CID takes over diplomat's multi-billion shilling probe

BORDER FRAUD

In the wake of auditing irregularities at the Ugandan mission in Nigeria, three officials risk criminal proceedings while the Government prepares to shut down 23 missions, Vision Reporters write.

The Criminal Investigations Directorate (CID) has taken over investigations into a case where Uganda’s envoys in Nigeria, including High Commissioner Nelson Ocheger, have been accused of embezzling billions of shillings. 

This was after Auditor General Edward Akol handed over a report on selected foreign exchange transactions and utilisation of the supplementary funds to Parliament. 

As a result, Parliament forwarded the report, which revealed gross financial irregularities, to the CID for further investigations, with a view to prosecuting anyone found culpable. 

Deputy Speaker of Parliament Thomas Tayebwa said he had weighed all options and found that it was critical to ask the Police directorate to look at the issues established by the Auditor General and determine whether they are acts of fraud and take action. 

“We are not asking CID to go and implement. We are asking them to look through and if they find that what the Auditor General discovered borders on criminality, they should go ahead and take action,” Tayebwa said. 

In the report, Akol mentions the head of the Ugandan High Commission in Nigeria, Ocheger, financial attaché Nicolas Kanamwangi and accounting officers Alfred Nnam and Judith Asiimwe, as persons responsible for a number of irregularities that took place at the mission between July 2022 and March 2024. 

The report was tabled before Parliament by Bukooli Central legislator Solomon Silwany. 

Sources at the Ministry of Foreign Affairs confirmed that Ocheger and three other officers were recalled early this year over financial impropriety. 

One notable transaction under scrutiny involved the transfer of $1m (about sh3.7b) from the high commission’s account to a little-known company — Golden Edge Blocks Distribution Company Limited — which had no prior dealings with the mission. 

This move, sources noted, raised suspicions of attempts to exploit currency exchange rates for personal gain.

Inaccurate exchange rate 

In the report, the Auditor General said on March 30 last year, Nnam wrote to the finance ministry permanent secretary (Ramathan Ggoobi) notifying him that the high commission had made an exchange gain of 2.8b Nigerian naira as a result of converting $5.6m (about sh21b) over nine separate transactions between June 2022 and that month.

Nnam also requested that the gain be used at source to pay for the interim certificates for construction works and consultancy fees for the supervision of the works at the chancery. 

Nnam said the gains were made as a result of the depreciation and devaluation of the naira against the dollar, meaning the exchange rates used were higher than the rate applied during the budgeting process. 

“The exchange rate was processed through M/S Kakumi Bureau de Change, a private company and its agent companies. Other transactions were also processed through Stanbic Bank,” the report indicated. 

However, Akol said the amount declared by the high commission as a gain was inaccurate since the computation was not derived from data contained in the Navision System — an IT system used by missions for transactions. 

Ocheger, the then chairperson of the finance committee, explained that the 2.8b naira foreign exchange gain was brought to his attention by Nnam during a meeting.
 
Ocheger said he advised Nnam to formally declare the gain to the finance ministry’s permanent secretary. Nnam told auditors that due to the economic situation in Nigeria at the time, the dollar rate availed would fetch more naira. 

However, he said computation was done by Kanamwangi. On his part, Kanamwangi told auditors that he prepared the schedule showing that the high commission made a gain of 2.8b naira. 

The auditors, however, said this did not represent the foreign exchange gains Nnam referred to in his letter — dated March 30, 2024 — to Ggoobi. The balance on the mission’s currency account then was 1.5b naira, which was less than the amount declared.

Illegal transactions 

The auditors found that the accounting officers at the mission exchanged public funds amounting to $2.8m (sh10.6b) through Kakumi  Bureau and its agents, which irregularly exposed government funds to a risk. 

The auditors said the exchange rates were negotiated through phone calls and WhatsApp messages. 

Afterwards, the funds were transferred from the mission’s dollar account to the Golden Edge bank account, which was provided by Kakumi Bureau and its agents. 

Ocheger explained that he was aware that the mission had a relationship with Kakumi Bureau, which was arrived at after a thorough procurement process. 

However, he said the modalities, details and operations of the transactions were the responsibility of accounting officers and the financial attaché. 

Nnam said the mission entered into an agreement to exchange money at the most favourable open market rates, adding that using commercial banks was always disadvantageous. 

Asiimwe told auditors that by the time she joined the Nigerian high commission in 2019, the agreement between the mission and Kakumi Bureau existed.

Kanamwangi also said he found the practice in place when he joined the mission.

Undeclared forex gain 

The Auditor General noted that although the Treasury Instructions 2017 require an accounting officer to put in place measures to prevent and detect fraud, embezzlement, as well as similar illegal acts for resources under their control, exchange rates done with Kakumi Bureau were at a negotiated rate. 

“Whenever the mission wanted to exchange funds, staff would call Kakumi Bureau to ascertain what the prevailing market rate was and then negotiate for a better rate. These negotiations were done through phone calls and WhatsApp messages. I did not obtain any evidence of receipts issued even after the transaction,” the report said. 

Akol said the computation of the naira transaction for the period under investigation and what had been deposited back in the high commission’s account by Kakumi Bureau showed that 1.2b naira (about sh3.7b) was not banked or declared. 

In an interview with auditors, Muhamad Omor, the director of Kakumi Bureau, confirmed that the transferred amount and rate communicated were negotiated by the mission staff through telephone calls. 

Ocheger explained that he did not know the modalities, details and operations of how the high commission carried out these transactions. 

Asiimwe said the biggest transaction that was made during her time amounted to $800,000, transferred around February or March 2023. 

The money was part of the $901,317 that was received from the finance ministry to pay part of the chancery construction works.

Irregular withdrawal 

The audit also revealed that $67,525 was withdrawn from the high commission’s construction account without authorisation by the Accountant General. 

Another $127,738 (sh477.9m) that was availed as supplementary funds during the financial year 2022/23 to cater for wage deficit and recruitment of local staff, but a big chunk of it (sh451m) was diverted despite indicating that the money was utilised.
 
Kanamwangi said the money was used to pay wage arrears, social security, recruit new staff and foreign service allowance. 

However, Asiimwe confirmed that some funds were used for other activities. 

The mission officials were also pinned for falsifying employment contracts of four recruited staff: Fedelis Odo (security guard), Paul Aliche (driver), Patrician Acham (chief official residence) and Ibrahim Safyanu, whose title was not indicated. 

Embassies to be reduced 

The developments come at a time when the Government is moving to slash the number of embassies abroad. While appearing before Parliament last week, the foreign affairs state minister in charge of regional affairs, John Mulimba, revealed that President Yoweri Museveni has directed the ministry to close some of Uganda’s 38 embassies abroad and reduce the number to around 15, citing cost concerns and ineffectiveness. 

Mulimba said the President instructed them to assess which missions provide the greatest return on investment. This followed the deteriorating performance of Uganda’s foreign missions.

Filed by Mary Karugaba, Dedan Kimathi, Michael Odeng and Charles Etukuri