Cosase: Bagyenda leaked Global Trust Bank secrets to dfcu, made unilateral decision to sell
Justine Bagyenda leaked confidential information about Global Trust Bank to dfcu hours before she made the unilateral decision to sell the bank. She also sold Crane Bank to dfcu. Coincidence?
PROBE | The closure of Global Trust Bank has been linked to alleged dubious dealings of Justine Bagyenda, who is understood to have leaked information to a rival bank.
The former Executive Director in charge of Supervision at Bank of Uganda is also understood to have made a unilateral decision to sell assets and liabilities of the Nigerian chain of bank to dfcu.
Bagyenda’s hand in the closure and sale of Global Trust Bank was to the attention of the parliamentary Committee on Commissions, Statutory Authorities and State Enterprises (Cosase) this week, with Abdu Katuntu on Thursday querying how she had sold the bank in 2014 without consulting Governor Tumusime Mutebile.
According to information availed to Cosase, Bagyenda first shared confidential information regarding Global Trust Bank with the dfcu, a direct competitor in the banking sector, before eventually selling it to them two hours after the embattled bank was closed.
In a rather mind-boggling revelation, Cosase, which is investigating the closure of seven commercial banks over the last 25 years, heard that, on July 10, 2014, Bagyenda and then dfcu managing director Juma Kisaame signed a confidential agreement where she reportedly disclosed the financial standing of Global Trust Bank, contrary to Bank of Uganda Act that stipulates secrecy and confidentiality of information regarding other banks.
It is the kind of revelation that leaves many with aghast and it certainly wasn’t any different before Cosase as Medard Ssegona (Busiro East) gathered his wits to demand explanations on this alleged conduct by an official in position of Bagyenda.
“Did you have consent from Global Trust Bank whose information you were disclosing? And why did you disclose affairs of a financial institution with another bank in contravention with Bank of Uganda Act to unauthorised people?” Sseggona asked.
Naturally, Bagyenda wouldn’t have a ready answer to such revelations. She stared back without any response. But answer or not, she would have more queries pouring on her laps.
“Is it true that you’re the only officer who signed this document?” Katuntu asked in reference to deeds related to the sale of Global Trust Bank.
Bagyenda had stared back in the first instance but she wasn’t going to keep acting the same unless she wanted to rile the legislators. This time, she admitted the lone signatory.
The embattled economist also admitted to not consulting and appraising her boss Mutebile on the decision to sell off assets and liabilities of Global Trust Bank, claiming however that central bank legal counsel was aware.
“The legal counsel was aware and I believed at the time that the governor had been briefed by the legal team,” Bagyenda she.
According to the Bank of Uganda Act, it is only the Governor or Deputy Governor witnessed by the Secretary to the Board who can authorize closure and sale of a Bank.
“Imagine tomorrow a driver selling a document on behalf of the Bank. Have we reached that level? If your officers are going to commit the Bank, then there is a problem,” Katuntu said.
“My signing on this document was based on the practice that all legal documents go through Governor’s office and the board. I have never taken a single decision to close a bank that is never drawn by legal counsel. I assumed that they did all the necessary consultations,” she added.
“Did you know the governor cannot you perform a constitutional duty without powers of the constitution? A constitutional office can never be delegated. Nobody can preside over functions unless the constitution allows, so this business of Bagyenda committing the bank isn’t only irregular but illegal, it makes it worse that she is disclosing confidential information to a competitor, who she eventually sells the bank to.”