Shareholders of defunct Crane Bank are contemplating legal action, contesting how the financial institution was inexpensively sold to DFCU by the Central Bank.
Bank of Uganda (BoU), last year in January 27, sold off Crane Bank after placing it under receivership in October 2016 because it had become extremely bankrupt.
However, shareholders of Crane Bank insist that the Central Bank ignored quite a number of points; violated laws and made numerous blunders while considering sale of Mr.Sudhir Ruparelia’s bank.
Apart from flouting provisions of the financial institution act while selling the bank to DFCU, Bank of Uganda forgot its mandate of catering to the interests of the shareholders as well, as provided for under the Act, shareholders say.
The documents obtained by this website, the shareholders add that, “The nature, structure and detail of the agreement are directly intended to defraud the shareholders and to benefit DFCU and Bank of Uganda at the expense of the Shareholders.”
“Because the interests of the shareholders were completely ignored and deliberately disregarded, DFCU now finds itself embroiled in a series of expensive and ruinous suits relating to this transaction, valued at several million dollars, from which it may never recover. DFCU is going to wish it had never bought these assets in the first place.”
“The shareholders are now determined to sue the Central Bank for the fraud perpetrated in this transaction.”
Whereas the Central Bank is immune under the Financial Institutions Act, shareholders maintain the immunity doesn’t cover fraud.
“Because there is fraud against the shareholders, Bank of Uganda, Bank of Uganda’s employees and legal advisors involved in the fraud shall also face ruinous civil and criminal legal liability.”