Credible sources have revealed that the Managing Director (MD) and Executive Director (ED) of Tropical Bank, along with several top managers, are facing imminent arrest and interrogation. The allegations against them include mismanagement of client funds, non-compliance with regulatory requirements, numerous cases of fraudulent sale of client properties, and illegal staff terminations.
It’s noteworthy that the bank has failed Bank of Uganda (BOU) audits for three consecutive years without the Board of Directors taking any action against its top leadership, despite recommendations from BOU.
Currently, the Acting ED, Joweria Mukalazi, has maintained her position for nearly three years due to court orders/injunctions that blocked BOU’s directive to remove her from the role based on alleged incompetence.
Whistleblower reports cite widespread favoritism, where some staff who commit serious frauds are protected by the ED and MD, while others are terminated for minor infractions. Several agencies have been investigating the bank for some time, and it’s now clear that the Internal Security Organization (ISO) has received instructions to arrest the MD and the ED.
This information was confirmed by credible sources who attended a meeting involving officials from the Office of the Inspector General of Government (IGG), the Auditor General, BOU, ISO, and the State House Anti-Corruption Unit.
The bank is plagued by a complacent Board that has failed in its oversight role, allowing the MD and ED to repeatedly breach internal policies and the law for personal gain or to intimidate those perceived as disloyal.
Tropical Bank has one of the worst staff attrition rates in the industry. Notably, some staff salaries were reduced by 50% under the pretext of the COVID-19 pandemic, but these reductions have not been reversed despite improved profitability. These employees, many of whom already had loans consuming 50% of their salaries, now have little to no take-home pay and rely on support from colleagues.
Staff recruitments are conducted in violation of HR policies. In one instance, a new Head of Commercial Banking was recruited while the incumbent, Ms. Aisha Mumenya, still had a valid contract with the bank. She was allegedly forced to resign.
Contrary to the Employment Act, several staff have been on probation for extended periods, while others have served in acting capacities for years.
Numerous cases of fraudulent sale of client properties, concealment of fraudulent transactions by non-compliant clients, and extortion of money from service providers have been reported. The bank has allegedly been transformed into a haven for fraudsters by its leaders, with these acts reportedly shielded by ED Joweria Mukalazi, who is even implicated in sponsoring some of these activities.
Over the years, the bank’s leadership has prioritized legal battles with stakeholders, including BOU, former employees, and clients, over improving customer service, staff engagement, business growth, and expanding its outreach.
It’s important to note that the bank recently underwent recapitalization, with the Government of Uganda increasing its shareholding.
It’s now widely believed that ISO will soon raid the bank to arrest the MD, ED, and other top managers, including the Company Secretary, the Head of Risk, the Head of Human Resources, and others.
