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Shock as Law firms demand Bank of Uganda Shs25 billion

New report from committee of parliament investigating the closure of three banks by bank of Uganda indicate that private law firms are demanding BoU more than Shs25 billion as indicated by the invoices presented by the law firms.

The law firms demanding BoU that huge amount of money include; Masembe, Makubuya, Adriko, Karugaba 7 Ssekataa (MMAKSS Advocates), Bowman’s Uganda, Cohen and Collins Solicitors and Notaries and Sebalu & Lule Advocates.

Some of the expenses BoU incurred as a result of hiring private lawyers despite having a legal directorate are; opposing conflict of interest case –Shs250 million, Perusing annexures-Shs32.7 million, Perusing summons- Shs575,000 and Drawing reply to written statement Shs4.6 million, among others.

The committee wants BoU to present minutes of the board meetings detailing the expenditures on external law firms contracted as BoU liquidated Teefe Bank (1993), International Credit Bank Limited (1998), Greenland Bank (1999), Cooperative Bank (1999), National Bank of Commerce (2012), Global Trust Bank (2014) and sale of Crane Bank to dfcu in 2017.

The cost for the outside lawyers began increasing in November 2016 as BoU hired MMAKS Advocates at US$251,045 (Shs943.3 million) as transaction adviser in the controversial Crane Bank takeover.

The law firm would again ask BoU US $847,175 (about Shs3.2 billion) for allegedly recovering about 14.3 million (about 54.5 billion) from Crane Bank shareholders.
BoU is said to have paid the money on May 12, 2017 though documents say MMAKS didn’t recover the money from Crane Bank.

BoU also spent Shs409.3 million as legal fees in regard to Global Trust Bank as well as paying Cohen and Collins Solicitors and Notaries Shs17.4 million for unspecific work.
In September 2017, stayed investigations into payment to private lawyers for legal services to the central bank in order not to interfere with the Auditor General’s forensic audit into closed banks, which was taking place at that time.

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