Information reaching us right now is Bank of Uganda (BOU) entered into agreement with MMAKS Advocates to pay Sh13b as legal fees in a case filed last week at the Commercial Court, a division of the High Court against the former proprietor of Crane Bank, tycoon Sudhir Ruperalia.
A Copy of the memorandum we have seen indicate that Sh2.1b has already been advanced to MMAKS and was in respect of initial filing fees!
An insider from BOU legal department intimated to us that the internal legal department are of the opinion that the probability of success is of this case is low but Justin Bagyenda and MMAKS have had their way. Not only do they think they will not win the case, but it will reveal internal weaknesses inside BOU.
An undisclosed source has further revealed to us that Sh13b legal fees will be shared between Ms. Justin Bagyenda, the soon to retire Executive Director in charge of supervisor at BOU and the external lawyers headed by Masembe Timothy of MMAKS Advocates.
The Masembes are the owners of village mall. Those of you who shop from there see what taxpayers can do.
They are not taking Sudhir to court to secure victory but to share a loot!
A Bank of Uganda investigation into the mismanagement of Crane Bank says its proprietor, Sudhir Ruparelia, embezzled over sh400b through what they called highly sophisticated fraudulent transactions.
Bank of Uganda (BoU), through the Crane Bank now under receivership, has sued the embattled tycoon and his Meera Investments Company, to force him to pay back the money with interest, according to court documents seen by Sunday Vision .
BOU also names a number of businessmen that it says colluded with, aided or facilitated Sudhir to carry out the alleged fraud. Others named in the court documents are companies linked to the property mogul.
The Central Bank says that Sudhir operated phony bank accounts within Crane Bank, purposely to conceal what it called fraudulent transaction and deceive the Central Bank about the financial status of Crane Bank.
According to Bank of Uganda, Sudhir perpetrated sophisticated false accounting “to cover up the hole in the plaintiff’s (Crane Bank) accounts.” Sudhir’s business associates named in the alleged fraud include Jitendra Sanghani, Rasiklal Chhotalal Kantaria, Godfrey Kirumira and Mohammed Ali.
BoU argues that $80m was siphoned from Crane Bank on October 26, 2013 and over $9.2m “extracted” from the institution on different dates in the same year, purportedly for the supply of core banking systems and software licenses.
According to the documents, over $3.5m and more than sh8.2b was taken out of the bank on December 27, 2014 disguised as credit facilities to Infinity Investments Limited and eventually written off as bad debts under Sudhir’s instructions. Infinity Investments Limited is reportedly owned by Sudhir.
A total of $990,000, according to BoU, was withdrawn from Crane Bank and paid to Meera Investments as rent fees, illegally, between 2013 and 2016, the document argues. The Central Bank says Sudhir did not remit over sh52b in workers’ savings to the National Social Security Fund between 2007 and 2016.
BoU alleges that Sudhir fraudulently transferred freehold titles of 48 plots of land (where the bank has its branches) purchased and developed using the Crane Bank’s finances into the name of Meera Investments, from Crane Bank. The plots of land, according to the court documents, were then leased back to the owner (Crane Bank) at high fees.
Each plot was reportedly leased to the bank at sh100m as premium for 49 years and a $6,000 in ground rent per year, payable to Meera Investments.
The Central Bank further states that the embattled entrepreneur is the registered owner of 28.83% of the bank’s shares. He is also reportedly the owner of 47.33% of the bank’s shares registered in the name of White Sappire Ltd, a company incorporated in Mauritius and allegedly owned by Rasiklal Chhotalal Kantaria.
BOU said Sudhir owns 4% shares registered in the name of Jitendra Sanghani and a further 19.83% recorded in the names of members of his immediate family – wife and their three children. White Sappire, it’s supposed owner, Kantaria, Sanghani and Sudhir’s family members, according to suit, have always acted as his nominees and at his direction.