Africa-Press – Uganda. The Bank of Uganda is under intense scrutiny following revelations of a nearly 60-billion-shilling fraud that diverted funds intended for international debt servicing.
The fraudulent transactions, executed on September 12 and 28, 2024, have raised serious concerns about the institution’s oversight of global financial transactions.
During the December Monetary Policy briefing, Deputy Governor Michael Atingi-Ego reassured the public about the central bank’s systems and recovery efforts. “Let me assure Ugandans: our internal systems remain secure and uncompromised. This was not a hacking of our systems but a breach of trust within the global correspondent banking network,” Atingi-Ego stated emphatically.
The Fraudulent Transactions
The first transaction involved $6.134 million meant for the World Bank, fraudulently sent to Roadway Company Limited in Japan. The second, totaling $8.596 million intended for the African Development Fund, was redirected to MJS International in London.
Recovery Progress and Setbacks
The Bank of Uganda, in collaboration with CitiBank and other local and international partners, has recovered $8.205 million from MJS International, which has been credited back to Uganda’s consolidated fund.
However, recovery efforts in Japan face significant resistance, with the recipient bank, MUFG, proving uncooperative.
Efforts to recover the remaining $391,000 from the London-based account are ongoing, while funds sent to Japan remain unrecovered, raising concerns about the overall recovery process.
No Staff Under Scrutiny or Arrest
The Deputy Governor denied allegations of staff involvement, emphasising the fraud did not stem from internal operations. “No member of our staff is under scrutiny or has been arrested.
However, everyone involved in handling these transactions is fully cooperating with investigators to ensure the stolen funds are recovered,” Atingi-Ego clarified.
Inflation Stability Amid Crisis
Despite the fraud scandal, Uganda’s inflation rate remains stable due to diminishing global inflationary pressures, lower food prices, and the central bank’s proactive monetary policies. Atingi-Ego assured that core inflation is expected to remain below the 5% target, with the mining and oil sectors supporting the stability of the shilling.
Debt Sustainability
Atingi-Ego also addressed Uganda’s debt position, asserting that it remains sustainable and manageable. “Uganda can and will meet its repayment obligations in the coming years without jeopardising its financial future,” he affirmed.
While the Bank of Uganda insists its systems are intact, the fraud highlights vulnerabilities in the global banking framework. Investigations by the Auditor General and international partners continue, but public trust remains fragile.
The Deputy Governor reiterated the central bank’s commitment to transparency and accountability as recovery efforts proceed.
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