DFCU Bank on September 12, 2019 wrote a letter to Bank of Uganda explaining its decision to return 48 properties the bank has been occupying illegally.
These buildings belonged to property mogul Sudhir Ruparelia and his Meera Investments and were housing former Crane Bank which he owned before it was illegally sold to DFCU by Bank of Uganda.
The decision to rescind the interest to purchase these properties by DFCU comes after a historic court Victory in favour of Sudhir Ruparelia in August in a case filed against him by Bank of Uganda.
The Bank in a court redress sought a refund of shs 397 billion from the businessman which he allegedly pulled out of Crane Bank before it was taken over by DFCU.
The decision not to purchase the contested 48 properties by DFCU means they will soon vacate the branches and look for new homes.
However, DFCU earlier rubbished these reports that the bank was seeking to relocate the branches and disregarded the information as fake news.
“Following the Court’s ruling above, dfcu Bank Limited in a letter dated September 12, 2019 communicated to BOU its decision to exercise its option to rescind its interest in purchasing the 48 properties pursuant to clause 8.7 of the Agreement,” part of the report released Wednesday reads.
Adding that, “as part of rescinding of this purchase, dfcu will return to Bank of Uganda Certificates of title for Meera Investments Limited properties and requires Bank of Uganda to pay to dfcu the net book value of the properties recorded in the assets and inventory compilation report as at October 20, 2016.”
Background Story
The 200 billion deal (UGX) DFCU Bank struck with BOU to acquire Crane Bank in 2017 has since gone sour. The latest information reveals that troubled DFCU bank has conceded defeat and agreed to return 22 properties which the bank occupied illegally after fraudulently acquiring Crane Bank that belonged to property mogul Sudhir Ruparelia and his Meera Investments Limited.
At this point, observes contend that DFCU could have envisaged that not even the regulator- Bank of Uganda could secure the 22 former Crane Bank branches.
DFCU has since invited bidders that want to provide consultancy services at it seeks to relocate to new areas in various districts and towns across Uganda.
The bank has been operating its business in buildings/properties belonging to Meera Investments Limited since it acquired Crane Bank Limited in 2017.
In August it emerged that the bank was misled by city Law firm Sebalu & Lule Advocates to illegally transfer title properties into its name yet the properties belong to Meera Investments Ltd even though it had leased them to Crane Bank Limited.
Sebalu & Lule Advocates who have been barred by court from representing the same bank against city tycoon Sudhir Ruparelia for being conflicted. The law firm misled dfcu Bank to transfer leasehold titles from Crane Bank Ltd during the controversial takeover two years ago.
In a leaked document titled Transfer of former Crane Bank household properties, dated May 8, 2017, “the law firm skipped important aspects of the law including the fact that banks are not allowed to invest in business for fear of conflict of interest with their clients, apart from their main premises” banking analysts say.
“In light of the lengthy of time between the completion of date and when dfcu can vividly exercise the option to rescind the purchase of household properties, our recommendations is that the transfer be registered immediately,” reports Eagle Online.
The whole procedure was entangled with fraud as there was no consent from the Landlord (Meera Investment Ltd) before transferring the lease to another party.
