NSSF MD, Richard Byarugaba
By ISAAC IMAKA
In Summary
Top managers of the Fund to answer queries over 24 deals a whistleblower says were done fraudulently
The Inspector General of Government has opened
wide ranging investigations into National Social Security Fund and
several top managers over allegations of fraud and corruption involving
24 deals.
Lady Justice Irene Mulyagonja said yesterday that
her office is studying details of an exposé, which accuses the Fund’s
top leadership of messing up workers’ savings for personal gain.
“We received it (the dossier) and it is yet to be registered or to be evaluated,” she said.
The document, a copy of which the Daily Monitor has, cites 24 scenarios in which the whistle-blower claims the Fund’s top bosses have flouted procedures and ignored expert opinion for “selfish aggrandisement”.
The allegations have not been verified by this newspaper, so the bosses cannot be named for legal reasons.
However, the developments, if proved correct,
could send the Fund into turmoil again, following various investigations
that saw the sacking and prosecution of former boss David Chandi Jamwa
two years ago.
Case in point
In one of the latest alleged fraudulent transactions, is the sale of a plot of land in Namirembe at Shs650 million to a private company, Malibu Holdings Ltd, yet the value had been put at Shs1 billion by the valuer.
In one of the latest alleged fraudulent transactions, is the sale of a plot of land in Namirembe at Shs650 million to a private company, Malibu Holdings Ltd, yet the value had been put at Shs1 billion by the valuer.
In a July 27, 2012 memo to Mr Ellis Biryahwaho,
the fund’s head of procurement, a real estate analyst, Mr Moses Dennis
Lutalo, had advised that NSSF either sells the land at the real market
value or drops the idea of selling it because Shs650 million was below
the market value.
“The first option should be to consider the plot
at a price that put into consideration the funds RRR as stipulated in
the investment policy. The working shows a price in the ranges of Shs1.4
billion,” Mr Lutalo wrote.
“The second and most feasible option would be to consider acquiring access to the plot since the current plot has no access and keep this plot for future development.”
But a December 20,2012 dated land transfer folio signed by the Fund Board chairperson and the managing director, Mr Richard Byarugaba, shows that the management disregarded the advice and sold the land at the lower price.
“The second and most feasible option would be to consider acquiring access to the plot since the current plot has no access and keep this plot for future development.”
But a December 20,2012 dated land transfer folio signed by the Fund Board chairperson and the managing director, Mr Richard Byarugaba, shows that the management disregarded the advice and sold the land at the lower price.
The top management, the dossier claims, also
committed Shs25b of workers’ savings to buy shares in Umeme without
approval from the Solicitor General as required.
The whistle-blower says the Solicitor General
refused to clear this transaction and even advised that the Umeme
concession was irregular as per the Parliament findings.
A copy of a January 10 letter from the Solicitor
General to the NSSF corporation secretary shows that NSSF jumped the gun
and bought the shares without approval and attempted to secure it
retrospectively.
“Since the transactions had already been done, NSSF does not need the legal advice of the office of the solicitor general,” the letter reads.
“Since the transactions had already been done, NSSF does not need the legal advice of the office of the solicitor general,” the letter reads.
“Seeking legal advice from this office is not a mere formality.”
It is also said members noted with concern at a meeting that the board was not involved in approval of buying Umeme shares amid reports of conflict of interest and investigation by Parliament.
It is also said members noted with concern at a meeting that the board was not involved in approval of buying Umeme shares amid reports of conflict of interest and investigation by Parliament.
The dossier also pokes holes in the joint venture
that NSSF entered into with SBI to build houses at Lubowa, saying it was
not approved by the Solicitor General. This meant that it was an
illegal transaction. About $1 million (about Shs2.5b) loan was given to
SBI and was never recovered even when former Board Chairperson Vincent
Ssekono highlighted that it should be recovered.
It notes that when Mr Ssekono left, the managers
negotiated with SBI and one of them was “paid $300,000 (about Shs750m)
and the loan waived, contract signed and money lost.”
In another transaction, the whistle-blower says through a one
man transaction, more than 10 acres of NSSF land in Lubowa have
disappeared without the knowledge of the board.
It notes that one of the bosses colludes with
neighbours in Lubowa, and they shift pillars marking boundaries of NSSF
land, make titles and he is paid Shs200m per acre and the money is
channelled through a money lending company, owned by the said boss, so
as not to be easily detected.
In a statement last evening, Mr Richard Byarugaba,
the NSSF managing director said all deals in question were done in good
faith and that the allegations were unsubstantiated.
“Our investment in Umeme was undertaken in line with our investment procedures and thorough due diligence,” he said.
“Our investment in Umeme was undertaken in line with our investment procedures and thorough due diligence,” he said.
He said the joint venture dissolution terms with
SBI was approved by the board, Contracts Committee, Management
Investments Committee, PPDA and the Solicitor General.
On the Namirembe land disposal, Mr Byarugaba said a decision was taken because it had no access road.
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