The recent scale of fraud in Office of the Prime Minister (OPM) could have been mitigated if the Central Bank had followed the elaborate security control system governing Electronic Funds Transfers (EFT), MPs on the public accounts committee heard Thursday.
In a meeting with Milton Opio, the bank's director of banking, MPs were told that big amounts of money were fraudulently cleared to be transferred from the holding account to other project accounts. This was, however, done with the approval of only the principal accountant, Geoffrey Kazinda.
This was contrary to an agreement between the Central Bank and the donors that funds are only moved from the holding account to the Consolidated Fund and then to project accounts with the permission of the Accountant General.
One of the transfers involved sh38b of which, sh13.4b had not been approved by the OPM permanent secretary, Pius Bigirimana. A total of sh19.8b of this money was allegedly disguised as salaries for civil servants.
Opio, who was recently sent on forced leave over his alleged involvement in the scam, however, denied being lax in enforcing security control, saying the finance ministry should have had the capacity to detect any fraud in the EFT files.
A nervous Opio denied having knowingly sanctioned the payment of the EFT files, saying the system of confirmation gives the Central Bank officials the leeway to either contact the Permanent Secretary or the Principal Accountant before the payment is made.
"In our manual, we can confirm with any of the two, but we tend to deal with Principal Accountants because permanent secretaries are very busy people," Opio said, justifying his decision to deal with Kazinda, instead of Bigirimana whose signature on different supporting documents is suspected to have been forged.
Opio promised to get the committee a printout of telephone calls he made to Kazinda to confirm authenticity of OPM payments. The MPs heard that 75% of the payments were sanctioned after Opio called Kazinda for purposes of confirmation.