KAMPALA —The police are investigating Equity Bank’s involvement in a fraudulent gold transaction that resulted in a Canadian national, Clifford Potter, losing over $3bn. The bank is accused of failing to comply with anti-money laundering regulations and facilitating the fraud.
According to a letter written by SSP Ayub Waisswa of the Criminal Investigations Directorate (CID) to Equity Bank’s Managing Director, “It’s alleged that one Clifford Max Potter, a Canadian citizen, and others deposited about USD 1,000,000 to the above bank account between 2016 and 2019, under a fraudulent gold scheme of Stephen Bairukanga, and the money was immediately withdrawn from the above account.”
Potter’s lawyer, Fred Muwema, claims that the bank should have done due diligence to verify the legitimacy of the gold dealer, Stephen Bairukanga, and reported suspicious transactions to the Financial Intelligence Authority. “When you get suspicious money on your account, the bank is supposed to verify where this money is coming from. If you don’t have paperwork that is clear, by law, the bank is supposed to report those suspicious transactions to the Financial Intelligence Authority,” Muwema said.
However, a senior official at Equity Bank, who spoke on condition of anonymity, maintained that the bank was not involved in the transaction. “The bank is not involved; this was a transaction between two parties. We have seen the letter from the lawyer, and it’s a matter we have been handling internally, but the matter is between two people; let them sort themselves. If they call us to court, we will come and explain our position, but as far as we are aware, the bank is not involved,” the official said.
Muwema countered that the bank’s argument was untenable. “Under the law, when the bank fails to do its duty and money gets lost, the bank is liable because it facilitated the transaction. Whereas the bank says that was a relationship between two people, it’s true, but the bank must ensure that those who hold accounts with them don’t use it for suspicious transactions. If they say they are not involved, why have they been blocking people’s accounts? The banks are the gatekeepers against illicit transactions,” Muwema argued.
Potter is not the first person to lose billions in fake gold transactions. In the past, the police have investigated many cases in which foreigners have lost a lot of money in the hope of getting gold that never materializes.”
