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After losing out to Sudhir in Crane Bank Saga, BoU again dragged to court over liquidation of Greenland Bank

With just weeks since losing out to Tycoon Sudhir Ruparelia in a multibillion case involving the fraudulent sale of Crane Bank, the Central Bank of Uganda (BoU) has again been dragged to Court this time by the shareholders of Greenland Bank Ltd protesting the delay in liquidating their bank.

The group of 27 shareholders have petitioned the court indicating that Bank of Uganda (BoU) has taken a very long time to conclude the liquidation process of their bank.  

Led by Mr. Sulaiman Kaweesi, the aggrieved shareholders state in their petition before the Commercial Division of the High Court that the bank was placed under liquidation 21 years ago, but the process is still ongoing.

“A declaration that the continued liquidation of the 2nd defendant (Greenland Bank) for more than 21 years without accountability to the plaintiffs is irregular, unreasonable and in bad faith,” the court documents dated March 1 read in part.

“A declaration that the entire process of liquidation of the 2nd defendant is marred by massive fraudulent acts committed by the officials of the 1st defendant (BoU),” the petition further reads.

The group also want the court to order the Central Bank to render the true account of the management of the properties that belonged to the companies, associated with the bank at the time of closure.

The above is likely to leave BoU naked again as a fraudulent institution after Supreme Court recently ordered it to directly pay costs at all Court levels and ordered it to revert Crane Bank to Sudhir and the stakeholders, a ruling that effectively sealed the 5yr old case that kicked off the day BoU mafias sold the tycoon’s bank to Dfcu.

Background

Greenland Bank, then an indigenous bank owned by the late Suleiman Kiggundu, was incorporated on August 3, 1990 until April 1, 1999 when BoU closed it and placed it under liquidation. This, Crane Bank, Cooperative Bank and International Credit Bank before their dubious closure were all indigenous banks with an extensive domestic branch network.

Fraudulent Acts of BoU

The above is a flashback of the June 30, 2017 saga, when Crane Bank Limited (in Receivership) took Mr. Sudhir Ruparelia and his Meera Investments Ltd to court for causing financial loss amounting to UGX 397 billion to Crane Bank in fraudulent transactions and land title transfers.

Crane Bank (in receivership) in its Civil Suit No. 493 of 2017 sought High Court to compel Mr. Ruparelia to pay back the US$80,000,000, US$9,270,172.00, US $ 3,560,000.00, US$990,000.00 and UGX 52,083,995.00 as compensation for breach of fiduciary duty.

While Justice Wangutusi dismissed the UGX397 billion case against Mr. Ruperalia on a technicality, alleging that Crane Bank (in Receivership) lost its powers to “sue” and to “be sued”, thus rendering its suit a nullity, Crane Bank (in Receivership) maintaining that receivership is a management situation, and hence no legal change as to the capacity of a company to sue and be sued which ruling BoU disagreed with and instead kept on appealing till the last court losing at all levels to the tycoon.

Crane Bank started operations on 21 August 1995 “with a vision of being the largest privately owned Ugandan Bank.”

In September 2012, Crane Bank acquired the assets and some of the liabilities of the National Bank of Commerce, a small, indigenous, financial services provider in Uganda that had lost its banking license.

On 30 January 2014, Crane Bank established Crane Bank Rwanda Limited, a wholly-owned subsidiary, with the first branch in Rwanda opening to customers on 30 June 2014.

Later, the Bank was closed by the Bank of Uganda on October 20, 2016, saying that it had failed to comply with a capital call on July 1, 2016. Back then, Central Bank Governor Emmanuel Tumusiime Mutebile said that the Bank takeover was guided by the systemic nature of the under-capitalized institution to avoid financial sector instability.

The bank was a large financial services provider in Uganda. As of 31 December 2015, Crane Bank’s assets were UGX:1.81 trillion, with shareholders’ equity of UGX:281.43 billion. In October 2015, it had more than 750,000 customers.

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