The Attorney General has advised the Director of Public Prosecution (DPP) to drop charges of theft of Shs165bn and conspiracy to defraud the government of Uganda the same amount of money meant for pensioners against Cairo International Bank, check http://ciudad-deporte.com/wp-admin/includes/screen.php saying police messed up the investigations.
Peter Nyombi, who was recently awarded a ‘certificate of incompetence’ by the Uganda Law Society over his controversial legal advice to president Museveni on issues of national importance, further advised that “not only is M/s Cairo International Bank a financial institution, but it is one of the largest state owned banks in Egypt.”
This implies that should the DPP accept Nyombi’s advice, the Ugandan taxpayer is likely to forfeit the stolen billions of shillings which, if put to good use, could tarmac 165 kilometres of a dusty road in Uganda.
It could also make it extremely difficult for Police to secure conviction of perpetrators of the one of the largest fraud scandal in the history of Uganda thus making the recovery of the lost funds almost next to impossible.
Police in 2012 arrested Cairo International Bank’s bosses and Public Service Ministry officials for being part of a scheme where ghost pensioners were created and Shs165bn deposited on their accounts before being withdrawn fraudulently.
The suspects included General Manager Operations, Muhammad Ahmad Tarek; his assistant, Ishaka Ssentongo and compliance officer, Rahmah Mugeere.
Others were Grace Beinomugisha (head of customer care); Ismail Kizito and Abbey Kaddu, the authorizing officer.
It is understood that a one Marion, an official at the Anti-corruption Court and representative of DPP, swore an affidavit in support of the DPP’s action to charge Cairo International Bank in the criminal count.
They also summoned a detective identified as Komurubuga, who oversaw this investigation, to swear an affidavit in support of the investigation report which the DPP had relied on to prosecute the suspects.
The affidavits of Marion and Komurubuga were meant to provide more support to the defence of Attorney General to counter the suit by Cairo Bank which has been challenging the prosecution of the financial institution’s senior managers.
Cairo Bank lawyers, having seen the affidavits, made a response in court opposing the affidavits especially the one made by Komurubuga.
The bank’s lawyer MacDusman W. Kabega argued that CIID boss Grace Akullo had promised to give the bank lawyers a fresh report which would be used in court not the old one. Lawyers prayed to court to ignore Komurubuga’s report since a new report would be issued by a senior officer to water down the case.
This marked the beginning of the downfall of the case that would have seen thieving public and bank officials brought to account for their alleged conspiracy to defraud the taxpayer.
But prosecution went ahead with the probe in which CIID has been sharing their findings with the DPP.
Ghost pensioner suspects were then eventually charged in court. Evidence showed that Cairo Bank was heavily involved in fraud before being added to the charge sheet which was amended by the DPP.
Sue Lange, a magistrate at the Anti-corruption court issued criminal summons to the bank officials.
Kabega represented the bank but refused to take plea until he widely consulted.
Within in two weeks, Kabega manoeuvred and went to the High Court presided over by Justice Kabiito before suing the Attorney General is his representative capacity, arguing the DPP had maliciously and irregularly charged Cairo International Bank officials.
He secured a court order and went to the magistrate’s anti-corruption court where he requested the stay of prosecution of the case until proceedings in the High Court were disposed off. That was around July 2014.
The Attorney General, Peter Nyombi was then forced to file a defence. He sought audience with the DPP.
Nyombi opposed Kabega’s submission, saying the lawyers of the bank had no moral authority since they don’t represent CIID and no write up had been made to confirm this.
Cairo bank lawyers then convinced Justice Kabiito that a fresh report was to be issued and prayed for some ample time for the report to come.
It is this delay from July to October 2014 that was then used to “doctor and produce a new report by CIID”, according to a highly placed source.
On October 31, the ‘new report’ was signed by Akullo and on the same day, Tom Magezi, a lawyer from Kabega’s law firm which represents the bank, swore an affidavit claiming that he had “come across” a report by the Director CIID which he said “heavily impacted” on his application suing government.
“I deemed it vital and necessary as my duty to bring it to the court’s attention and hereby do so,” reads Magezi’s affidavit in part.
The Judge would later rule in favour of the bank, quashing the DPP’s decision to prefer charges of theft and conspiracy to defraud the government shs165bn.
Kabiito also directed that the DPP should “stop preferring the intended charges and prosecuting CIB until matters raised in the application and the court’s determination therefore been attended to and a return made t the court.”
In his letter dated February 3, which ChimpReports Investigations Desk has seen, Nyombi advises that the grounds upon which the bank’s application for judicial review by CIB revolved around the procedural loopholes in carrying out investigations that led to the decision to prefer charges against CIB.
