Bank Of Uganda To Release Sudhir’s Withheld Forex Bureaus’ Money

Bank of Uganda is going to pay Sudhir Ruparelia Bank of Uganda is going to pay Sudhir Ruparelia

Bank of Uganda, the statutory regulator of the financial sector in Uganda, has since taking over Dr. Sudhir Ruparelia commercial bank, Crane Bank Limited, has been engulfed in several legal battles with the businessman.

In some of the concluded litigations, Dr. Ruparelia has been having an upper hand registering small but vital victories in court. The recent triumph for the mogul has been having the central bank to refund money he deposited for operating four forex bureaus - Speke Hotel, Speke Forex (Kampala Road), Stanhope Forex and Red Fox.

According to court records, Dr. Ruparelia had accused the Central Bank of holding onto the money in question in a bid to coerce him into negotiating a case where he is accused of purportedly causing the collapse of Crane Bank.

BoU filed the case accusing Dr. Ruparelia of allegedly removing over UGX200Bn from Crane Bank (CB). The regulator claimed the loss led to the alleged insolvency of Crane Bank in 2016. Crane Bank was later sold to DFCU Bank in 2017 under unclear circumstances. 

After closing Crane Bank, the central bank also closed the four forex bureaus which Dr. Ruparelia was running at the time. The businessman demanded the return of the money he had deposited with the regulator as a security for running the business of the bureaus. The Central Bank said no, leading to the litigation.

But after fruitless back and forth negotiations between the two parties over the refund, the businessman filed a case at the commercial section of the High Court. He was questioning the rationale of holding the money he had deposited as security for running the forex bureaus even when the Central Bank had closed them.

By holding onto his money, Dr. Ruparelia reasoned that Bank of Uganda (BOU) was denying the opportunity of the funds in alternative business ventures and by extension denying him profit from such new ventures.

BoU maintained initially, that they were holding the money legally pending the determination of the case they filed against Sudhir. But the businessman contended that the forex bureaus were separate legal entities and had nothing to do with the Crane bank let alone the lawsuit he was involved in with the central bank.

The Central Bank has however, finally agreed to make a refund totaling UGX277, 817,453 including money that Sudhir had paid for renewal of the bureaus operation licenses. The Central Bank’s Deputy Governor Louis Kasekende signed the consent arrangement while Sudhir signed on behalf of the bureaus.

The Commercial Court’s assistant Deputy Registrar, Lilian Buchana signed and sealed the consent in order to give it a legal effect. While Sudhir had asked for damages of over UGX200m as well as interest plus costs of the suit, the Central Bank did not agree to that demand. These are the issues that now remain for court to determine. The Central Bank was represented by MMAKS and company advocates while Magna and company advocates represented Sudhir.

Last modified onSunday, 31 March 2019 00:39

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