{"id":369188,"date":"2011-04-05T08:53:17","date_gmt":"2011-04-05T08:53:17","guid":{"rendered":"http:\/\/www.ghanamma.net\/2011\/04\/05\/silent-injustice\/"},"modified":"2011-04-05T08:53:17","modified_gmt":"2011-04-05T08:53:17","slug":"silent-injustice","status":"publish","type":"post","link":"https:\/\/www.ghanamma.com\/2011\/04\/05\/silent-injustice\/","title":{"rendered":"Silent Injustice"},"content":{"rendered":"
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\nThe Independent<\/a> (Kampala)\n<\/p>\n

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Bob Kasango<\/p>\n

1 April 2011<\/p>\n

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In a world that prefers applause to justice, there is loud applause whenever justice is sacrificed on the altar of public appeasement. The rite takes place on the streets. Every time a “criminal” falls victim of the law, society feels some relief from the disease that makes it tremble. The incarceration of each “lowlife” has a pharmaceutical effect on those living the high life.<\/p>\n

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On Feb. 25, Judge John Bosco Katutsi found David Chandi Jamwa, the former Managing Director of the National Social Security Fund (NSSF), guilty of causing financial loss of Shs. 3.163 billion, convicted him, sentenced him to 12 years in prison and imposed other caveats on his future employment and career development.<\/p>\n

The judgment has met with loud public applause and praise and exultation of the Judge and his credentials as a “tough anti-corruption judge”.<\/p>\n

Judge Katutsi is a fine judicial officer before whom I have had occasion to represent a litigant. I was impressed by his management of the case, good grasp of the law and its practical application.<\/p>\n

However, I am not convinced that Jamwa’s conviction was based on the facts before the judge. Of all witnesses that testified in the case, and the judge did well to reproduce at length the testimonies of these witnesses, not one gave incriminating evidence against Jamwa.<\/p>\n

As a member of the Bar, to criticize a judge is always a difficult decision. It is not my good fortune therefore, now or in the future, to engage in active criticism of a judge, especially one who is a darling of the public. The Chief Justice Benjamin Odoki recently had to answer a question from the press as to whether the judiciary would “keep up with the standards set by Katutsi”!<\/p>\n

When we analyze and critique individual judgments handed down by judges of any court, we do not do it because we have anything personal against the judge, but rather because we hold a divergent view.<\/p>\n

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Our critique serves as an appropriate (if limited) mechanism to hold the judges of the court accountable. This does not mean that judges must or do change their views every time they are criticized by the public or by lawyers. But such critiques generate a dialogue (in which judges always have the final say), and hopefully, improves the jurisprudence of our courts.<\/p>\n

The gravamen of Jamwa’s conviction was that he caused financial loss to the NSSF when he sold off bonds before their maturity date. By selling off the bonds before their maturity date, the fund earned less by Shs. 3.163 billion. I use the words “earned less” advisedly. According to the judge, these bonds having been sold earlier than their maturity date and the NSSF having earned less than it would have had the bonds been sold on the maturity date, means Jamwa caused financial loss to the NSSF.<\/p>\n

What the judge did not say in his judgment, which was clearly brought out by the testimonies of the witnesses before him, is that the NSSF made a profit of Shs. 6.6 billion from the bond transaction. It could have made Shs 9.72 billion in total if the bonds had been sold at maturity. And so the impression created in the public is that NSSF made only losses as a result of the bond transaction.<\/p>\n

More curiously, the judge does not highlight the fact that the proceeds from the bond transaction were re-invested as a strategic decision of the NSSF to realign its investment portfolios. Jamwa, in his defense, made this point. He said the proceeds were re-invested in fixed deposit accounts in pounds, dollars, and Euros. Bonds issued by the government are very low-risk investments. However, they also offer lower rates of return than other investments.<\/p>\n

