KAMPALA, Uganda — President Yoweri Kaguta Museveni has directed Finance Minister Henry Musasizi to explain how more than US$14.7 million (about Shs54 billion) intended to service Uganda’s external debt to the World Bank and the African Development Bank was allegedly diverted to private companies in the United Kingdom and Japan.
The President’s directive follows a report by the Financial Intelligence Authority, which reportedly uncovered suspicious transactions involving loan repayment funds that were due during the final quarter of 2024. In a letter dated June 14, 2026, Museveni demanded a comprehensive explanation from the Ministry of Finance on what happened to the money, who diverted it, and who ultimately received it.
“I demand a report of what has happened to this money, those who diverted it (stole it) and those who received it,” Museveni wrote in the letter, which was copied to senior government officials, including the Vice President, Prime Minister, Inspector General of Government, Attorney General, and heads of the country’s security agencies.
According to the Financial Intelligence Authority report cited by the President, the diverted funds comprised US$6.13 million that had been earmarked for repayment to the World Bank’s International Development Association (IDA) and US$8.59 million intended for the African Development Fund (ADF), the concessional lending arm of the African Development Bank. Instead of reaching the multilateral lenders, investigators allege the money was transferred to Roadway Company Ltd in Tokyo, Japan, and MJS International Ltd in London, United Kingdom.
A government forensic audit reportedly found that fraudsters manipulated payment instruction files generated through the government’s Integrated Financial Management System (IFMS) before they were encrypted and transmitted to the Bank of Uganda for processing. The altered instructions substituted the legitimate beneficiaries with the two foreign companies, enabling the diversion of the funds.
The scandal has already triggered criminal proceedings against several senior officials from the Ministry of Finance. Prosecutors allege that weaknesses in internal financial controls enabled the fraudulent transactions, which investigators say were carried out in September 2024.
The alleged theft is considered one of Uganda’s most significant public finance scandals because the funds were intended to meet the country’s international debt obligations. Failure to honour such repayments could damage Uganda’s creditworthiness, increase borrowing costs, and strain relations with international development partners.
The case also comes at a time when Uganda’s external debt remains under close scrutiny. Ministry of Finance figures show the country continues to carry billions of dollars in external obligations while seeking additional financing for infrastructure and development projects.
Investigations into the diversion are ongoing, with multiple government agencies expected to determine the full extent of the fraud and whether additional officials or external actors were involved.
