The High Court of Uganda has dismissed a civil suit filed by the NRM Mayor of Entebbe Municipality Fabrice Brad Rulinda against Stanbic Bank Uganda, confirming that the businessman’s conduct amounted to money laundering and validating the bank’s decision to freeze his account and reverse a suspicious transaction.
Rwalinda sued the bank seeking to recover US$73,262.50 (about shs 275 million) that had been credited to his dollar account in 2017 by Green Global Corporation.
He claimed the bank breached its contract by reversing the transaction without his authorization and freezing his account.
However, the Commercial Division on March 16, 2026, presided over by Hon. Justice Stephen Mubiru, found that Fabrice’s account had been used to facilitate payments linked to criminal activity.
Evidence presented in court revealed that Fabrice acted as an intermediary in a complex gold transaction that indirectly involved the March 23 Movement (M23) rebels in the Democratic Republic of Congo.
The judgment highlighted Rwalinda’s own admission that he had knowingly ignored the source of the funds, despite being aware of potential illegal connections. The court held that such “wilful blindness” satisfies the legal standard for knowledge in money laundering cases.
“The transaction looked like ordinary commercial activity but, in reality, it was criminal money laundering dressed as business,” the court noted.
The ruling emphasized that banks are legally obliged to monitor and report suspicious transactions under the Anti-Money Laundering Act.
By freezing Fabrice’s account and returning the funds, Stanbic Bank acted in accordance with the law and protected the integrity of the financial system.
The High Court therefore dismissed Fabrice’s claim, affirming that civil courts cannot assist a party whose claim is based on an illegal transaction. The judgment also sets a strong precedent for banks and regulators in handling suspicious funds.
Fabrice had previously faced criminal investigations related to the same transactions, although no conviction was recorded. The court clarified that the absence of a criminal conviction does not negate the civil liability arising from handling funds derived from unlawful activities.
This judgment underscores Uganda’s stringent approach to anti-money laundering, the responsibilities of banks, and the serious consequences of turning a blind eye to the origin of large financial transactions.
