Kampala — Police are investigating allegations that city tycoon Micheal Ezra Mulyoowa issued false cheques worth Shs2 billion to two city businessmen.

The Special Investigations Unit and the Criminal Investigations Directorate are jointly investigating two cases which were reported to police last year by Mr Frank Katusiime, an IT consultant, and Dr Charles Mushabe. According to police sources, Ezra allegedly convinced Mr Katusiime and Dr Mushabe to set up a hospital in the city centre.

Ezra allegedly told the two to give him some money to kick-start the project. In January, 2009, Dr Mushabe allegedly gave Ezra $550,000 while Mr Katusiime allegedly deposited Shs800 million on Ezra's bank account.

Ezra in turn gave them post dated cheques to guarantee that the business was legitimate and that if the project did not start, they would cash the cheques and get their money back. However, the hospital was never built, prompting Mr Katusiime and Dr Mushabe to attempt to cash the cheques.

Sources, who preferred anonymity because they are not allowed to talk to the press, said Ezra is wanted to explain some of the allegations levelled against him. "Ezra gave them post-dated cheques that were to mature on July 17, 2009 but both cheques bounced," a senior police detective said. "CID needs to record his statement and we are looking for him." Efforts by Mr Katusiime to get his money from Ezra were futile which prompted him to seek police intervention. Police spokesperson Judith Nabakooba confirmed yesterday they are investigating Ezra in connection with Mr Katusiime's case but declined to give details.

Ezra, who displayed $3 million (Shs7 billion) to journalists last week, also allegedly owes Uganda Revenue Authority Shs1.1b in unpaid taxes. He also reportedly owes National Bank of Commerce Shs400m. He is said to have left the country despite a URA request to the Ministry of Internal Affairs to block him until he pays the taxes.