The Ministry of Finance, in coordination with the Bank of Uganda, is in the process of implementing a wide range of the Auditor General’s recommendations to address major derelictions in its Information Technology (IT) systems that led to last year’s Shs53b heist, but the mood is far from cheerful.
The ministry lacked adequate IT system checks, including basic protocols like two-factor authentication—a security system that necessitates two forms of identification to access an account—by at least two system administrators in the authorisation of payments to foreign banks.
These deficiencies, the back-to-back audits by PwC and Auditor General revealed, were exploited to spirit away $6.134m (Shs22.3b), meant for debt repayment on to the World Bank’s International Development Association (IDA), and $8,596,824 (Shs31.2b) for payment to the African Development Fund (AFD), to phony bank accounts in Tokyo and London respectively.
The Ministry of Finance spokesperson, Mr Jim Mugunga, confirmed the development but was quick to add that they have, over the years, upgraded and improved the IT systems to keep in tune with advancements in technology.
“The Auditor General advised reforms have in part already been undertaken, but more specific ones will continue to be implemented since the fiscal and monetary roles are intertwined businesses and a going concern of the sector,” Mr Mugunga said at the weekend.
Monitorbroke the story in November last year. Consequently, 10 ministry staff, including the then Accountant General Lawrence Semakula, were arrested in February and charged with money laundering, corruption, causing financial loss, electronic fraud and abuse of office, before the Anti-Corruption Court and remanded to Luzira prison.
They have since been granted bail, while hearings of the cases are ongoing. Far from settling the matter, highly placed sources told this newspaper that questions are emerging about the “invisible hand” of a top technocrat in the ministry in planning the heist.
“The technocrat runs the show on many aspects, and there’s a high likelihood that, working with a few junior staff, they set up the whole thing. Sadly, some innocents were caught up due to the need to take urgent action,” Treasury sources intimated.
The extent of the role of the said technocrat in the heist varies in degree depending on who one talks to, which, according to sources, has since “opened room for more plausible theories.”
By the time of the heist revelations, the ministry was already mired in dogfights over supremacy, which, according to some accounts, “likely” ensnared Mr Semakula, who was due to retire this year.
The Auditor General’s probe flashed light only in the Accountant General’s office, IT and Treasury Services Department, which ordinarily interface with transactions with the Bank of Uganda.
Nine officials from the Ministry of Finance, implicated in the Ministry of Finance heist through the Bank of Uganda, appear in the dock at the Anti-Corruption Court in Kampala on February 18, 2025. PHOTO/JULIET KIGONGO
Asked about the matter, Mr Mugunga said whenever such a major incident happens anywhere, there is bound to “be questions and pointing in all directions.”
“It is no different from us just because we are the Ministry of Finance. To this end, we left such inquiries to the authorised state agency that investigates: the police. Our prayer is that this matter be left to the police to handle to a logical conclusion. What we know is that such cases never die off…as police checks and get more sophisticated, we believe a lot more people responsible for the incident will be held accountable,” he noted.
In the same vein, there is growing disillusionment among the ministry’s top-level management over among others, according to sources, selective promotions and retirements, staff retention and micro management.
A handful of staff who have clocked the mandatory age of 60 have been handed extension contracts, while several of their contemporaries have been exited immediately. “Where is the fairness? Where is the merit? When will others scale heights?” one senior staffer told Monitor.
Mr Mugunga wondered how this newspaper measured the discontent at his workplace.
“The Ministry of Finance is as competitive as any other progressive agency. I do not know of the alleged disillusionment, but the good thing is that in official processes, appointments and disappointments, when they happen, they are supposed to be done by laid down procedures.”
But perhaps nothing has brewed discontent and elicited staff consternation than the ministry’s new office block that several staff describe as a “special purpose vehicle for eating” by a few senior managers.
One of the ministry’s staff involved in the construction project recently invited a handful of work colleagues for house housewarming at their country home in the Luweero/Nakasongla area. Jaws dropped at the palatial real estate, besides the other rumoured property listings in the Muyenga and Bunga suburbs. Construction of the ministry’s new office complex on plot 2-12 and 2A Sir Apollo Kaggwa jumped from Shs44.2b in 2019 to Shs93.799b in 2023, while the completion timelines have been shifting.
During the ministry’s end of year party in December 2023, staff were told that the building would be ready for occupying in the first quarter of 2024. Almost two years later there is no in sight, while the “project cost overruns” have been variously discussed in the ministry’s top management.
Parliament probe In May, the parliamentary Public Accounts Committee led by the Butambala County MP Muwanga Kivumbi quizzed the ministry’s leadership led by the Undersecretary, Mr Edward Sengozi Damulira, over the delayed completion of the project and the several cost overruns.
Mr Damulira assured MPs that the complex will be ready for occupation within five months. Insiders, however, cast doubt on the timeline. Sources revealed that there is “growing disdain about the multiple cost variations of the project” and “while it is common knowledge that few individuals have their hands deeply involved.”
Mr Mugunga, pressed about the matter, said: “I have no information about the project because it is more on the operational and administrative side than technical.”
