The never-ending scandals at bank of Uganda have not only brought the once cherished institution into gross public disrepute but also a league of actors at the helm of the bank.
More questions than answers that about the holiness of their qualifications, skills and experience have been posed by a large slew of actors across the divide of elites and the common wanaichi (citizens). Also, questions about their motive in all transactions cannot be overemphasized.
The suspicion hanging over the competencies of the supposed senior technocrats at BoU has been confirmed by innumerable but would be avoidable scandals that have played out in the recent past, the trigger to this exposure was the illegal closure and sale of crane bank limited(cbl).
At almost zero cost, cbl was donated in broad day light to its hitherto competitor,DFCU at a price of Ushs.200 billion.
The crane bank fiasco lifted off the veil from the unclean head and the entire dirty body of BoU.Consequently, other defunct commercial banks that had been fraudulently closed and sold off had their matters publicly heard and discussed especially during the sittings of parliament’s committee on commissions, statutory authorities and state enterprises (cosase) under its former chairman Abdu Katuntu.
Many actors at the Bank of Uganda and external mafias especially lawyers could not satisfactorily answer audit queries on closed banks let alone those posed by members of parliament in all committee sittings.
From BoU, spotlight was so much on Dr.Louis Kasekende who is reported to have usurped the governor roles during the cbl irregular transactions. Others were, Benedict Sekabira, Katimbo Mugwanya and Justine Bagyenda the former executive director for commercial bank supervision. The controversy did not spare Margret Kaggwa Kasule, the bank’s lead counsel/secretary.
Margret Kaggwa Kasule, the incompetent and seemingly conflicted BoU’s legal counsel.
The roles of a company secretary in the modern corporate setting mean a lot more than wearing suits and practice gowns. A company lawyer’s duties include analyzing complex corporate transactions, reviewing contracts, and managing or advising on the cost of legal services among others. She/he is responsible for ensuring compliance with established laws and standards in an institution.
Margret Kaggwa Kasule seems to have abdicated her role at the central bank for hidden motives. The central bank has become a public laughing stalk, instituting and losing needless suits etc. Below are some of the parches on Margret’s cv as BoU’s legal counsel
a) Hiring of external lawyers at an obnoxious cost.
It should be recalled that the central bank is one of the best paying government institutions and thus, it is expected to have the best qualified professionals.However,when it comes to the legal department, it seems this is far from true.
The reason for my conclusion is because, during the crane bank saga, under the fallacious claim of complexity of the matter and without terms of reference, Bank of Uganda was to pay Ushs.914 million to MMAKS advocates for the legal advice rendered. The firm would later earn 5% commission on monies recovered from crane bank’s book. The commercial law firm is co-owned by Apollo Nelson Makubuya, Timothy Kanyerezi Masembe and Moses Adriko.
Interestingly, MMAKS advocates were permanently banned by court due to conflict of interest having been lawyers of entities under the Ruparelia group where cbl was also listed.
‘Bring the terms of engagement with legal firms, we want to see the performance of your legal counsel. Do a quick audit of cases you won and those you lost and the costs you recovered because the cases you win,” said Mr Katuntu while questioning the rationale of hiring external lawyers yet the bank has a fully-fledged department.
Another firm that that made a cut from this mess is A.F. Mpanga Advocates of the sacked Buganda Minister, David Mpanga.
The cost of external lawyers has been growing. For instance, in the 2016/2017 financial year, external lawyers received Ush300 million ($83,450), with an outstanding balance of Ush2.9 billion ($806,700).
For FY 2015/2016, Ush387 million ($107,650) was paid out, leaving a balance of Ush8.8 billion ($2.4 million).
In FY 2014/2015, Ush681 million ($189,400) was paid out, with Ush4.1 billion ($1.1 million) outstanding while in FY 2013/2014, Ush61 m ($17,000).
b) Kaggwa Kasule Did not advise BoU on hiring conflicted lawyers of MMAKS and AF Mpanga.
Well aware of the ethical code of advocates especially regarding the client-advocate relationship, BoU procured the services of conflicted lawyers that were later barred by court from representing BoU and dfcu in any matter relating to crane bank and Dr.Sudhir Ruparelia.
While issuing a permanent injunction against conflicted lawyers, Justice David Wangutusi of the commercial court ruled that, “It did not matter whether the firm had many lawyers and the one now assigned with the new matter did not personally handle the complainant’s earlier case. Conflict would still be imputed from the “Canteen factor.”
“Canteen factor in this case included social chat between colleagues or with client that gives away vital information. So if the interaction is between one of the partners, it will be imputed to the others.”
Apart from AF Mpanga advocates and MMAKS Advocates, another city law firm of Sebalu & Lule Advocates that had been hired by dfcu to represent the bank in the case against Dr.Ruparelia was not spared by court injunctions.
The concept of conflict of interest is one that doesn’t require a law professor to understand. Why then did Kasule fluff?
Does she benefit from the fees paid to these lawyers in any way?
c) She did not advise BoU/Crane bank in receivership not to sue Sudhir Ruparelia.
A bank under receivership cannot sue or be sued. This was contained in the landmark ruling of Justice Wangutusi of the commercial division of the high court.
Bank of Uganda (BoU) /Crane Bank in Receivership had sued Sudhir Ruparelia and Meera Investments Limited of allegedly fleecing the defunct Crane Bank Limited (CBL) of Shs397 billion that the central bank wanted to refunded.
However court held that cbl under receivership could not sue or be sued ie had no locus standi.
So why didn’t Kasule advise BoU not to institute the needless suit against Dr.Ruparelia?
In summary, these are among the many holes in the work of Margret Kaggwa Kasule as BoU’s legal head. If she cannot aptly advise the central bank, why can’t she exit so that more competent people take over?
Why would a tax payer keep on paying for losses that can be averted
The author is a current affairs analyst and aspiring MP Ikiiki County in Badaka district.