BoU moves to audit Crane Bank afresh

One of the branches of the defunct Crane Bank branches that had been taken over by dfcu Bank. PHOTO/FILE

What you need to know:

  • According to the advert, the bidding process is open until December 2.

Bank of Uganda (BoU) is currently looking for a competent audit firm to carry out a comprehensive audit on the current state of affairs of defunct Crane Bank, six years after the same commercial bank was closed.
According to a newspaper advert published yesterday in one of the local dailies, the Central Bank is now open to receive bids from interested audit firms to carry out the audit.
“Bank of Uganda invites sealed bids for eligible bidders for procurement of an audit firm to conduct a comprehensive audit on the state of affairs of the defunct M/S Crane Bank Limited,” reads in part the advert.

“The bidding document may be inspected online under the procurement tab on the bank of Uganda website…issued to interested bidders upon payment of $50 by funds transfer…,” the bid advert further read.
The bidding process is open until December 2.
On October 20, 2016, Crane Bank was placed under statutory management by BoU, pursuant to sections 87 (3) and 88 (1) of the Financial Institutions Act for being undercapitalised.
BoU, pursuant to Section 94 of the Financial Institutions Act, placed the bank under receivership with some of its assets and liabilities sold to dfcu Bank.

On June 30, 2017, Crane Bank in receivership, filed a commercial case before the High Court Commercial Division in which it was seeking to recover at least Shs397b from the majority shareholders in the bank, Mr Sudhir Ruparelia.
The property mogul was being accused of misappropriating the funds as the bank director and shareholder with his Meera Investment Company.
But on August 29, 2019, then presiding judge, David Wangutusi dismissed the multibillion commercial dispute on grounds that Crane Bank in receivership lost its legal powers “to sue” Mr Ruparelia or “to be sued”, the moment it was placed under receivership.

Court battle
Crane Bank in receivership was dissatisfied with the decision of the Commercial Court and lodged an appeal before the Court of Appeal, which was equally dismissed on similar reasons.
But still being dissatisfied with the judgment of the Court of Appeal, Crane Bank in receivership, appealed to the highest court in the land (the Supreme Court), but withdrew the main appeal even before the court could hear it out.

Crane Bank was not satisfied that the orders of the Supreme Court that also included that its management reverts to the original shareholders, a contestation that the court dismissed in July this year. Last month, a High Court in England decided in favour of dfcu Bank, its directors and shareholders in a case filed against them by the defunct Crane Bank and six of its directors, seeking Shs816b (about 170 million pounds).

When contacted yesterday, Ms Charity Mugumya, director communications at BoU, asked whether the reporter is also interested in taking up the auditing job before asking him to send her an email.
By press time, Ms Mugumya had not yet replied to our e-mail seeking clarification on why the Central Bank wants to audit the defunct Crane Bank.
 

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