CID takes hold of Shs 800bn worth of Oloka, Obey properties, over 256 land titles attached
Early one morning last month, one Kenneth Tulomwe was arrested by police as he drove out of his gate in Muyenga in a brand new double cabin pick-up truck he had just bought. Kenneth works as a driver to David Oloka, the former Assistant Senior Accountant in the Ministry of Public Service.
Oloka had been interdicted earlier together with Stephen Lwanga, an office clerk, Christopher Obey, who was Principle Accountant, and the Permanent Secretary, Jimmy Lwamafa for allegedly stealing billions of shillings using ghost pensioners.
When hours turned into days without seeing Tulomwe or getting any information about his whereabouts, his family and most especially Oloka and Obey went into panic mode.
According to sources, police had got a tip from informants that to understand the pension scam; they needed to get hold of Tulomwe. He was not a mere driver but also a courier who carried cash from Cairo Bank to several people inside government whom Oloka and Obey would pay because they were either political godfathers or allies in hiding the theft. According to information, these included officials in the ministries of Finance, Public Service and the offices of the Accountant General and Auditor General.
A blindfolded Tulomwe was driven around Kampala for about four hours and finally taken to an isolated police cell. The police were under strict instructions not to inflict any physical harm on him. However, they were instructed to exhaust him psychologically. This, it was hoped, would make him feel vulnerable and induce him to reveal all the assets Oloka, Obey, Stephen Lwanga and Peter Ssajjabbi had accumulated.
The four are the main suspects in the scam in the ministry of Public Service, in which billions of money meant for pensioners was siphoned off. The government is interested in the suspected assets because, if they are convicted, it hopes to auction them to recover at least some of the money.
It should be noted that although the four are generally thought to have stolen the money, in reality, they are innocent until proven guilty in a court of law.
Tulomwe was also expected to reveal others in ministry of Finance and Auditor General's office who colluded in this massive swindle of public funds.
He was also expected to reveal people in police, parliament and the office of the Director of Public Prosecutions (DPP) who had been bought off by Obey and Oloka in order to undermine the investigation.
Immediately he was placed in the isolated cell, Tulomwe began talking. He revealed his own properties, some companies and properties Oloka and Obey owned, gave a few names of collaborators inside the office of the Accountant General and the Auditor General.
Scratching the surface
But police knew he was only scratching the surface. They had much more information about the properties the trio owned having obtained it from the Uganda Revenue Authority and the Lands Registry. Clearly, the police realised that the "rose garden" method (no torture) of extracting information was not working on a hardened Tulomwe. And the instructions were that there would be no torture.
So police decided to play a trick on Oloka, Obey and Ssajjabbi. Two days later, they waylaid Oloka as he left his home and took him by surprise and arrested him. They drove him to police under heightened security. They told him that Tulomwe was under their custody and had revealed everything - their allies, accomplices, properties and bank accounts.
Oloka believed there was nothing more to hide except those assets and transactions Tulomwe would not have known about. He began talking too revealing a list of all his properties.
When they took him to his house, police retrieved 38 property titles from a closet. However, Oloka said he had more titles. His son had hidden them. He asked them to bring them - and there they were titles of an extra 67 properties bringing the total to 105.
Asked how much he valued his net worth, Oloka said he estimated that he had about Shs 300 billion (Approx. US$120 million). Police are still trying to establish a more accurate figure, which they say could be much higher.
Meanwhile, Obey thought Oloka and Tulomwe had been kidnapped by some mafia, and rushed to CID headquarters to report the kidnap. He too was arrested and detained.
Obey had boasted that no one could touch him as he had bought off the entire government machinery. Now, isolated and exhausted by nonstop police interrogations, Obey revealed 67 titles of properties he owns across the country some of them, like Conrad Plaza worth millions of dollars. Pressured further, he produced another 50 property titles all to a tune of Shs 500 billion. It was the biggest catch of official theft in Uganda's post independence history of fighting public graft.
How did it all start? How did the Uganda police, renowned for its own corruption, incompetence, indifference and foot-dragging turn the screws on people who had compromised its members and the DPP's office, bought off parliament and the press, and boasted that they could buy off any judge?
Reliable sources say that on Monday Oct. 29, the Inspector General of Police, Maj. Gen. Kale Kayihura held a meeting with the commander of the Special Forces Command (SFC), Brig. Muhozi Keinerugaba, at police headquarters along Parliamentary Avenue. Kayihura had received a disturbing report from a source.
The report said that estimates from the ministry of Finance showed that close to Shs 500 billion (US$ 200 million) could have been paid out to ghost pensioners over the last 12 years. It also said that three of the interdicted civil servants had a combined wealth of over Shs 600 billion.
