Masaka City security team has halted the takeover of Zamo Building over a defaulted loan worth billions by Diamond Trust Bank (DTB). The structure is owned by the former Bukoto South County Member of Parliament Muyanja Mbabali.

Private security firm HASH on Thursday night stormed Zamo Building on Kampala Road in Masaka City and placed new locks on the instruction of DTB, to pave the way for the handover of the property to another owner.

The DTB takeover of the building was short-lived after officers from the Masaka Central Police Station swung into action with instructions from the Masaka City Security Committee and ordered the private security guards to vacate the premises citing procedural irregularities.

New Vision has learnt that the Commissioner Private Security Organisations and Private Firearms, Charles Ssebalambilidde, had written to the office of the Greater Masaka region Police commander, instructing him to supervise the deployment of the private guards manning the property in a letter dated November 21, 2022.

DTB faulted

Masaka City Deputy Resident City Commissioner in charge of Nyendo-Mukungwe Division, Mastulah Naava, who received a petition from Mbabali on November 2, 2022, said it was procedurally improper for DTB to take over the property without a court order.

“By procedure, DTB should have notified the city security committee of those developments for us to clear the process. We have been informed that Mbabali and the Bank have some unresolved issues in court,” she said.

New Vision has also learnt that the private guards received instructions from Kampala Metropolitan Police to take charge of Zamo buildings in Masaka and Kampala.

Businesses affected

However, the move affected clients and businesses housed in Zamo Building in Masaka including law firm Xander Co. Advocates and Premier Credit Financial Institution.

Provate security guards at Zamo Building before they were removed by Police. Photo by Dismus Buregyeya

Xander proprietor Alexander Lule said the private security guards locked his office with clients’ files inside while Premier Financial institution clients failed to access the premises on Friday and Saturday.

"Someone will be held accountable for this interruption of my business. How could they take over the building and close our office premises with padlocks at night? The procedure is strange," he said.

The private security guards left the premises on Friday at 9.30 pm and the Police took over the security of the building.

Police sources said the tenants operating on Zamo Building in Masaka would be given access to their offices at 9:00 am on Monday.

Area LC1 chairperson Joseph Mulindwa said he was not informed about the orders from Kampala to take over the building.

Who bought Zamo Building?

Masaka city businessman Robert Ssekigye is reported to have purchased Zamo Building in Masaka City after the property was advertised and auctioned. Ssekigye told journalists that he expects DTB to hand over the property to him.

“I expect DTB to hand over the building to me. They should refund my money if they have failed to sort themselves out with Mbabali,” he said.

Mbabali said DTB was wrongly attaching Zamo Building in Masaka City which was not part of the collateral he presented to secure a loan. 

Lawyer Patrick Mugisha who represented Mbabali said they had filed a case in Masaka High Court seeking a temporary injunction restraining DTB and Ssekigye from disposing of the property.

“We had initially secured a court order stopping them from proceeding with the entire transaction, but they remained adamant and sold the property,” Mugisha said.

Mbabali said he also secured a caveat from the High Court on the same property, adding that he is protesting against the bank’s failure to furnish court with accounts of all financial transactions and dealings belonging to his business firm, MFK Corporation.

DTB went ahead and listed several of Mbabali properties among those set for auction last year. 

They included Nkozi Hotels in Mpigi and commercial buildings in Kampala and Masaka.