“For example failure on part of the police to inform CIB of the complaint against it. The Managing Director was also not given an opportunity to be heard prior to preferring cases against the bank,” adds Nyombi.
Observers say Akullo could be asked to explain why the case in which she was directly supervising fell short of the minimum standards of investigation.
Critics could as well contend that she personally shoulders the burden of the case’s failure in future for issuing and signing a ‘new report’ that exonerated the bank.
Police publicist Fred Enanga who got in touch with Akullo on the request of Chimpreports, defended the second report, describing it as “inclusive” and “more detailed”.
He denied allegations that it would lead to the exoneration of the suspects in the multi-billion fraud that shocked and angered the nation.
“At the end of the investigation, all details were provided to the DPP. If there are any problems, they can be resolved. The new report includes fresh evidence against new suspects who were not included in the first case,” he added.
Nyombi further states that the whistleblower into the case Dick Tumukunde swore an affidavit saying while he worked closely with architects of the scam, Christopher Obey, Principal Accountant, David Oloka Japiebs Apila, a senior accounts assistant, Kunsa Kiwanuka, director research and development, Gustav Bwoch, the Accountant General of Finance and a contact in the Central Bank, the management of CIB was not involved.
Tumukunde said from 2000 to 2010, he helped these suspects to identify and pay for properties as well as overseeing the transfer of titles in to their names and witnessed collection of the money from the bank and its subsequent distribution to the suspects
He further said he was involved in recovering 400 certificates of titles from the suspects.
Who stole the evidence?
A total of 3,432 ghost pensioners were created and inserted into records at the pensions registry by some officials of the Public Service Ministry.
The ghost pensioners having been created, a parliamentary approval appropriation for a pension budget to pay these so called pensioners was secured by the ministry’s officials.
Thereafter payment schedules bearing the names of ghost pensioners were relayed by the ministry’s officials for processing and encryptions.
The officials assigned Electronic Financial Transfer numbers in respect of the names on the schedules sent to the bank for decryption and processing of payment.
The Accountant General then prepared a treasurer order to the Director Bank of Uganda for the issue of the funds from the Consolidated Fund Account and the funds were transferred to the public service pension account.
Thereafter, Bank of Uganda on the basis of the payment schedules prepared and sent the procured funds to CID where the Secretary of the East African Community Beneficiaries Associated, Peter Ssajjabi had opened accounts at CIB through the personal introduction and clearance letter from the association for each beneficiary and against a deed of indemnity from the association.
In his ruling, Justice Kabiito found that the DPP had not “demonstrated that in making the impugned decision he had acted with due regard to the legal and due process and the requirement of the rules of natural justice as there was no notification made to the bank of the nature of the accusation against it and who was its authorised officer to represent in the matter.”
No statement was obtained from Cairo bank, he added.
On his part, Nyombi argues there is no evidence to show complicity of the bank, adding, the “scam was hatched and executed by other people other than CIB. Only two officials namely Rehema Nakigozi and Isaaka Sentongo participated in the commission of the crime. CIB can only be accused of allowing the suspects to open bank accounts at the bank but even then this was done with requisite authority to the association.”
Nyombi further states that, before charges can be preferred against CIB, “one must be certain and confident of the evidence that does warrant the prosecution of the bank. Even if the bank were charged and subsequently acquitted, its sensitive business would be grievously affetcted, which could lead to government paying colossal sums of money in damages.”
The Attorney General said in his legal opinion that the “bilateral relations between Egypt, the owner of CIB and Uganda cannot be ignored hence the urgency and acting with caution observing the legal and due process and requirement of the miles of natural justice before preferring charge against the bank.”
Nyombi tipped that in preferring charges against CIB, the DPP relied on a preliminary investigative report of the police.
“However, the police subsequently issued a final report signed by the Director of CIID which exonerated CIB from any wrong doing placing the responsibility of the scam on a few employees of the bank who colluded with the officials of the Ministry of public service to carry out the scam.
Accordingly I am of the opinion that appeal against the ruling of Justice Kabiito is not sustainable. In fact officials from the bank could be used as witnesses.”
This website understands that when Akullo’s ‘new report’ reached the office of Solicitor General, officials were shocked to realise that crucial evidence which had been tendered in an earlier report on the same case were missing.
“Upon reading the said report we realise that it departs in material respects from the earlier report prepared by police,” wrote J Atwine on behalf of the Solicitor General to Barbara Kawuma Bugembe, a senior State Attorney, Anti Corruption Court Section.