Bank of Africa Uganda Responds to Whistleblower Allegations
Bank of Africa Uganda (BOA) is currently conducting an investigation to determine the source and motivations behind several letters circulating on social media, which raise concerns about the bank’s deposit management practices. These letters, posted on various social media platforms, contain allegations of unprofessional and illegal activities involving both fraudsters and top management within the bank.
BOA’s management has categorically denied the validity of these reports, but they have nonetheless caused anxiety among the bank’s customers who seek reassurance regarding the safety of their deposits.
What has added to the public’s unease is the silence of the Bank of Uganda (BOU), the regulatory authority for the banking industry, which has not responded to several requests for an explanation regarding the matter.
The letters in question are dated between September 29 and October 5. They are presented in print format and, although they bear the names and signatures of the alleged whistleblowers, they lack contact information.
For instance, on September 29, one individual named Moses Mukasa, located at Printers Arcade, Nasser Road in Kampala, directed his concerns to the “Governor, Bank of Uganda.” In his letter, he claimed to have stumbled upon a draft document intended for false payments by BOA. Additionally, he alleged that fake court garnish orders were being processed at the same premises.
A garnishee order is a legal method used to enforce a court judgment, permitting the recovery of money from the judgment debtor. When questioned, the operators at Printers Arcade acknowledged receiving various orders for document printing, some of which appeared to be forgeries. However, they neither confirmed nor denied printing garnishee orders for BOA.
Another letter, authored by someone named Abubakar Kiberu, directed criticism towards top management, including Managing Director Arthur Isiko, attributing high staff turnover to issues like inadequate compensation. The letter also implied that underpayment of employees was leading to theft from customer accounts. The writer, described as a senior manager, mentioned instances of collusion with officials to secure cutbacks on customer loans.
The letter further alleged lending to staff beyond established limits and internal schemes to embezzle money from the bank. According to the writer, a recent scheme involved the legal team and certain senior staff members collaborating with tellers to pilfer funds from dormant customer accounts using forged court garnishee orders.
Kiberu claimed that over 700 million shillings had been systematically siphoned. Although an internal audit was said to be underway regarding the theft of 500 million shillings using forged garnish orders, Kiberu expressed doubts about the outcome, citing the involvement of well-paid internal auditors.
The whistleblower called for an independent external audit to examine these forged garnish orders but suggested that it should occur after Managing Director Arthur Isiko is placed on leave or removed from the station to encourage staff to come forward with information on fraudulent activities where the MD may be personally implicated.
Similar concerns about lending practices and alleged irregularities were reiterated in another letter addressed to the Deputy Governor of the Bank of Uganda. This letter, dated October 1 and written by Kasoma David, alleged that BOA had consistently violated policies limiting employee loans to three times their annual gross pay over the past decade. The whistleblower claimed this jeopardized the bank’s liquidity and potentially violated minimum capital requirements.
The writer also alleged that the MD had placed the Executive Director on leave to avoid accusations during the October audit.
On October 5, yet another letter, attributed to Kinene David, called for the intervention of President Yoweri Museveni in the issues surrounding BOA to prevent a recurrence of problems seen with Greenland Bank and Crane Bank, both of which were closed by the Bank of Uganda due to management issues, including violations of insider lending policies.
The letter to the president also alleged that some bank staff provided money to outsiders for trading in financial products like foreign exchange, with commissions promised at the end of the day. Additionally, it claimed that staff were siphoning funds from dormant accounts using forged court orders.
The bank has firmly denied all these allegations while assuring the public that investigations are ongoing. The bank emphasized that all customer deposits remain secure and that the bank’s operational standards have not deviated.
Bank of Africa Uganda is a subsidiary of the Bank of Africa Group, which operates 18 commercial banks across different countries. In a statement, the bank indicated that it is taking legal steps to address the dissemination of false information and pledged to keep the public updated on its progress.