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Jamwa explained that the decision to move NSSF’s investments portfolio to higher risk but higher yielding ventures was collectively reached. He said on July 10, 2007, the then Minister of Finance Ezra Suruma approved this decision in a letter that Jamwa tendered in Court. In fact, Jamwa got approval to strategically shift 50 percent of the NSSF investment portfolio to the even riskier investment in equities. Only 30 percent would remain in bonds and 20 percent in fixed assets.<\/p>\n

By not addressing the fact that NSSF re-invested the funds from the bonds transactions in other interest-bearing accounts, stocks and hedge funds, Judge Katutsi showed how lawyers often tend to be legalistic and not business-minded. We ought to open our minds to the business side of a transaction and not just the legal intricacies.<\/p>\n

A similar misreading of an investment decision nearly occurred when Martin Bandebire, who was NSSF Corporation Secretary under Jamwa and became acting MD after him, told a committee of parliament that in April 2008, NSSF bought 238,200,100 shares in the Kenyan telecom giant Safaricom for Shs 44 billion. By the time of Bandebire’s testimony to parliament, the shares had lost 30 percent of their value. The investment decision of itself was a prudent and the loss in value was occasioned by the political crisis in Kenya and the world economic recession – two factors that could never have been foreseen at the time of the investment Had the Chairman of the NSSF Board, Vincent Ssekkono, not intervened, the committee members would have punished Jamwa for it. Ssekkono told the committee that losing that money was not criminal. Business is a gamble, he said, you make money and sometimes lose money.<\/p>\n

<\/p>\n

A consideration of the decision to realign NSSF’s investments was, therefore, imperative. The judge ought to have considered whether long term, the decision to take the funds out of the Bond market into other investment options hurt the NSSF financially or was a financially better investment decision? To the extent that that is not addressed in the judgment, the judge in my view did not explore the entire transaction to its logical business conclusion.<\/p>\n

The judge asked “whether the NSSF was in dire financial need” when Jamwa executed sale of the bonds. The answer was in the negative. He therefore concluded that there was no need to sell off the bonds before maturity. But the judge did not consider the fact, for example, that part of the proceeds of the bond transaction, could have been invested in time-barred ventures, like the purchase of shares in Safaricom. Such time-specific investments do not wait for NSSF’s bonds to mature. From that perspective, NSSF had to take a proactive decision as to whether to wait for the bonds to mature and miss out on, hopefully, more profitable ventures or sell and re-invest. These decisions are primarily business decisions and not legal games and so business sense was the primer in taking them. As Judge Katutsi noted, very few Ugandans are as competent as Jamwa to make such decisions. Those of us who have benefited from his expertise at personal and business level can testify to that.<\/p>\n

Judge Katutsi ought to have called for evidence on the performance of the other investments in which NSSF had re-invested the funds from the bond transaction. It is only then that the Judge would have come to the conclusion as to whether or not in real terms, a loss was suffered by the NSSF or not.<\/p>\n

Jamwa did not act arbitrarily and the Judge agreed with testimony to that effect and acquitted Jamwa of the alleged offence of Abuse of Office.<\/p>\n

From the evidence before the judge, all the actions taken by Jamwa were the result of collective decisions. There was a Board position that the NSSF should re-align its investment portfolios to “higher yield investments”, a position arrived at after a study. The Investment Analyst, Chief Investment Officer, Management Investment Committee (MIC), the Board and the Minister of Finance, all reviewed the study and reached the consensus that the NSSF should withdraw from the bond market. Jamwa implemented a management decision taken at the very top level.<\/p>\n

If there was financial loss suffered by NSSF, therefore, was that loss occasioned by Jamwa?<\/p>\n

It is settled that criminal responsibility is individual responsibility.<\/p>\n

But who is an individual? And who exactly is responsible? The traditional answer to the first question is: a natural person; the traditional answer to the second question: a natural person who voluntarily did an act and knowingly contributed to the criminal result.<\/p>\n

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\nSilent Injustice<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

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