Museveni grills BoU officials Over Crane Bank, Sudhir leaves meeting a happy man

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By Newz Post reporter
In the aftermath of Crane Bank closure and later the Forex Bureau’s, city mogul Sudhir Ruparelia (SR) seemed to have lost it all. Many had written him off. Some of his friends supposedly started distancing themselves from him.
Recently, president Museveni reportedly held a meeting over Crane Bank – BoU saga at State House.



The meeting was among others attended by Bank of Uganda Governor, Emmanuel Tumusiime Mutebile, his Deputy Louis Kasekende, Attorney General, a team from the Ministry of Finance, SR and his wife. And lawyers from both sides.
The president had three tough questions for BoU officials. According to the parties that attended the meetings, the president put to task the BoU officials to explain the circumstances under which Crane Bank was closed.
The first question was directed to Mr. Kasekende [since his boss, the Governor was ‘‘away’’ when the meeting officially started] the president asked Mr. Kasekende: ‘‘Did Sudhir steal money from his bank [Crane Bank]?’’
This was a tough and two sided question.



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Mr. Kasekende had to think fast his response. Answering yes, would attract another question [Where was BoU as this happened?] Aware of this, Mr. Kasekende said No Sir.
The second question came: Then, why did you close his Bank? Mr. Kasekende kept quiet for a while, before narrating the circumstance under which the bank was closed.
The president according to sources, asked Mr. Kasekende whether they bothered to understand the contribution of SR to Uganda’s economy among others employing hundreds of Ugandans.
Specially, the president asked the BoU officials whether they can quantity SR’s investment and contribution to Uganda’s economy.



At this moment, the president asked the BoU to go back and harmonize their position and report back.
Enter Sudhir
SR who was accompanied by his wife reportedly told the president that he did not trust the Attorney General in this case, since he[ the Attorney General] is a business partner with some of the lawyers in the BoU-Crane Bank case.
SR reportedly told the president that the Attorney General co-owns a leading mall in Kampala with one of the lawyers involved in the case against him.



When the president asked the Attorney General whether SR’s claims where true, the Attorney General reportedly answered; ‘‘It is true, Sir’’
The city mogul also told the president that BoU was wasting up to Ugx. 13 billion tax payer’s money on lawyers on the case.
Social media was awash with stories claiming that BoU has already paid half of this money [Ugx. 13 billion] to the lawyers representing them in the case.



The BoU has in the past denied spending such huge amounts on the case. However, they have not stated the amount they have paid the lawyers representing them in the case.
The property mogul reportedly wondered why the institution which has a whole legal affairs department, hires the best talents, would hire private lawyers and waste to 13 billion in tax payers money.
According to knowledgeable sources that attended the meeting, the president was seemingly shocked to learn that BoU was wasting such huge amounts on private lawyers.

BoU courting SR

Sources close to SR say, Bank of Uganda is reportedly persuading Sudhir to talk. To which Sudhir says, he can’t talk since the matter (s) are in court. SR is not interested in talks since he knows he is better position Vs BoU.
Court to decide on ‘conflict of interest’



Meanwhile court will early this month decide on alleged ‘conflict of interest’’ of lawyers representing BoU.
SR claims the Lawyers contracted by Bank of Uganda to prosecute the case it brought against him regarding the defunct Crane Bank have a conflict of interest in the matter.

Mr Ruparelia, in an application supported by an affidavit claims that individual lawyers of MMAKS Advocates and AF Mpanga Advocates have acted as his lawyers in the past and that their representing Crane Bank in the case brought by BoU against him amounts to a conflict of interest.



The lawyers are: David Mpanga of AF Mpanga Advocates and Kanyerezi Masembe of MMAKS Associates.

SR says he intends to call on the said lawyers as witnesses during his defence, and therefore that they are not qualified to represent Crane Bank (in receivership), which is suing him.

But in a jointly drawn statement, said Advocates deny that Sudhir is currently their client or has ever been. The lawyers argue that Crane Bank, now in receivership, and Mr Ruparelia are two separate entities and representing the former cannot imply that they represented the latter even when he was a shareholder in Crane Bank.



The puzzle

If Court decides in Sudhir’s favor [that lawyers indeed have conflict of interest] then the Lawyers may have to cough all the money, BoU could have paid them so far.
And if the claims that they received half of the Ugx. 13 billion are true, then they will have to return the money.
Either way, if Court decides otherwise, Sudhir has set another puzzle.
Sudhir reportedly wants Bank of Uganda officials, especially: Governor Bank of Uganda, Emmanuel Tumusiime Mutebile, Deputy Governor Kasekende and the Director Supervisor Justine Bagyenda to appear in court as his witness.
SR claims only three months before Bank of Uganda closed his bank, the bank had given his bank, a clean bill of health.



In fact reports indicate, SR has an audio of the Governor Bank of Uganda saying Crane Bank was in ‘Good Health’
SR is now asking himself, what happened in a space of three months for Crane Bank to change from good/ excellent to worse and finally closing it.
Sudhir is said to have more evidence to pin [ BoU which we will discuss in another article]. And BoU is much aware this evidence. According to analysts, BoU has two options, forget about pride, accept internal weakness/ inefficiency and then take on SR , or push for talks outside court, but, is Sudhir willing to talk? Your guess is as good as ours.



Internal weakness

Bank of Uganda now finds itself between rock and hard place. While the Bank may have evidence that bank had governance issues, maybe fraud incidences, it has a difficult task to explain where its staff and controls as all this happened.

The case

On October 25, 2016 Bank of Uganda took over the management of Crane Bank and suspended its board, saying the then biggest indigenous bank was grossly undercapitalized and posed a systemic risk to the country’s banking sector.
On July 13, 2017, BoU announced that it had sanctioned the filing of a suit against Sudhir Ruparelia and his Meera Investments to recoup money that was “fraudulently extracted from, as well as losses that were caused to Crane Bank”.

READ:Bank of Uganda staff joins ‘billionaire Club’

The suit seeks to recover a total of $93.8m (about Ugx. 337b) and another Ugx. 60.3b from Mr Ruparelia, together with the freehold titles of Crane Bank’s branches, general damages, interest and costs”.



The BoU accuses Mr Ruparelia of fraudulently taking out $92.8m (about Ugx. 334b) and another Ugx. 8.2b of depositors’ money from Crane Bank for personal gain. BoU also accuses SR of failing or refusing to remit more than Ugx. 52b in workers’ contributions to the National Social Security Fund.

Pay rise for Sudhir’s lawyers




Analysts say whoever is advising SR needs a pay rise. The man seems to be ahead of Bank of Uganda and ready to sue BoU every day. His lawyers are said to be ahead of the game.

READ: The rise and fall of Crane Bank: here is what went wrong

READ: How Crane Bank takeover was planned and executed

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1 COMMENT

  1. The truth should set our financial sector free,
    Sudhir is no saint and Museveni should not usurp the court process with his illegal meetings

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