Sylvia Juuko
20 December 2008
Kampala — BANK of Uganda (BoU) has asked the High Court to overturn a fraudulent ruling that facilitated the illegal transfer of titles held as security for a debt owed by businessman Basajjabalaba, senior officials have said.
Juma Walusimbi, the BoU spokesman, said the bank is holding titles to property belonging to Basajjabalaba hides and skins Ltd to facilitate the recovery of debts amounting to sh39b ($21.3m).
"In the process of recovery of Basajjabalaba's debt to BoU, it has been discovered that through a forged consent decree, replacement certificates of title in respect of the properties held as security were illegally obtained by the debtor from the Registrar of Titles and purportedly transferred to multiple names with the intention of putting these securities out of reach," Walusimbi said during a press briefing last Friday.
Walusimbi told journalists that the bank has engaged the services of M/S Masembe, Makubuya, Adriko, Karugaba & Ssekatawa Advocates to apply to the High Court to set aside this fraudulent consent decree and have the transfer of the properties cancelled.
He added that the bank wants relevant authorities to investigate and prosecute businessman Basajjabalaba and the Land Office for perpetrating this fraud.
He explained that the Government through the Central Bank intervened to settle debt, at a discount, owed to Standard Chartered Bank and Stanbic Bank.
According to Walusimbi, the payments to the commercial banks were on the understanding that the right to recover Basajjabalaba's debt of $18.3m owed to Standard Chartered Bank as at January 2004 and $3.46m owed to Stanbic Bank as at April 2003 were to be assigned to BoU.
"By a 'deed of debt and security', dated March 30, 2006 between the BoU on behalf of the Government and Standard Chartered Bank. Another deed dated June 1, 2008 was also signed between Stanbic Bank and BoU, the assignment of the above debts and securities were formalised," the Central Bank spokesperson said.
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