over controversial closure of seven commercial banks whose vital documents relating to transactions have since gone missing.
In late November ms Bagyenda was at it again tough as she was to answer mob questions regarding the missing inventory reports and others. Benedict Sekabira, the Director Financial Markets Development Coordination in December said it was only Bagyenda who could reveal where some of the files were. Suspicion was that Bagyenda picked files when she was in February 2018 fired unceremoniously by the Governor Prof.Emmanuel Tumusiime Mutebile, six months to her retirement.
As Executive Director of supervision, her role was to ensure the stability of the banking industry but her boss sacked her after the Crane Bank saga emerged.
It’s said that Ms. Bagyenda was heavily involved in the controversial closure and sale of Global Trust Bank Uganda (GTBU) Crane Bank Limited (CBL) to Dfcu Bank in July 2014 and January 2017 respectively.
CBL was sold on credit at Shs200 billion that is being paid in installments, with the central bank claiming it spent Shs478.8 billions of taxpayers’ on CBL before selling it to Dfcu Bank.
Cosase does not have all the required documents of defunct banks because BoU staff have since failed to present all of them as required, with claims that some are misplaced somewhere within the bank, even though it has an archive department.
Sources within BoU said Ms. Bagyenda worked closely with BoU’s Deputy Governor Dr. Louis Kasekende in the closure and liquidation of some of the banks, like CBL whose closure caused the on-going Cosase probe.
BoU director of security Milton Opio in November told MPs that Ms Bagyenda facilitated the theft of documents from the central bank. Opio said that their CCTV camera’s captured Bagyenda’s assistant’s smuggling bags of documents from the central bank early this year.
Opio made the revelation under the directive of BoU governor Emmanuel Tumusiime Mutebile, who had been tasked to explain whether the central bank had any case of stolen documents.
Meanwhile, BoU officials were on last Tuesday tasked to provide terms of reference under which they offered law firm MMAKS Advocates Shs900 million as legal fees during the sale of Crane Bank. The BoU officials could not provide the documents. It also emerged that Sekabira was responsible for payment to the law firm instead of Kitimbo Mugwanya.
The law firm was paid a total of Shs914 million but BoU officials who appeared before COSASE couldn’t provide terms of reference under which they engaged MMAKS.
It was now discovered that its Bagyenda who drafted the terms of reference between BoU and MMAKS, a job that should have literally been for the Bank’s legal department.
The firm was also paid a further Shs3 billion as commission for monies recovered from Crane Bank shareholders.
The probe follows an Auditor General’s report that probed the closure and sale of seven commercial banks and pointed at possible corruption within BoU. While querying the law firm’s payments, some MPs argued that the payments could have been inflated to benefit corrupt BoU officials.
The MPs pointed fingers at the embattled former Executive Director in Charge of Commercial Bank Supervision Justine Bagyenda as a possible beneficiary, but she read to the MPs a memo/document dated November 30, 2016 requesting for payment of the lawyers, though it didn’t show proof of work done.
The Governor Tumusiime Mutebile used the memo as a basis to endorse payment of US $51,000 (Shs180 million) as part payment of the legal fees in December 2016.
The Committee Chairperson Abdu Katuntu, said it was wrong for BoU not to have proper records on the particular transaction.
The closed banks include; Teefe Bank (1993), International Credit Bank Ltd (1998), Greenland Bank (1999), The Co-operative Bank (1999), National Bank of Commerce (2012), Global Trust Bank (2014) and Crane Bank Ltd (CBL) that was sold to dfcu in 2016.