HOT SEAT: BoU Deputy Governor, Dr. Louis Kasekende.

Days ago the Speaker of Parliament, Rebecca Kadaga received two petitions to stop parliament’s committee on Commissions, Statutory Authorities and State Enterprises (COSASE) chairman Mubarak Munyagwa from opening a fresh inquiry into the Bank of Uganda (BoU) over the closure seven commercial banks, including Crane Bank Limited (CBL).

It is believed BoU Deputy Governor Dr Louis Kasekende is behind the new probe aimed at clearing the names BoU officials involved in the misuse of Shs478 billion they claim they injected in CBL under receivership. MP Munyagwa recently appointed his counterpart Ibrahim Kasozi to head a select sub-committee on the closed banks without the clearance of Kadaga who has a final say on whether COSASE should re-open investigations into irregularities at BoU or not in regard to closed banks.

Kasekende has been trying to have a second audit of BoU especially as regards the accountability of Shs478 billion, of which the first COSASE headed by MP Abdu Katuntu faulted BoU officials as Shs320 billion went missing from records.

MPs who first probed BoU officials from October last year to February this year were angered by the fact that the officials could not present all documents related to how that money was used. Parliament is supposed to act on recommendations that the committee under Katuntu presented after the Auditor General John Muwanga established the missing money. Yet Kasekende has tried to force Muwanga to do a fresh audit of Shs478 billion, something which Muwanga has refused, saying only parliament can order him to carry out a fresh audit. BoU officials in the first probe failed to present to Muwanga all the documents required for auditing.

MP Munyagwa has come under public criticism for pushing a fresh probe instead of pushing for the implementation of the existing Cosase report on irregularities in the closure of 7 commercial banks. The Cosase report was presented by Munyagwa’s predecessor, Abdu Katuntu who said BoU cannot ask CBL shareholders to repay Shs478 billion as if they participated in its transfer and use.

MP Katuntu’s report was adopted by the House with recommendations on the culprits at BoU and proposed measures to clean the mess at BoU. Some irritated MPs say they will block a fresh probe of BoU especially as regards Shs478 billion. They have labelled Kasozi’s sub-committee as a pipeline laid illegally to clear BoU officials implicated in the irregular transfer and use of the Shs478 billion. BoU officials claim injected in CBL as liquidity support, having closed it for undercapitalisation yet they failed to account for the money. CBL needed only Shs150 billion to remain operating.

“Kasekende wanted the new documents to be used by the Auditor General to clear outstanding accountability queries on the expenditure of Shs478 billion injected in CBL before it was sold to DFCU Bank at Shs200 billion. The Kasozi subcommittee could be used to do that irregularity,” an analyst says.

Another analyst said Kasekende could have worked behind the scenes to influence Munyagwa who did not seek permission from the Speaker before reopening investigations. Now the Speaker is expected to use the rules of procedure to address petitions in which concerned citizens are not supporting a new probe into BoU but want parliament to act on recommendation presented from the first COSASE probe.

Two separate petitions were days ago delivered to Kadaga pleading with her to block Munyagwa’s Cosase from conducting fresh investigations into BoU’s sale of seven commercial banks.

The petitioners, Michael Businge a resident of Nsambya, Kampala and Sam Kakuru a student of Uganda Christian University contest that it would be a waste of taxpayers’ money on a ‘syndicated move’ to clear BoU officials of wrongdoing.

The Speaker who supervises all the committees of parliament is expected to look at the merits in the petitions and the rules that guide Parliament to take a decision.

Three months ago Cosase concluded its probe into the accountability Shs478 billion as presented by the Auditor General and citizens and MPs see no need for Munyagwa to redo the exercise.

Last week, Cosase met BoU officials led by Kasekende to respond to outstanding Auditor General’s queries but also demanded for accountability for the Shs478b which BoU claim was injected in CBL.

The petitioners argue that the House Rules of Procedures do not give Cosase powers to re-examine its reports and accused MPs of creating a backlog.

“These exercises cost taxpayer’s money and must be performed lawfully. [We cannot keep repeating the same things uncles there is something MPs are not telling Ugandans… This is to request you to prevail on the said Committee not to spend state resources (money and time) on a re-examination which is outside its mandate” Businge says in his petition to Kadaga.

On the other hand, Mr Kakuru, another petitioner, argues that the direction being taken by the Committee amounts to “contempt of parliament” hence asking the Speaker to relieve Mr Munyagwa of his duties as Committee Chairperson.

He argues that the select sub-committee headed by MP Kasozi with instructions to hear the BoU officials in closed meetings which is questionable.

“The Sub-Committee headed by Hon Ibrahim Kasozi is ultra vires on grounds that it conducts its proceedings behind closed doors. The issues of banking sector (Central Bank) are of public/tax payer concern,” he says.