KAMPALA —A panel of the Constitutional Court has confirmed that members of the public can take on the Bank of Uganda and challenge it’s decision in court, if the bank freezes any assets or accounts.
Section 124 of the Financial Institutions Act (FIA) shielded Bank of Uganda from being sued for such actions but the Constitutional Court has brought this to an end, arguing that the section giving the central bank such powers contravenes Article 21(1) of the Constitution which makes “all persons equal before the law”.
In an Agust 26 ruling in a matter where a one Peter Ssajjabi and Swift Commercial Establishment Ltd challenged the constitutional powers of BoU to freeze their banked assets, the panel whose lead judgment was given by Justice Cheborion Barishaki has declared both Sections 118 and 124 of the Financial Institutions Act redundant.
This law unilaterally protected the central bank from legal challenges incase they freezed Bank accounts and assets of individuals.
The court has ordered the release of the Mr. Ssajjabi’s Bank accounts, freezed seven years ago.
“No one, not even the BOU can be shielded from answering to the dictates of justice. Unfortunately, Section 124 of the FIA does just that and gives Section 118 of the FIA that undesirable effect. Accordingly, I would hold to the extent alluded to in above, that the impugned Sections 118 and 124 of the FIA, are inconsistent with and in contravention of Articles 2, 20(2), 22, 28 (1), 42, 44 (c), 3(a) and 126 of the Constitution,” the court ruled, and ordered that only Section 34 of the ACA was now the only law application in regards to accounts freezing.
Other members of the panel included Justices Frederick Egonda-Ntende, Irene Mulyagonja, Elizabeth Musoke and Muzamiru Kibeedi.
All consented to Mr. Barishaki’s ruling, which now leaves BOU to court scrutiny in its actions.
The panel has also ordered the Attorney General to puts in place guidelines to make sure the Anti-Corruption Court operates without violating the provisions of Article 34 of the Constitution.
Mr. Ssajabi, the National Secretary East Africa Beneficiary Association was arrested during the investigation of the pension scam, that engulfed the Ministry of Public Service in 2012 and accused of working with a one Mr Ssentogo of Cairo Bank, to create accounts for more than 1,000 ghost pensioners and at some instance, allegedly changed account numbers and transferred some of the funds to his accounts.
His accounts were then promptly freezed by BOU and remain locked seven years later.
However, the Constitutional Court had now reversed this action of the central bank.
Mr. Ssajabi joined EACBA in 1994 to help put pressure on government to pay pension and gratuity to former workers for the East African Community.