IGG sets probe date for alleged fraud at NSSF

The Inspector General of Government has reduced, to 10, the fraud and mismanagement allegations against the top leadership of National Social Security Fund.

In an interview with the Daily Monitor, Ms Irene Mulyagonja said everything has been put in place and the investigation will start on May 20 by a team of four top investigators.

“The allegations brought forward by the whistle-blower totalling up to 25 have been broken down into 10 bigger categories to ease the work, but I cannot tell the time frame for the investigations,” Ms Mulyagonja said.

The 10 broader categories, among others, include fraudulent transactions, mismanagement by the top managers and abuse of office.
“I am confident that the team will get to the bottom of everything,” she said.

A fortnight ago, a whistle-blower leaked a 24-point document to the Daily Monitor, accusing NSSF top management of mismanaging the workers’ savings by flouting laid down procedures and ignoring expert opinion for self aggrandisement.

One of the fraudulent transactions, the whistle-blower mentioned, is the sale of a plot of land in Namirembe, a city suburb, at Shs650 million to Malibu Holdings Limited yet the property valuer, Mr Denis Lutaalo, had put it at Shs1 billion.

NSSF’s response
Mr Lutalo had asked the NSSF leadership to either sell the land at the real market value or drop the idea of selling it because the Shs650 million was below the cost of the plot by Shs56 million in normal terms and Shs814 million in real terms.

However, in a communique to the Daily Monitor, the NSSF managing director, Mr Richard Byarugaba, said the Fund resolved to dispose of all the plots because they were idle assets tying up money that would otherwise be earning income.

“The land sale was authorised by PPDA, the Contracts Committee, the accounting officer and the Solicitor General. ,” his statement read, adding that the land in question had no access road.

“The Fund did not deem it necessary to apply for an access road because it was not intending to develop the land, and the prospective buyer owned all the surrounding land, reason why PPDA approved direct disposal to that bidder,” he said.

The Inspectorate’s spokesperson, Ms Ali Munira, acknowledged the existence of Mr Kasirye, who was also accused of hobnobbing with the top NSSF bosses to bury the rot from reaching the IGG’s office.
“The IGG is in the know of the circumstance in which Mr Kasirye met with the NSSF managing director and it will be investigated,” she said.

However, Mr Byarugaba, in his communique to this newspaper said the deputy managing director’s visit (to the accused IGG staff) “was official”.

Further, the dossier also says the NSSF leadership also committed Shs25 billion of workers’ savings to buy shares in Umeme Ltd without green light from the Solicitor General, who advised the Fund that the transaction was irregular.
A copy of a January 10 letter from the Solicitor general to the NSSF Corporation Secretary shows that NSSF Management jumped the gun and purchased the shared without approval and attempted to secure it retrospectively.

NSSF and Umeme shares
However, the Fund’s managing director said the investment in Umeme was undertaken in line with NSSF’s investment procedures and after a thorough due diligence.
“Currently, Umeme is trading at Shs315, up 14.5 per cent from the listing price. With all the Fund’s trades in the secondary market executed at Shs275, the Fund’s average purchase price, inclusive of trading fees, is only Shs276. The value of our investment has, therefore, appreciated by Shs5 billion in less than 6 months.”

However, Minute 77.8 of the 5th Extra-ordinary meeting of the December 18, 2012 ninth board meeting says members noted with concern that the board was not involved in approval of the transaction (buying of Umeme shares) amid reports of conflict of interest.

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