Ex-Crane Bank employees, DFCU court battle takes shape

COURT|SUIT|FRAUD|RIGHTS

The looming court battle between former Crane Bank Limited (CBL) employees and DFCU bank has taken shape, with the aggrieved filing a civil suit.

The aggrieved purport that when DFCU took over operations of CBL in January 2017, new employer (DFCU) hoodwinked them, terminated some of their contracts, while others were deliberately frustrated into resigning.

On Thursday, 10 representatives of the 625 employees filed a suit at the High Court civil division in Kampala. They sued through Centre for Legal Aid (CLA).

The representatives are Catherine Achan, Teddy Akullo, Janet Ngwena, Mactose Arinaitwe, Edward Bukenya, and Loy Kiwumulo.

Others are Abbey Mivule, Benjamin Muchwa, Robert Mwanje, and Emmanuel Ngororano.

Some of these employees' contracts were terminated on February 24, 2017, while others departed by October 23, 2017, when court permitted the representative suit.

They accuse DFCU of unjust discrimination, gross human rights violations, fraud, negligence, breach of duty, bad faith, breach of trust and unjust enrichment.

Prior, in October 2016, Bank of Uganda (BOU) took over the operations of CBL, on the premise that the institution had become undercapitalised and posed a systemic threat to the financial system.

Subsequently, in January 2017, BOU informed the public that CBL's assets and liabilities had been transferred to DFCU.

The ex-CBL employees claim DFCU hoodwinked them into believing that a restructuring and integration exercise was underway, yet it was a plot to kick them out.

"The plaintiffs shall contend that the defendant and its servants or agents used fraudulent means to procure or induce the collective termination of former CBL employees for economic, technological and structural reasons," the plaint reads in part.

Auditor General report queries whereabouts of sh5.1b terminal benefits

The Special Audit Report of the Bank of Uganda on Defunct Banks, authored by Auditor General, August 2018, made a startling revelation.

The aggrieved claim DFCU concealed the fact that it (DFCU) applied for and obtained sh5.1b meant for their terminal benefits, under the terms of the Purchase of Assets and Assumption of Liabilities Agreement (PAALA).

"The said transfer was subject to a PAALA executed by the defendant and BOU January 25, 2017 but its terms and conditions relating to staff generally were concealed from the plaintiffs (aggrieved) and several others whose rights and interests were directly affected.

The court registrar is yet to direct DFCU to file its defence.