Mafabi, Katuntu fight over BoU probe

A row is brewing between Budadiri West MP Nandala Mafabi and his Bugweri County counterpart Abdu Katuntu over the stalled proposal to set up a select committee of Parliament to investigate the operations of Bank of Uganda (BoU).
Mr Mafabi petitioned Parliament in July last year calling for an investigation into the operations of BoU, particularly the circumstances surrounding the closure of Greenland Bank, National Bank of Commerce (NBC) and Crane Bank.
The envisaged committee would establish whether the central bank followed the law in closing the banks and why former shareholders of the banking institutions have not been furnished with reports detailing the plight of their investments in the banks.

The contention
But the proposed inquiry hit a snag after BoU Governor Emmanuel Tumusiime-Mutebile protested to Parliament that any inquiry into the closure of Crane Bank would “prejudice a fair trial and determination of the pending cases” relating to whether BoU reneged on its supervisory role.
Governor Mutebile’s protest letter to Parliament referred to three cases that are before the High Court – all related to the collapse of Crane Bank and whether BoU either reneged on its supervisory role in the process or was part of a collusion syndicate.

“We advise that the question of alleged mismanagement of Crane Bank Ltd and the role of any BoU officers therein is a subject of a High Court matter N0 362 of 2017 Derrick Nsereko vs BoU,” Mr Mutebile stated.
MPs Mafabi and Katuntu were, however, sucked into a deadlock over the inquiry after the Commissions, Statutory Authorities and State Enterprises (Cosase) chaired by Mr Katuntu protested that it was conducting a similar probe into the operations of BoU, further throwing efforts to investigate the bank into disarray.

With the inquiry dragging on for nine months now, Mr Mafabi, in an interview with this newspaper, accused Mr Katuntu’s committee of harbouring “vested interests” regarding the inquiry and handling Parliamentary business using “underworld” methods.
“Some of our colleagues brought the issue that the case is before their [Cosase] committee, which was wrong. The chairman [Abdu Katuntu] and his deputy [Anita Among]. That was wrong,” Mr Mafabi said.

Katuntu says...
Mr Katuntu, in response, said his committee is not interested in “scoring political points” and accusing BoU of frustrating the inquiry with the support of the Attorney General.
“When you see the letter by the Deputy Speaker to the Governor, does it mention Cosase anywhere? Why does Nandala bring in Cosase? We do not wish to score political points but we want to do a job,” Mr Katuntu said.
Mr Katuntu was referring to a letter dated August 3, 2017 by Deputy Speaker Jacob Oulanyah to the Governor agreeing that Parliament would not conduct any inquiries into the BoU’s role in the supervision and closure of the defunct banks until all related cases are disposed of.
“I have directed that Parliament and its committees do not investigate those matters until the disposal of the matters in court or until advised otherwise,”Mr Oulanyah wrote.

But Mr Mafabi said the Deputy Speaker “should come to his senses” and members of Cosase must appreciate the merits of the inquiry into BoU.
“I never expected him to have ruled as he did. I do not see a reason why a real Speaker should say we cannot investigate BoU. Does he want another bank to first collapse? He ruled that there is subjudice but there is no subjudice,” Mr Mafabi said of Mr Oulanyah’s decision.
Bank of Uganda has also declined to be audited by the Auditor General regarding the sale of NBC and Crane Bank.

In a letter dated November 28, 2017, the Auditor General, Mr John Muwanga, wrote to Mr Katuntu demanding for an inquiry by Cosase into defunct banks that were taken over by BoU.
Mr Muwanga demanded that the Cosase audit should establish the status of the banks at the time of collapse; cost of liquidation; assets and liabilities of the banks at the time of closure; status of non-performing assets; status of non-recoverable assets; and who is recovering what.

BoU writes to AG
In a letter dated April 19, 2018, Deputy Governor Louis Kasekende wrote to the Attorney General protesting the investigative audit of the resolution process of Crane Bank on grounds that the matter was still in court.
“We note that the Auditor General’s inquiry as per the said letter is based on a directive from the chairperson Cosase that appears to contradict the Speaker’s ruling with regard to investigations of the resolution process for Crane Bank Ltd (in Receivership),” wrote Mr Kasekende.
In a letter that Sunday Monitor has seen, the Solicitor General wrote back to the BoU Governor on May 2, , ordering BoU not to cooperate with either the Auditor General or Parliament regarding an investigation into the sale of Crane Bank on grounds that any such inquiry would offend the subjudice rule.

The Auditor General’s draft report to Cosase does not cover the circumstances surrounding the closure of NBC, Crane Bank and Teefe Bank because BoU refused to cooperate regarding the two banks.
Cosase chairperson Katuntu has rejected BoU’s refusal to cooperate.
“Entities being audited do not have the liberty to choose what should be audited. The arguments being raised by the bank of subjudice do not apply to auditing,” Mr Katuntu wrote on April 3.
The forensic report by the Auditor General into the defunct banks is envisioned to guide the committee’s inquiry.

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