The recently resigned Equity Bank Executive Director Kenneth Onyango has been arrested in relation to a Shs65 billion fraud case that the bank is embroiled in.
Onyango had spent eight years at Equity Bank and served in various positions including Head of Risk, Head of Operations and Head of Business before being promoted to his last posting as Executive Director.
He quit Equity at the beginning of last month, around the same time the bank admitted digital lending fraud.
Several other Equity Bank staff including Julius Musiime, the Head of Agency Banking; Erina Nabisubi, the Relationship Manager Telecom; Fred Semwogerere, a banker; Cresent Tumuhimbise Tibarwesereka, the Relationship Officer and Wycliff Asiimwe, a distribution and marketing consultant., were already sent by the Anti-Corruption Court on remand in Luzira in relation to the multi billion fraud.
The fraud was committed with bank staff colluding to lend large sums of money to undeserving clients who either didn’t qualify for the loans or didn’t put the money to its intended use.
Equity Bank admitted to the fraud in a recent statement going on record that; “We regret to inform you that we have recently identified a possible fraud on our Stock Loan and Agent Float Financing products.”
The stock loan product, is a credit facility meant to support entrepreneurs, small and medium-sized enterprises (SMEs), and large businesses across various sectors with working capital for growth and expansion.
‘Agency float financing’ on the other hand is a loan product to support Equi Duuka agents with float to continue running their agency businesses.
“People of interest, including a few of our staff and customers, are currently assisting with investigations by the relevant law enforcement authorities. We hold ourselves to the highest standards of accountability and transparency, and the persons found to be responsible, whether through fraud or through errors of commission or omission will be fully addressed in accordance with the policies, procedures and ethical values of the organisation and, where appropriate, the laws of the country,” the bank’s official statement on the matter read.
Two former employees of mobile telecommunications giants Airtel; Godfrey Mukwaya and Robert Mugumya were arrested and detained at the Central Police Station in Kampala last week in relation to the case.
Kampala Metropolitan Police spokesperson Patrick Onyango confirmed the arrest.
“They are in our custody on the allegations of causing financial loss,” Onyango said.
Mugumya, one of the two suspects is linked to 179 fictitious companies that were created to defraud Equity Bank using different persons to obtain more than Shs35 billion.
It is indicated that Mugumya is the proprietor of Stab group of companies comprising mobile money outlets, mobile banking, hotels and a hospital.