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War loss compensation: Treasurer of Lango Cooperative Union arrested

LIRA, September 7, 2023 –  A top official of Lango Cooperative Union [LCU] was detained overnight at Lira Police Station for allegedly mishandling part of the Shs 6 billion that government released to the union as compensation for the assets lost during wars and political instabilities in Uganda.

Robert Akona, the treasurer of LCU was sent to police after appearing before Parliament’s Committee on Tourism, Trade and Industry headed by Mbarara City South Member of Parliament, Mwine Mpaka.

Akona was sent to record a statement at the police station after failing to provide accountability for Shs 250 million he claimed was used for clearing debts the union had with Stanbic Bank Uganda.

The chairperson LCU board of directors who is also the Maruzi County Member of Parliament Maxwell Akora Patrick never surfaced.  His vice, Tonny Ogwal, and Mary Alip, the union`s accountant showed up before the parliamentary committee.

The parliamentary committee is investigating the war loss compensation paid to cooperatives in the country. In Lira, they held a closed-door meeting with the leaders of LCU.

Journalists were turned away in what they described as a confidential meeting at the Lira district council hall for nearly five hours.

After several hours, Akona was whisked away by a parliamentary van to Lira police station at around 4:00 pm to record a statement.

The committee didn’t speak to the media after the meeting but Ogwal, the vice chairperson of LCU said one of the staff had been picked to record a statement at the police.

“They asked a lot of questions regarding the money we received including how it was released to us because there was information that some unions were paid through a lawyer but for LCU we received the money directly from the Ministry of Finance,” Ogwal said when journalists cornered him.

LCU was founded in 1952, had 144 primary societies, with the stated aim of alleviating poverty and promoting cotton growing in Lango Sub-region.

However, the primary societies became non-functional due to fluctuation of cotton prices and defaulting on loans taken from financial institutions, all of which weakened the union.

As LCU came to its knees, cotton growing, buying, ginning and selling were badly affected, rendering its 144 primary societies inactive.

Before the downfall of the union, it obtained Shs 2.4bln from the microfinance Support Centre [MSC] to fiance cotton growing in Lango- Sub region but failed to pay back the loans on the ground that the season was bad.

This prompted MSC to sell off its ginnery at Ngetta to Ngetta Tropical Holding to recover part of the loan.

Meanwhile, the registrar of cooperatives in the Ministry of Trade, Industry and Cooperatives [MTIC] was arrested from Rukungiri district days ago over allegations that he participated in the embezzlement of over 20 billion shillings meant to compensate cooperatives for losses incurred during wars and political instabilities in the country. Other officials at MTIC are being investigated over the same matter.

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