OPM officials refund scam cash

By Steven Candia and Simon Masaba

A number of officials from the Office of the Prime Minister (OPM) implicated in the multibillion financial scam have refunded monies they are suspected to have pilfered under the newly introduced plea bargain arrangement.

Sources in the know who New Vision spoke to said over sh230m has so far been recovered from the suspects under the arrangement. About sh50b is said to have been lost in the scam although a latest police document that Saturday Vision has seen puts the funds under investigation at more than sh122b.

The plea bargain is a new jurisprudence in the Uganda legal regime in which a suspect pleads guilty, committing him or herself to certain undertakings in the hope that the plea will mitigate on the sentence. It involves various stakeholders in the matter.
“It is true that some people have made refunds and some money has been recovered,” the Director of Public Prosecution (DPP), Mike Chibita, said when contacted. The monies were deposited on the consolidated fund account.

Bank of Uganda documents that New Vision has seen indicate that the monies were deposited by several officials or through their lawyers on account number 000080148000004 in the bank, largely by electronic funds transfer (EFT) from various city banks.

Chibita in an interview said the arrangement with regard to OPM had been put in place after wide consultations with a number of key stakeholders in the justice law and order sector (JLOS) to ostensibly cater for “small fish in the scam”.

A Police status report on the OPM probe indicates that as of October 6, six convictions had been secured on the matter, nine files were in court, 43 with the DPP, while 59 files had been returned from the DPP. The report further indicates that 165 cases were still under inquiries. It notes that sh 232, 619, 900 had been refunded.

Attempts to get a comment from Cissy Kagaba, the executive director of Anti-Corruption Coalition Uganda on the matter were futile. However, Moses Karatunga, the programme officer, Transparency International, welcomed the move, saying it augurs well for taxpayers’ money.

“If the money has been recovered, however small it may be, it sets a good precedent,” Karatunga said.

Documents available indicate that some of the suspects who have made refunds, partial or complete include Grace Nalumu (principal personnel officer); Mayanja Gonzaga (commissioner in charge peace recovery and development plan); Martin Etyang (assistant commissioner for Karamoja programmes); Patricia Agaba Ruhinda ( senior assistant secretary in the finance department) and Monica Kalemba (under secretary). Some of the officials already have suits in court.

Although the arrangement is meant for perceived ‘small fish’, some of the officials, according to documents have refunded sums well over sh100m. Among those who have refunded money are Agaba, who as of September 2014 had paid sh109m in several instalments through several EFT transactions from Housing Finance, starting April this year.

The money, according to prosecution, was purportedly spent on the workshop held at Rider Hotel in Seeta, Mukono, for the district leaders implementing the Luwero/Rwenzori programme and yet such a workshop never took place.

According to documents, Gonzaga has so far refunded sh18m; Etyang sh9m; Kalemba sh23m and Nalumu sh20m. Under the arrangement, the suspects are first required to plead guilty and make good the loss, before appearing before the judge with discretionary powers to either reduce the counts, among others.

“The court will decide, but this definitely mitigates on the part of the suspect,” Chibita says.

Grace Akullo, the director criminal investigations and intelligence directorate (CIID), which has been at the forefront of investigating the probe, says she is aware about the development. “But this does not exonerate the suspects totally. In fact it even confirms their guilt.”

At least sh50b meant for the Peace, Recovery and Development Plan is believed to have been stolen in the scam, which has forced five donor nations as well as the European Union (EU) and the World Bank to suspend a huge percent of budget support to Uganda. The donors also put stringent conditions on the Government to stop further abuses.

In November last year, the EU ambassador to Uganda announced that the EU, United Kingdom, World Bank, Austria and other countries had suspended up to $300m (about sh750b) promised in budget support each year, up to 2013.

The scam came to the fore in 2012, highlighting gross mismanagement of funds in the OPM. The allegations included among others embezzlement of funds, use of personal accounts for implementation of activities, diversion of funds and unaccounted for funds. The allegations confirmed in a value for money (VFM) audit by the Auditor General (AG) also kicked up a separate probe by parliament.

The audit report by the AG into the loss in the OPM blamed the mess on internal control weaknesses in the treasury, citing collusion by officials in the ministry, the finance ministry and Bank of Uganda. The probe found that officials in the three institutions exploited the weaknesses, which led to the loss of billions through irregular money transfers.

The weaknesses the audit identified include the use of generic passwords by officials in the finance ministry, minimal and irregular supervision by the Bank of Uganda, lack of involvement of internal audits in the Treasury and an absence of closed circuit TV cameras.

In the report, the Auditor General called for investigations to be extended to the implicated private companies, staff personal accounts, districts and banks, with a view of recovering the funds and prosecuting the staff involved.

The audit also established that over the period of two financial years between July 1, 2010 and June 30, 2012, the principal accountant in the OPM, Geoffrey Kazinda, fraudulently approved invoices amounting to over sh16.2b.

Already serving a five-year jail sentence, Kazinda faces 69 new charges in connection with theft of donor aid meant for northern Uganda and Karamoja. Kazinda is charged alongside former finance ministry officials.