Op-ED: Racketeering Bank Conspiracy: Conniving to Steal from a Customer -Gyagenda Semakula


By Gyagenda Semakula Zikusooka

The Uganda banking industry is synonymous with filthy, corruption and disgraceful scandals. From the central bank’s currency printing saga, fraudulent closures and purchases of banks and their assets, to commercial banks’ deliberate and syndicated theft from unsuspecting customers of their hard-earned monies and connivance to defraud and auction clients’ properties held as collateral.

The banking industry’s rot spirals right from Bank of Uganda through all its four institutions’ tiers (Commercial Banks; Credit Institutions and Finance Companies; Microfinance Deposit-taking Institutions-MDIs; and SACCOS, financial NGOs and all other non-deposit taking financial institutions). This explains why a restructured banking industry of over three decades still staggers with a paltry and miserable clientele.

The incensed and angry public evidently shows this. The recent gruesome killing of an Indian, Uttam Bhandari, of TFS Financial Services by a Police Constable Ivan Wabwire was just a show of disgust and repugnance to a scamming and defrauding system. The unfortunate Bhandari (RIP) was a victim of the defunct and deteriorating financial industry.

A recent 2021 National Labour Force Survey that encompassed a geographical coverage of 135 districts and 11 cities across the country which majorly focused on a household-based population indicated that only 9 percent of Ugandans had a functional bank account. Banks are continually losing their trust and credibility among the unbanked population. In an economically struggling low-income country, majority of Ugandans are increasingly becoming hesitant to use formal financial services due to the racketeering conspiracies and a lack of trust in the banking system.

The most recent incident is a video that has gone viral on social media where one bold bank customer recorded himself in the banking hall and making claims and loud allegations that the bank stole his money. The account holder Farook Ssekandi is seen lamenting and ranting urging other customers to flee the bank before they fall prey to the same internal fraud schemes. The bank’s lukewarm response continues to expose it and pitches it in bad light of an already charged and suspicious public. Nobody would want to lose a penny to the bank. I am closely following this matter with interest to see how Equity Bank handles the situation that has put it under public scrutiny.

My attention however has for long been drawn to another syndicated bank scam of Cairo Bank Uganda and Housing Finance Bank Limited against a septuagenarian John Kasumba. There has been an ongoing radio talk-show for several months on Impact FM’s morning program; Agenda ku Uganda about this scandal until a few days ago when the the Uganda Communications Commission (UCC) red-flagged the increasingly popular morning radio program to save Housing Finance Bank’s ugly face and its Managing Director, Michael Mugabi. So deplorable and reprehensible!

Housing Finance Bank in one of its fraudulent transactions filled in an application form (unknown to John Kasumba) of a loan debt purchase with Cairo Bank Limited paying up the outstanding loan of shs.320m. On this same application form which Kasumba has no knowledge of, pledges his already developed property land comprised in Kyaddondo Block 229 Plot 1067 Kamuli in Kireka, which is registered in his name. The shrewd and crafty banks, well aware that its client is illiterate and unschooled, crafted this sham application behind his back and did not avail him any copies of the transactions. Kasumba’s initial approach to the bank was to secure a business loan and not a mortgage as the bank chose to do by altering facts to hasten the theft of an illiterate customer’s money.

Kasumba who was working in South Africa some time back had a fixed account in Uganda with Cairo Bank. Cairo sold to him a business idea of a bus company to utilize his savings. The bank would then deduct seven million shillings every month from his bus business account. Little did Kasumba know that Cairo Bank was scheming to nick from him in a syndicated racket with another thieving bank. He received a call from Cairo Bank informing him that they had got a problem and that they had sold his loan to Housing Finance Bank. He vehemently contested and said if they wanted to trade his loan; it would only be with his other bank, Centenary Bank and not an alien bank where he did not even have an account. He refused their offer but was forced into Housing Finance Bank against his will.

Before the illiterate old man could put meaning to what Cairo Bank was suggesting, he got a call from Tony Kahaya of Housing Finance Bank detailing to him how the transaction was occasioned and closed and that they only needed his signature as consent. Housing Finance took it upon them and went to Kasumba’s home in Kireka with already drawn consent forms and contracts for him to simply sign and give away his life’s fortune. Kasumba was convinced by HFB’s Kahaya that his repayment would be shs.4m every month as opposed to the shs.7m that Cairo was deducting from him. He was also promised that they would extend to him a loan facility of shs.1.7bn both as a business loan and mortgage with a four year grace period and a repayment period of 20 years. Housing Finance further suggested to him that he would use the loan for a hotel project (having valued his property at Kireka).

This syndicated theft was thrift and hasty for Kasumba’s thought process. He took the glittering allures from a bank scammer as utopia. He confessed to me how he sometimes praised Housing Finance Bank for the courtesy of going to his home to deliver contracts for him to sign. This princely treatment bluffed him into thinking that he was a bank’s VIP client. After getting his signatures on all documents, Housing Finance Bank assured him that they would extend the loan facility after getting the valuation reports for his property. This is where all his woes started. His patience waned. All the glittering promises had vanished into oblivion. The shrewd Kahaya exited the stage and paved way for Michael Mugabi, the then bank’s Operations Manager. Mugabi told the old man that they had evaluated his worth and realized he did not have the capacity to service his mortgage at shs.12m per month. While signing the documents that he couldn’t read and understand, he was told he would pay shs.4m monthly. This was another shocker! At this time, Kasumba knew that he had been conned and cheated. He made efforts to reach out to then Managing Director Nicholas Okwii who listened and confessed to him that the bank’s representatives had made some mistakes which would be corrected.

Two subsequent regimes of both Nicholas Okwii and Matthias Katamba tried to correct this mistake but must have been defeated by their own internal systems. Kasumba confesses that the duo listened to him and tried to bring this matter to closure but junior staffs that were charged with the mandate to operationalize directives were determined to rob him of his fortune. He has no kind words for Mugabi (now MD) who he says is his tormentor, por siempre!

It is just an indisputable fact that these racketeers and scams are occasioned under the watch of the regulator and other agencies and the corrupt are in bed with the government.
Banks will continue to greedily steal from their clients until the public charges at them like Farook Ssekandi.

Bank of Uganda should rein in without leaving victimized customers with little recourse.

The writer is a Journalist, Lawyer & Theologian



  1. I am still confused on how quick Mr. Kasumba was transferred to Housing finance bank, anyway waiting to hear more about this interesting story


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