Recently, Ugandan media has been awash with reports of a financial saga involving the Bank of Uganda (BoU), where hackers and fraudsters allegedly stole billions from the country’s money collection centre in a daring cyberattack.
The news has sparked widespread concern about the robustness of the country’s financial security systems, with calls for immediate action to safeguard public funds and the integrity of the central bank.
However, BoU authorities have come out boldly to clarify the matter. In a statement, the central bank acknowledged the attempted breach but refuted claims of massive losses, stating that proactive measures had been taken to minimise the impact.
They assured the public that systems have been fortified, investigations are ongoing, and any compromised funds are being recovered.
“Our systems are uncompromised and secure. The BoU systems were never hacked. Two incidents of fraud were initiated outside the BoU IT systems,” Deputy Governor, Michael Atingi-Ego, clarified at a press.
The Deputy Governor further mentioned that instructions were received by BoU to pay the wrong beneficiaries, leading to the diversion of funds. “We have since recovered $8.205m of these funds though and we are pursuing the balance. The ongoing investigation will support recovery efforts,” he stated.
Atingi-Ego addressed the situation, noting that there has been significant speculation and confusion in the media, which is not ideal, especially when it involves the central bank.
He emphasised that while people are free to speculate, such discussions should be grounded in accurate information. He clarified that the issue revolves around two transactions related to debt service payments.
According to Atingi-Ego, the disputed transactions involved significant sums intended for international debt service payments.
On September 12, 2024, a payment of $6.134 million meant for the World Bank was mistakenly sent to a company called Roadway Company Limited through MUFG Bank in Japan.
Similarly, on September 28, 2024, a payment of $8.596 million intended for the African Development Fund was erroneously transferred to MJS International in London, UK.
Upon discovering that the funds had not reached their rightful recipients, the Bank of Uganda promptly initiated internal investigations and alerted key government agencies, including the Uganda Police Force, the Criminal Investigation Directorate, and the Financial Intelligence Authority.
The central bank also acted swiftly to recover the misdirected funds, taking all necessary steps to address the situation.
Atingi-Ego stated that the Bank of Uganda’s top priority was the swift recovery of the diverted funds.
He explained that immediate action was taken, including instructing their correspondent bank, Citibank, and the banks where the fraudulent transfers were credited, to freeze the funds due to suspected fraud.
He announced that $8.205 million of the funds sent to MJS International in London had been successfully recovered and credited back to the Uganda Government Consulate Fund account at the Bank of Uganda.
Addressing media speculation, he clarified that the recovered funds are not frozen but have been securely returned to the government account.
Efforts are ongoing to recover the remaining $391,000 from the London bank through Citibank’s assistance.
However, he noted that the $6.134 million paid to Roadway Company through MUFG Bank in Japan remains unrecovered due to the Japanese bank’s lack of cooperation.
Atingi-Ego further clarified that if the cooperation from MUFG Bank in Japan had mirrored that of the UK bank, the recovery of funds would have been swifter.
Despite the challenges, the Bank of Uganda is working closely with domestic and international partners, including the Financial Intelligence Authority, to ensure the recovery of the remaining funds.
He also highlighted the ongoing investigations, which are expected to shed light on the full scope of the fraudulent transactions and bolster recovery efforts.
He added that the Office of the Auditor General is conducting an independent investigation to provide additional oversight and transparency.
Dismissing media speculation about the amounts involved and the perpetrators, Atingi-Ego urged the public to rely on official information rather than unverified stories.
Addressing allegations that the Bank of Uganda’s IT systems were hacked, he firmly denied the claims, stating, “It is absolutely not correct.”
He explained that hacking involves unauthorised access to computer systems or networks, and there is no evidence whatsoever of such an event within the bank.
“These fraud incidents were initiated outside the Bank of Uganda IT systems,” Atingi-Ego stated. He explained that the fraud stemmed from external instructions to pay the wrong beneficiaries.
The diversion of funds occurred beyond the bank’s IT infrastructure, which remains secure, operational, and uncompromised.
“Forget the nonsense out there. The Bank of Uganda IT systems were never hacked,” he reaffirmed, adding that investigations are ongoing to uncover where the diversion occurred, how it was executed, and who was involved.
Atingi-Ego reiterated that the Bank of Uganda’s systems remain “operational, secure, and uncompromised.”
Addressing speculation about staff involvement in the fraudulent transactions, he clarified that it is standard procedure for the police to take statements from staff members who handle such matters or are involved in payment processes.
He stated, “To the best of our knowledge, no Bank of Uganda staff has been implicated thus far.” He dismissed rumors circulating on social media, asserting that they are baseless and lack any grain of truth.
Bank of Uganda staff have fully cooperated with authorities, and no evidence has emerged implicating them in the fraud.
In concluding remarks, Atingi-Ego urged the public to remain patient and allow government agencies to complete their investigations.
He assured that the Bank of Uganda will release a detailed report on the incident once the investigations are concluded.
For now, he advised relying on official information from the agencies conducting the investigations to avoid misinformation.
“This idea of bashing the central bank is not good,” he stressed, reaffirming the bank’s commitment to transparency and accountability.
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