Three officers inside the ministry of Public Service at the center of the scam were all low key officials whom anyone could hardly expect to swindle such large amounts of money: Christopher Obey, the Principle Accountant, was the suspected architect of this massive theft; David Oloka aka Mzee, was the alleged second in command; and Stephen Lwanga, the office clerk, was the top footman.
Collaborating with them in this theft from the private sector was Peter Ssajjabbi, the Nstional Secretary General of the East African Community Beneficiaries Association (EACOBA). (For his role, read "Pension theft figure shoots to Shs150bn, The Independent, and Oct.26).
"With this cash in their hands," Kayihura told Muhozi, "these thieves are in a position to compromise public institutions like the police who are investigating the case, state attorneys in the office of the DPP who are supposed to prosecute the case - or even worse still, the judges.
Secondly, and the reason I called you..." Kayihura did not finish the sentence as Muhozi, almost reading the IGP's mind spoke out aloud, interrupting Kayihura mid-sentence: "Afande, this is not a mere criminal act. It is also a threat to national security. What if these people used this money for subversive activities?"
"Exactly, exactly..." Kayihura said in an agitated tone, "you have just picked the words out of my mouth. That is exactly why I called you here. The criminal part is critical. But we cannot also ignore the threat paused by such behavior to national security. This is an extraordinary case and needs extraordinary measures. We have decided on a strategy to crack this case but have limited manpower. I want to brief you about the extent of the problem so that if we can call upon you for any back-up, you know what we are dealing with."
The initial investigation into the theft had shown that between February and October 2011 alone, Shs 63 billion was paid out to ghost pensioners. The report had been taken to President Yoweri Museveni who ordered the firing of the civil servants involved in the scam and ordered an immediate police investigation.
Kayihura told Muhozi that the police's Criminal Investigations Department (CID) had done a good job and compiled a case against the thieves. But the DPP's office was slow in accepting the case, always asking questions and delaying charging them in courts of law.
Apparently, Kayihura told Muhozi that he had heard that Obey boasted to friends that he was tired of bribing police officers. He was now going to focus his attention on state attorneys from the DPP's office and also on the judges. According to the IGP, the suspects were confident nothing could happen to them because they have enough money to buy almost everyone trying to investigate, prosecute and convict them. What was the way forward?
"We must acknowledge that the state can be compromised and all its institutions become complicit in this scandal," Kayihura said raising his voice, "This is what is called state capture... the state can be captured by criminals. These people can use the money they have stolen from the public to undermine the ability of public institutions to hold them accountable.
And the public out there may think that government, which is the biggest loser, tolerates their criminality. Right now they are free on police bond, busy selling their properties and transferring others into other people's names in order to hide it. They are also massively withdrawing their money from banks and closing some accounts to destroy evidence."
Muhozi listened in stunned silence as Kayihura briefed him on the state of the case and asked only one question: what do you plan to do about all this? At this point, Kayihura called into his office two officers he trusts most: the Director of CID, Grace Akullo and her deputy, Moses Musana, who is in-charge of investigations.
"These are the officers I am working with and they are honest and tough," Kayihura said, and this is our strategy, "First, we are going to arrest all the culprits involved including Oloka's driver, a one Kenneth, who has been personally carrying the money and paying off government officials. Apparently, the three were not eating alone.
We have information that they had compromised officials in the ministry of Finance, especially the auditors in the office of the Accountant General, the office of the Auditor General and other ministries and government departments. Kenneth was the man carrying the money to pay off all these people. We also hear they have many Members of Parliament are on the take..."
Kayihura went on: the police was going to re-arrest all of them because many of the things they were doing were interfering with investigations - like withdrawing money from banks, selling off properties, closing accounts, and bribing investigators.
The IGP said that given the financial muscle the thieves had, the best way to cripple their ability to undermine the investigations was to hold them in custody. The problem, Kayihura lamented, "we can only hold them for not more than 48 hours whereupon we have to take them to court. There, the courts are much more likely to grant them bail and we would be back to square one."
"So what do you need from us," Muhozi asked, "This is clearly a criminal case although I can see a national security angle to it. Naturally, we would be reluctant to get involved in such a matter because of public perceptions."
Kayihura explained that the police have to seize and take control of all the offices and homes of the suspects in order to ensure that in one sweep they can take them unawares and get as much evidence as possible. They have two companies; Gaming International and Akagera Rice, housed in Conrad Plaza. They have a money lending company, UGAFIN, housed in Twed Plaza.
