The prosecution arraigned two top officials in Cogebanque, who are being charged with misusing property in public interest and favouritism in discharging their duties.
The directors in the case are Joel Kayonga, the bank’s Commercial Director, and George Ndizihiwe the Credit Director and they both appeared before the judge at Nyarugenge Primary Court for bail hearing on Wednesday, September 21.
The duo is accused of authorising a Rwf6bn loan to one David Byuzura under his company name dubbed Builder Holdings Ltd, yet he did not fulfil the necessary requirements.
According to prosecutors, the duo committed the alleged crimes last year when they authorised a loan of Rwf6bn to Byuzura in December to buy a tobacco factory worth Rwf10 bn.
The prosecutors said that a report from the National Bank of Rwanda (BNR), which regulates the banking industry, indicated that this loan was awarded without meeting the necessary criteria.
Among the criteria that were not met include the fact that the businessman had not raised the requisite 30 per cent equity that was needed to get the loan facility, and that there were discrepancies around the value of the factory that was being purchased.
The prosecution also told court that they had a statement from the bank’s CEO raising the alarm, advising the senior executives to verify some of those anomalies before authorising the loan.
The CEO, prosecutors said, had earlier recused himself from the transaction citing conflict of interest, arising from the relationship he has with some of the leaders of the factory.
The prosecution requested the court to remand the duo arguing that there are reasonable grounds to suspect that they committed the alleged crimes as well as fear to escape justice among reasons.
However, in their defence, the two senior bankers denied the charges saying the decision to authorise the loan was taken by the bank’s board.
Addressing the judge, Ndizihiwe pointed out that all procedures in loan acquisition were followed and dismissed the claim by the CEO that he had recused himself from the transaction as a lie.
Instead, he accused his boss of absconding responsibility, challenging him to produce a written note attesting to his recusal.
Furthermore, he said that before providing the loan, the dossier is evaluated by two different committees and finally approved by the board, which was all followed to the letter.
On his part, Kayonga said that they don’t know the reason why they are in custody yet the loan has been fully paid back with the interest of more than Rwf 600 million and did their responsibilities.
In addition, he said that the favouritism crime is a lie saying that instead the CEO is the one who had a relationship with a staff of the said company and he is also the one who linked him with the company to help them with their loan.
The presiding judge said that the ruling will be delivered on September 26.