COSASE Rejects BoU’s Liquidation Documents for Defunct Banks

The Parliamentary Committee on Commissions, Statutory Authorities and State Enterprises (COSASE), chaired by Bugweri County Member of Parliament, Hon. Abdu Katuntu has rejected liquidation documents submitted by Bank of Uganda (BoU) officials, pertaining to the closure of the defunct banks.

On 21 November 2018, Hon. Katuntu directed the officials representing the Central Bank, Mr. Benedict Ssekabira (Financial Markets Development Coordinator), Dr. Tumubweine Twinemanzi, (Executive Director for Bank Supervision), and former employees, Mrs. Justine Bagyenda (the former Executive Director for Bank Supervision), Mrs. Margaret Matovu and Mr. Apollo Obbo to submit by 22 November 2018, comprehensive liquidation documents for the closed banks, including the appointment letter of Mr. Ssekabira, as liquidator for the banks.

Mr. Ssekabira had said on 21 November, that he did not know the whereabouts of his appointment letter but he would check with the bank.

However, while appearing before the Committee on 22 November 2018, the BoU team was asked by the chairman to withdraw their documents, on grounds that they did not meet the expectations of the Committee.

“The is content is there. The substance is there but the relevance to what we are interrogating is lacking,” Hon. Katuntu said. “The whole file is about requisition of money,” he added.

The files submitted included documents pertaining to; status of the loans, files showing requisitions for liquidation expenses and files showing legal cases.

Auditors representing the Auditor General’s Office argued that the documents did not pass as liquidation reports.

“We do not consider requisitions for liquidation expenses as reports. What we consider as reports of liquidation would be reports that provide the status of affairs from; the position when the liquidator assumed the role, the status of the assets and the status of the assets at the time the liquidator is reporting to the supervisor,” the auditors said.

They said the document for the status of loans did not state who prepared it, when it was prepared to whom it was addressed.

In her defense, Mrs. Bagyenda said the required reports are available at BoU.

“When you look at the handover report, you will see files of closed banks,” she said.

“The files have all the information on closed banks. It might be a presentation issue to discover reports from a liquidator but when you go through each closed bank, all the information is there,” Mrs. Bagyenda added.

Dr. Twinemanzi, acknowledged receiving the documents for Greenland Bank. They are:

  1. Legal issues
  2. Legal audit report
  3. Assignment final draft
  4. Special audit final report
  5. Statement of affairs 30 June 2016
  6. Suit by shareholders and other associated companies against Bank of Uganda and the Attorney General
  7. Legal audit report on Greenland and its associated companies
  8. Financial statements, audit and investigation of Greenland as at 31 march 1999
  9. Greenland Bank forex bureau audits
  10. Sale of movable assets appraisal report
  11. Transaction audit interim progress report

Hon. Katuntu directed Dr. Twinemanzi to produce all files regarding Greenland Bank on 23 November 2018. He said the files for Greenland will be used to establish the case for Uganda Cooperative Bank (UCB) and International Credit Bank (ICB).

The Vice Chairperson of COSASE, Hon. Anita Among directed Mr. Ssekabira to avail liquidator appointment letters for the other banks, as he had only submitted for Greenland Bank.

COSASE is probing the irregular closure of; Greenland Bank, Uganda Cooperative Bank (UCB), International Credit Bank (ICB), Crane Bank, Global Trust Bank, National Bank of Commerce and Teffe Bank.

Central Bank Governor, Prof. Emmanuel Mutebile said on 19 November 2018 that his staff did not furnish him with liquidation reports pertaining to the closure of the banks.

The appointed liquidator, Mr. Ssekabira said he had handed the reports to his then line supervisors, Mrs. Justine Bagyenda, Mrs. Margaret Matovu and Mr. Apollo Obbo who supervised the sale of the assets of the defunct banks, at the time.

The trio were ordered to appear before COSASE to explain the whereabouts of the liquidation documents.

However, Mrs. Matovu has admitted that although she received the documents from Mr. Ssekabira, she did not hand them over at her time of departure.

Some Members of Parliament have implored the chairman to invoke the special powers of the Committee, which compel production of documents by witnesses, through the Criminal Investigations Department (CID).

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