It has lent out Shs 50 billion. They have another lending company, Continental Finance Services International, headquartered in Kibuli in the offices of Lamba Construction, another company owned by Obey. It has lent out over Shs 100 billion and has properties worth about Shs 200 billion. They also own Leeds Insurance located in King Fahad Plaza.
The challenge, Kayihura explained, was to occupy all these offices at once with search teams and support teams. It was also to do a second raid on their homes. Kayihura said police had already lost the most valuable time as these raids should have been done immediately these people were interdicted. But, he added, it's always better late than never. Muhozi agreed.
Kayihura said that for police to be able to be present in more than 20 locations at the same time requires extraordinary manpower in excess of 200 personnel. That would mean shifting police officers from other key duties to this one single issue. All he needed, he said, is assurances that if called upon for back-up to improve police capability, SFC would be on standby.
Muhozi agreed saying that although he supported the operation 100 percent, he still felt that even if there is a one percent chance of not involving SFC, he would prefer police to go it alone - because of public perception issues.
According to sources, Muhozi, Kayihura, Akullo and Musana were locked up in the meeting all day. The meeting only broke off for lunch at 1pm and reconvened at 2.30pm till 5pm when they departed. During this time, it was agreed to write to the Bank of Uganda governor, Emmanuel Tumusiime Mutebile to freeze all the bank accounts of the accused and those of the companies where they were principle shareholders.
It was also agreed to ask courts to place caveats on all their properties and those of the companies owned by them. Finally, it was agreed to provide security to those civilians who were helping police in providing vital information about the properties owned by the suspects and their bank accounts.
At one time, Akullo complained that CID has no money to conduct such investigations. Their quarterly release of Shs 40 million for 114 districts was a drop in the ocean. At this point, Kayihura assured the meeting that he would seek a supplementary budget from the ministry of Finance.
Keith Muhakanizi, the Deputy Permanent Secretary in the Ministry of Finance, Planning and Economic Development (his boss, Chris Kasami, was out of the country) had promised "full support" to the investigation. "Give me your budget tomorrow morning at 8am and you will have the money by noon," Muhakanizi had promised in his usual bombastic style on phone, "We have a big interest in this investigation."
To take direct charge of the investigations, Kayihura tasked the police's Chief of Special Investigations, only named as Dixon. A tough talking and energetic guy, Dixon is a police commander's dream. His telephone is on 24-7 and works day and night. He has been responsible for some of the most successful police investigations involving the tracking of criminals and terrorists across borders.
Musana was to oversee the entire operation to ensure the suspects are interrogated and as much information as possible is recovered. Kayihura promised that if government wins the criminal case in court, it will seek court orders to auction their properties to recover public money - a sweetener that made Muhakanizi see that this was not an expense but an investment.
Meanwhile, a few days earlier, President Yoweri Museveni had given a go ahead to the police to use all means at its disposal to bring the accused to book.
"Don't torture anyone," he warned, "Don't do anything extra legal. You can push the law, but don't break it."
Kayihura had taken this advice to heart and was willing to push the law to its limit. However, due to internal bureaucratic incompetence, perhaps some sabotage and even some miscommunication, it took 10 days between the day the Oloka and Obeys to be arrested and for the central bank to freeze their accounts.
It also took 12 days to place caveats on their properties. By the time all this was done, a lot of water had gone under the bridge. The accused had made some moves too.
By the 15th day, police had retrieved 256 property titles with an estimated value of Shs 800 billion. And informants were saying this was still less than the assets the accused had accumulated. Since police has not yet widened its net to capture accomplices in other ministries, the amount of wealth recoverable may be in trillions of shillings.
Thus, on Tuesday Nov. 13, exactly two weeks since the meeting between Kayihura and Muhozi, the police moved into Twed Plaza, Conrad Plaza, King Fahad Plaza, Lamba Construction offices in Kibuli, and other offices of the Obey-Oloka-Lwanga empire for searches.
The police also raided the chambers of the law firm representing the duo, Ms O.N. Osinde and Co. Advocates. However, the Uganda Law Society has condemned the police raid. While noting that the police acted within its mandate, the law body made cautious calls for "decency" and "courtesy" in such searches.
Given that the search was days late, a lot had been hidden but police were able to recover vouchers, sale and purchase agreements of properties, bank statements, receipts etc that provide some clues on where the money was going.
The CID also began driving the accused to different sites taking still and motion pictures of their properties. By the time of going to press, all the accused were out of jail on bail but for the first time, a determined effort to seemingly fight corruption was underway. Police are still trying to establish a more accurate figure, which they say could be much higher.