Kaliro loses UGX 10billion in 7-year fraud

Kampala, Uganda | THE INDEPENDENT | The Parliamentary Local Government Public Accounts Committee has uncovered a financial scandal involving Kaliro District Local Government, which has resulted in the loss of Shillings 10 billion in pension, gratuity, and ex-gratia funds over a span of seven years. This scandal spans from 2014 to 2021 when various anti-corruption agencies initiated inquiries into the questionable operations of Kaliro District.

The revelation stems from an inquiry in the Auditor General’s report, indicating that some pensioners were either overpaid or underpaid with the intent of committing fraud. Furthermore, district officials are faulted for their failure to deduct both local service tax and pay-as-you-earn (PAYE) from salaried workers, leading to significant financial losses for the government.

They are also accused of deducting payments for unsanctioned loans by some local government workers, who deny any knowledge or involvement in the approval of such credit facilities. According to Acting PAC Chairperson Mutebi Wanzala, who also serves as the Nakasongola MP, an irregular payment of 492.7 Million Shillings was made as a gratuity to 12 retired employees, which far exceeded the expected pay grade.

Mutebi notes that Kaliro Chief Finance Officer, Godfrey Mutome, conspired with other public officers to create a fictitious general account at Stanbic Bank’s Iganga branch, diverting funds from the recognized DFCU account to this unknown account. In response, the Kaliro District Chief Administrative Officer, Samuel Bigirwa, accused Mutome of working clandestinely with other district officials to duplicate the supplier number of the legitimate district account in DFCU and attaching it to their fictitious account in Stanbic Bank.

This led to the finance ministry officials unknowingly depositing a portion of the district funds into this account. Bigirwa notes that Mutome, who was the sole signatory on this fictitious account, used his influence to conceal information about these fraudulent transactions, which only came to light after his suspension late last year. Mutome, who also served as the Kaliro District Workers’ Sacco Chairperson, wrongly deducted funds as monthly Sacco remittances from his colleagues without their consent.

Mutebi has further revealed that the Auditor General is currently conducting a forensic audit of the financial transactions in Kaliro District in hopes of identifying the loopholes responsible for the mismanagement of public funds. Mutebi has instructed Bigirwa to lead efforts to recover the overpaid funds to pension beneficiaries as a means of demonstrating accountability for the money allocated to the district.

On his part, Bigirwa argued that cases involving the loss of pension funds and general mismanagement of the payroll system are pending in the courts of law, awaiting a verdict before taking further action. However, Bigirwa notes that they will prepare a recovery plan for the Shillings 11.4 Million that was irregularly paid to retired workers who were no longer on the payroll.

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