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Bank Of Africa Looking For “Whistleblower” In Alleged Deposit Mismanagement

Bank of Africa Uganda (BOA) is investigating the source and motives behind a number of letters circulating about the alleged management at the bank. The letters posted on various social media sites point to a number of incidents deemed unprofessional and illegal, allegedly committed by fraudsters and top management. The reports, which the Bank management has called false, have raised anxiety among the customers of the bank seeking guarantees of the safety of their deposits.

The silence of the Bank of Uganda, the industry regulator, despite several requests for an explanation on the matter, is fueling public anxiety. The letters dated between September 29 and October 5, are written in print and, despite bearing names and signatures of the alleged whistleblowers, do not bear contacts. On September 29, one Moses Mukasa, Printers Arcade, Nasser Road in Kampala directed his concern to “the Governor, Bank of Uganda”, claiming he landed on a draft document aimed for use to make false payments by the bank. “I have personally seen several people on this Nasser Road premises processing fake court garnish orders to be used in Bank of Africa Uganda,” he wrote.

A garnishee order is a method of enforcing a court judgment, allowing the recovery of money from the judgment debtor. At the Printers Arcade, the operators admitted that they receive various orders to print documents, some of which are evidently forgeries. However, they could neither admit it nor deny printing garnishee orders to BOA. An open letter by one Abubakar Kiberu aimed its attack towards the top management including the Managing Director Arthur Isiko, as being responsible for the high staff turnover due to mistreatment like poor pay.

“As if that is not enough, his poor people management skills are driving the unavoidable collapse of the bank. It’s just a matter of time if he doesn’t step aside. We need new management,” says the writer, who describes himself as a senior manager. The underpayment, the writer says, is leading to employees stealing money from customer accounts. “Even some top officials are involved in these games. Conniving with and asking for cutbacks on customer loans is the norm. I won’t mention names but Kidawalime and Great Lakes are incidents I can’t keep silent about.”

Another query the writer claims is the lending to staff above the laid down limits, as well as stealing money from the bank using what he calls internal rackets. “The newest racket involves our legal team and some senior staff officials that I fear to mention here because of fear of being fired by Arthur Isiko (MD) who has worked with tellers to identify and steal funds from dormant customer accounts using Nasser Road forged court garnishee orders.”

Kibera claims that over 700 million shillings have been “systematically” siphoned. “At the moment, there is an internal audit on a case of 500M stolen using forged Nasser road garnish orders, but nothing positive will come out because the internal auditors are on huge MD pay cheques.” The whistleblower calls for an independent external audit on these forged garnish orders but after the MD is sent on leave “like he has done to the Executive Director, or absent from the station so that staff under him don’t fear to volunteer fraud information on scandals where the MD is personally involved.”

The matters relating to lending against the bank and known beat practices were repeated in another letter addressed to the Deputy Governor, of the Bank of Uganda. The letter by one Kasoma David on October 1, says over the last ten years, BOA has consistently been in breach of the policy where an employee can only get loans from the bank up to three times the annual gross pay. The whistleblower’s letter says this is exposing the liquidity of the bank and most likely infringes on the minimum capital requirement of the bank.

“Just like Crane Bank in liquidation, I suspect BOA has been submitting altered audit reports for it to appear like the Bank is a float whereas not,” the whistleblower says. The writer claims that the MD sent the ED on leave so that when the October Audit starts the latter will not be around to defend themselves should there be accusations. On October 5, another letter in the name of Kinene David of NateeteP.O Box 1241 Kampala, calls for the intervention of President Yoweri Museveni into the issues surrounding BOA, to avoid a repeat of “what happened with Greenland Bank and Crane Bank.”

The two were closed by the Bank of Uganda over management issues including violation of insider lending policies. The letter calls on the president to institute an independent investigation. Apart from the claims mentioned in the other letters, the petition to the president also alleges that some bank staff give money to outsiders to trade in Financial products like foreign exchange and return it with a commission by the close of the day.

It also claims siphoning off cash from the dormant accounts by staff. “Some insider staff are stealing money from dormant accounts using forged court orders. Eg. Ivan Matende an insider staff on five occasions successfully drew millions of shillings from dormant accounts in the bank. There are several other such cases.” While the bank says all these are false allegations, it says investigations are going on. “Kindly be advised that the allegations are not true. They are people trying to tarnish the bank’s image.”

The bank says it is aware of the circulating information but that all customer deposits are safe and the bank has not deviated from its operations standards. “Bank of Africa maintains the highest standards of financial integrity and security. All customer deposits are safe, and our financial standing is sound as reflected in our recently published financial statements.” BOA is a subsidiary of the Bank of Africa Group with 18 commercial banks in different countries. “We are taking legal steps to address this false information and will keep you updated on the progress,” says the bank in a statement.

-URN

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