A long-standing client has taken Centenary Rural Development Bank to the Commercial Division of the High Court, accusing the financial institution of illegally deducting more than Shs1.1 billion from his accounts .
Mapeera House serves as the headquarters of Centenary Bank
Mr Emmanuel Musisi, trading as Commrade General Supplies, argues that the bank manipulated his loan computations, imposed unlawful penalties, and made unexplained withdrawals, ultimately causing the disappearance of funds he now wants
In his suit, Mr Musisi seeks to recover what he describes as a liquidated sum of Shs1.1 billion, alleging it represents accumulated overcharges, irregular interest calculations, and fraudulent deductions.
“…The plaintiff (the businessman) prays for an order of recovery of a liquidated sum of S1.1b arising from overcharges on interests, penalties, and variances in loan balances, illegal deductions on loans, and facilities advanced to the plaintiff by the defendant,” the documents show.
According to the case documents, the disagreement stems from an agricultural loan of Shs505 million that the businessman allegedly obtained in 2018. The facility was to be repaid quarterly over a 120-month period, with the final instalment due in 2028.
However, by May 2023, five years into the repayment schedule, Mr Musisi says he began receiving persistent pressure from the bank’s loan recovery team, urging him to ensure timely payments.
He found this unusual because, by his calculation, he had already paid Shs662 million, which he believed had fully settled the principal. The repeated calls from the bank, he says, heightened his suspicion that something was amiss.
Matters allegedly escalated when individuals he describes as “strangers” began making claims regarding his secured property, prompting him to lodge a caveat to prevent any unauthorized transfer.
“Following claims from strangers then, the plaintiff instructed his lawyers of M/S Kitimbo Associated Advocates to lodge the registered proprietor’s caveat to avoid a possible fraudulent transfer without notice,” the court documents show.
After halting further payments, Mr Musisi commissioned an independent audit by Gingo and Partners, Certified Public Accountants.
The audit report, according to his suit, revealed significant discrepancies in the interest and penalties charged on his loan account. It allegedly showed that Centenary Bank had, over several years, made unauthorised deductions which accumulated to Shs1.1 billion.
The businessman claims that despite repeatedly alerting the bank to the need for a proper reconciliation of his accounts, his concerns were ignored. He further says he reached out to the Bank of Uganda seeking regulatory intervention, but the central bank did not resolve the issues to his satisfaction.
His legal team later advised him to pursue a formal reconciliation with Centenary Bank, but he insists the institution remained unresponsive.
In a statement, Centenary Bank disputed the allegations.
The bank asserts that Mr Musisi defaulted on his loan obligations “despite several restructures and engagements,” forcing the institution to begin the legal process of recovering the loan through the sale of property pledged as security.
“When the bank decided to recover through disposing of his property given as security, he sued the bank, claiming that he had been overcharged interest and proceeded to caveat his property in order to prevent the bank from selling,” the bank said.
“The bank shall adhere to the court process until the suit is concluded or otherwise resolved between the parties,” it added.