COSASE probe: BoU officials fail to defend Shs900m paid to law firm MMAKS in Crane Bank sale

Parliament’s probe into Bank of Uganda’s sale and closure of several commercial banks has resumed in earnest and BoU officials were this Tuesday tasked to provide terms of reference under which they offered law firm MMAKS Advocates Shs900m as legal fees during the sale of Crane Bank. The BoU officials could not provide the documents.

The law firm was paid a total of Shs914m but BoU officials who appeared before Parliament’s Committee on Statutory Authorities and State Enterprises (COSASE) couldn’t provide terms of reference under which they engaged MMAKS.

They were also promised 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, but which didn’t show proof of work done.

It is this memo, the Governor Emmanuel Mutebile used as a basis to endorsed 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 probe continues tomorrow when BoU officials shall appear again this time accompanied with representatives of M/S J.N. Kirkland & Associates and Sil, the two firms that participated in the sale of assets of Greenland Bank, International Credit Bank and Cooperative Bank to Nile River Acquisition.