Bank of Uganda has suffered yet another huge blow after their application to become amicus curiae (friend of the court) in the ongoing Ham Vs DTB case at the court of appeal was questioned and quashed due to lack of neutrality in this matter as a regulator. This was further emphasized by Ham Enterprises LTD lawyers who informed court that according to the earlier press release statement from Bank of Uganda after the High Court judgement on this case, it was evident that BOU was providing a shoulder for DTB to cry on.
On 7th October 2020, the High Court Ordered Diamond Trust Bank to pay Ham Enterprises the unlawfully withdrawn 120Billion, Legal Fees and 9.6Billion Interest per year after losing this multi-billion case where the Bank had illegally debited Ham Enterprises Accounts over a spread period of 10 years.
The High Court Judgement was appealed by Diamond Trust Bank challenging the court on its decision which determined that Diamond Trust Bank Kenya had illegally carried out financial business with Ham Enterprises Limited without a license to operate in Uganda from Bank of Uganda.
As soon as the High Court made this historical judgement, many Ugandans welcomed it except a few parties that seemed aggrieved by the High Court’s Judgement and these included the Uganda Bankers Association (UBA) and Bank of Uganda who continuously issued press releases one after another.
In the October judgement, Court categorically issued directives to Bank of Uganda which is the implementing authority under the Financial Authorities Act 2 of 2004 as amended to take all necessary actions and measures to ensure that the provisions of the law is implemented in accordance with the intention of the law such as to protect the Ugandan economy from illegal hemorrhages and uncontrolled flows of financial resources and to ensure that financial institutional business in Uganda is operated within the letter of the law to protect the nascent banking business industry in Uganda. It should be noted that in the judgement, the High Court simply reminded Bank of Uganda to do its regulatory work through the above stated directives.
In the press statement that was issued by Bank of Uganda earlier, the institution made it clear that they were siding with DTB, a position that has been questioned by many Ugandans up to now.
BOU has been observed taking lenient stands on foreign banks operating in Uganda than the indigenous ones. It should also be noted that many local banks have been closed for cases less severe than illegal operations which not only cause financial loss to the country but also compromise the legit operations of the banking sector.
One would also ask why now that Bank of Uganda is coming out to give an expert opinion on the case where the high court gave a directive to the same regulator to do its work in ensuring that the law is followed as banks carry out their operations. This further pins Bank of Uganda as a party that is not neutral in this matter and the appellate judges had to take a stand to strike out their amicus curiae application.
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