London, January 8, 2024 — In a significant legal development, the UK Supreme Court has dismissed attempts by dfcu Bank and its shareholders to appeal a £170 million (UGX825.8 billion) lawsuit brought against them by shareholders of the defunct Crane Bank in Uganda. Dr. Sudhir Ruparelia, the billionaire shareholder of former Crane Bank, leads the legal battle against dfcu Bank and its associated entities.
The Crane Bank shareholders allege corruption within the Bank of Uganda, accusing senior officials of engaging in a corrupt scheme to take control of Crane Bank and sell its assets at an undervalued price while misappropriating public funds. The lawsuit contends that dfcu Bank and other defendants participated in this fraudulent scheme, purchasing Crane Bank’s assets at a gross undervalue and effectively paying a bribe.
Initially challenging the jurisdiction of the London High Court, dfcu Bank and its shareholders argued that the seizure and sale of dfcu Bank were sovereign acts of the Ugandan government, invoking the foreign act of state rule. However, on July 26, 2023, the London appellate court justices overruled the High Court ruling, stating that the sale to dfcu Bank was a straightforward commercial transaction on standard terms.
The Supreme Court’s recent ruling refuses permission to appeal and orders dfcu Bank to pay £1,875,000 (UGX8.8 billion) in court costs to Crane Bank shareholders. Additionally, the quintet, including dfcu Bank, must refund £1,250,000 (UGX5.9 billion) with 4.5% interest per annum, previously paid as costs when the High Court initially dismissed the case.
This legal setback for dfcu Bank and its shareholders paves the way for the main case to proceed, marking another win for Crane Bank shareholders in a series of legal victories against both dfcu Bank and the Central Bank in both Ugandan and UK courts. The unfolding legal saga continues to cast a spotlight on the intricate dynamics within the financial sector and the aftermath of the Crane Bank saga.