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IGP Kayihura faces probe over SRPS’ Shs 15bn

By Independent Team

Revenue police disbanded in 2006, no accountability ever given, impounded goods not explained

Inspector General of Police (IGP) Maj. Gen. Kale Kayihura is in trouble over failure to account for at least Shs 15 billion while he was commander of the Special Revenue Protection Services (SRPS) between 2001 and 2006.

SRPS, a military revenue policing outfit that was created directly by President Yoweri Museveni and was headed by his then Military Assistant Kale Kayihura, terrorised much of eastern Uganda, especially Busia, Tororo, Bugiri and Iganga districts, as it fought smugglers. It was disbanded in 2006 after the presidential elections following a public outcry that had prompted the president to suspend its operations during his re-election campaign.

Two weeks ago while examining the Auditor General’s report for 2001 – 2002, Parliament’s committee on commissions, statutory authorities and state enterprises established that SRPS did not account for money disbursed between July 2001 and February 2002, which money had been irregularly given to the revenue police body given that its creation had no known legal backing. There is also no accountability for the other years SRPS was in operation.

‘For the period of July 2001 to February 2002, Shs1.9 was spent on SRPS to facilitate its operation. These funds were however not budgeted for and were reportedly paid on verbal instructions from the Minister of Finance, Planning and Economic Development,’ the report reads in part.

The MPs inquiry into SRPS could potentially rope in then Minster of Finance Gerald Ssendaula, the Secretary to the Treasury Chris Kassami and the Attorney General Kiddu Makubuya.

‘There are some queries raised in the AG’s report regarding Shs 2.5 billion extended to him [Kayihura] every financial year. URA didn’t receive accountability of this money. We want him to appear before the committee and explain how this money was spent,’ said committee chairman Reagan Okumu, adding; ‘If this matter is to be sorted out exhaustively, Mr Ssendaula might also have to explain why he verbally ordered for the payment of such huge sums of money.’

Another committee member, Kasilo County MP Elijah Okupa told The Independent that: ‘We are inviting Maj. Gen. Kayihura to explain the audit queries but we might also call on Kassami to explain how money was disbursed to a body whose legal status and accounting procedures were not clear, and the attorney general to explain the legal status of SRPS’, committee member and

SRPS did not have a known accounting and administrative structure, raising the possibility that its finances where managed from the pockets of its chief, Kayihura.

When the commissioner-general of Uganda Revenue Authority (URA), Allen Kagina, appeared before the committee, she told MPs that SRPS was not accountable to the tax body but to the auditor general ‘” who apparently had never received any accountability.

‘We had no control over the SRPS,’ Kagina told MPs. ‘They got money from the ministry of finance and they were not accountable to URA. They operated independently from us.’

Kagina refused, however, to shed more light on the matter when The Independent talked to her last week. ‘I have no comment on SRPS,’ she said, emphasing a second time when The Independent prodded further.

But in a dramatic twist, an MP on the committee said URA has now communicated that they have accountability from SRPS for the six years it was in operation. It is not clear what has happened in a few days and why URA never availed this information to the Auditor General before. The accountability will be passed on to the AG and if it is satisfactory, then the matter will be rested.

IGP Kayihura is scheduled to appear before the committee on April 21 but in the interim, The Independent has learnt of a series of frantic house-cleaning efforts by SRPS, among then the closure of its operating account which for some unknown reason remained operational three years after the body was shut down and its activities incorporated into a URA-constituted force.

A/c no. 1330012 ‘” NBC

One of the answers Kayihura will have to provide is the activities of account number 1330012 in the National Bank of Commerce(NBC). The said account, in the names of Ulinzi (which means protection in Kiswahili), was the main operating account of SRPS. It is suspected that money continued to be deposited on the account from the treasury even after the organisation was officially disbanded. It continued to be operated by ‘Office of The Military Assistant to H.E The President’, the position Kayihura held before his appointment as IGP until two weeks ago. If that be the case, then Kayihura may have to account for up to Shs 22.5 billion!

Issues of the choice of an irregular account name for a public organisation aside, the circumstances around the closure of this account have also raised several questions pointing to the possibility of inexplicable transactions. The account was closed on the basis of a March 31, 2009 communication to the bank manager on a letterhead of Special Revenue Protection Services, Office of the Military Assistant to H.E The President, P.O Box 72076 Kampala and signed by Maj. Herbert Mbonye (Head of Operations) and Maj. David Muhanguzi (Head of Administration & Personnel).

On the same day the letter was written [March 31], a reply acknowledging receipt and action was sent to majors Mbonye and Muhanguzi with attachment of bank draft no. 112430 for Shs 46,011 in favour of SRPS ‘being balance on the above account closed less our [bank] charges’.

While the two majors worked with Kayihura in SRPS, they were redeployed in 2006 upon its disbandment and are currently working in the office of the UPDF Chief of Personnel and Administration at Bombo army headquarters. It is therefore not clear on what basis they instructed the closure of the account, especially at the time Parliament was beginning its investigations into SRPS finances.

It is also not clear whether Kayihura has continued to hold the office of military assistant to the president even while IGP and whether the two were acting on his instructions to close the account. If so, it is also not clear why Kayihura did not close the account in 2006 but chose to do so now.

Where are impounded goods?

According to our sources, MPs also want Kayihura to explain where the goods impounded by SRPS were taken or where the proceeds from their sale/auction were kept. During the six years of its operation, SRPS impounded billions of shillings worth of goods from smugglers but many of the goods were reportedly not turned over to URA partly because, ‘SRPS operated as a separate entity’ only complementing URA’s role in tax collection and administration.

For instance it was reported in the local media in June 2005 that SRPS had impounded 2,213 cartoons of Supermatch Cigarettes worth over Shs 400m. The media quoted then SRPS spokesman Lt Bahoku Barigye saying the cigarettes that had been smuggled from DR Congo were impounded at Kireka, Kampala.

In another report in January 2003, SRPS announced that it had impounded smuggled and counterfeit goods worth over Shs 150m in a two-day operation on the Kampala-Busia road. The goods included polythene bags worth Shs 12m, at least 48,000 litres of neutral spirit used for manufacturing liquor worth over Shs100m seized at Lugazi, and 36 cartoons of counterfeit Bic pens worth Shs 5m impounded in Rubaga.

Sources say no accountability was ever provided to URA or the Auditor General for the impounded goods, let alone the procedure for handling them.

If a conservative estimate of Shs 1 million worth of smuggled goods was impounded every day for the six years SRPS operated, its operatives could have had Shs 2.2 billion worth of goods in their hands!

*****

The Independent failed to get Kayihura to give his side of the story even after repeated attempts to get him through his aide. The aide said the IGP was travelling that instead he had suggested that we speak to his personal assistant Ambrose Murunga. We did not speak to Murunga because the matters in question did not relate to his current posting at the police.

Enoch Walugembe, URA’s assistant commissioner for enforcement too could not answer his phone as did Maj. Muhanguzi, the supposed head of administration and personnel of SRPS.

Whatever his side of the explanation, a litany of questions will certainly face Kayihura when he appears in Parliament, including allegations that SRPS did not buy vehicles for its operations until 2005 and even then, they were disguised as imports for an international NGO to avoid paying taxes. Government agencies pay taxes on vehicles they purchase.

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