BY MUHEREZA KYAMUTETERA
KAMPALA – Last week, news came through that Finance Minister Matia Kasaijja had reappointed former Bank of Uganda Executive Director in Charge of Supervision, Justine Bagyenda, back to the board of the Financial Intelligence Authority (FIA).
FIA is a government agency established by the Parliament of Uganda under The Anti-Money Laundering Act, 2013, to monitor, investigate, and prevent money laundering in the country.
Bagyenda’s reappointment, which was apparently made in May this year, came as a shock to many, including MPs on the Parliamentary Appointments Committee, who are supposed to be approving her reappointment- prompting Kasaija to backtrack in his footsteps.
Asked by Daily Monitor, why he had reappointed a Bagyenda, who among other institutions, is being investigated by FIA over money laundering, Kasaija feigned ignorance, saying: “When I re-appointed her, the issues of money laundering and others were not yet in the press. There is no way I could have re-appointed her with question marks surrounding her integrity,” Mr Kasaija said.
But when it was put to him that by May 7, when the reappointment letter was authored, it was public knowledge that Ms Bagyenda was under probe, Mr. Kasaija evasively asked for another day to crosscheck his facts.
Nothing has been heard from him ever since and it is now not clear whether Bagyenda’s reappointment has been rescinded or not.
Why reappointing Bagyenda now is wrong
While under the laws of the land, Bagyenda is innocent until proved guilty, with as many as four government agencies investigating Bagyenda directly and or indirectly, her rushed reappointment is both suspect and morally wrong in all ways and sends the wrong signals.
According to leaked reports, Bagyenda, between 2007 and 2016 either single-handedly, jointly with her children or using her children as possible proxies acquired and or registered 14 properties- in prime locations in Kampala, Mbarara and Ntungamo Municipalities. More records who that Bagyenda during this time held and subsequently made transactions totaling over Shs2.4 billion in cash and electronically. While there is nothing particularly wrong in making these transaction’s, these dealings, were never reported as required by Section 6 (2) b of The Anti-Money Laundering Act (2013).
The act mandates all financial institutions, law firms’ real estate agents, casinos, brokerage firms, investment bankers, registrar of companies, registrars of land, Uganda Investment Authority, NGOs and all Licensing Authorities to report to the Uganda Financial Intelligence Authority (FIA), all transactions equal to, or above the amount of 5,000 currency points (Shs100,000,000).
Under normal circumstances, this would have been enough to cause Bagyenda to either step down and or forced from the board, but not only did she stay put, she was rewarded with a reappointment!
It took a lot of pressure mounted by several whistle blowers and the media to have both the IGG and FIA to formally admit that Bagyenda had been places under formal investigation. Reappointing Bagyenda, before all these claims are substantially investigated and brought to a logical closure, is a mockery of the efforts made by these anti-corruption crusaders.
The fight against corruption should be non-selective
Away from the investigations by the IGG and FIA, BoU Governor Mutebile, in an August 1, 2017 interview with Daily Monitor also pointed a finger at Bagyenda, saying she had a role to play in the failure of Crane Bank.
“Yes, I am the head prefect of the institution but I am not criminally culpable…I am responsible for what went wrong but I am not criminally culpable…. Ask the executive director for Supervision [Ms. Justine Bagyenda],” he told Daily Monitor’s Ivan Okuda.
Additionally, a draft audit report of the Auditor General into BoU’s conduct in the takeover and sale of 7 banks, has pointed out several anomalies, all of which, place significant responsibility on Bagyenda and her office. For example the Auditor General found out that loans worth Shs135 billion from the three banks were sold to M/S Nile River Acquisition Company in 2007 at $5.25m (Shs8.9bn), a price that was a mere 26% of the total secured loan portfolio and 7% of the total loan portfoli0- leading to a loss of Shs126billion.
The full report, that is also expected to cover the closure of Crane Bank, among others, is yet to come out.
Bagyenda’s reappointment by Kasaija, even when he knew there were investigations ongoing about her conduct and wealth, best demonstrates what crusaders against corruption have called the big-fish-small-fish syndrome– a phenomenon where only small offenders are prosecuted while the big shots are let off the hook.
This syndrome is made worse by incidences where officers of the various anti-corruption agencies, such as the IGG, Police, Judiciary etc., too have been named in corruption cases.
Many of these so-called high-profile and or high-value corruption cases form the bulk of the over 4,620 unresolved complaints that the IGG’s office is besieged with. With such a huge complaint backlog, whistle blowers have been discouraged from reporting corruption.
As a result, corruption remains one of the biggest challenges of our time and is possibly becoming a way of life.
Need we then wonder why poverty levels, despite a 136.3% increase in budgetary resources, from UGX11.6 trillion in 2012/13 to UGX26.4 trillion in 2016/17, the number of poor people in Uganda has instead increased by 51% from 6.7 million in 2012/13 to 10.1 million people in 2016/17?
But again, Bagyenda could be innocent, which is why Kasaija ought to wait for full investigations before reappointing her to the FIA board, which ironically requires the highest levels of integrity.
Mr. Kyamutetera is an experienced business journalist and senior PR practitioner in Kampala, Uganda