Ugandan banks unveil code of conduct to mitigate fraud

Commercial banks operating in Uganda under their umbrella body, the Uganda Bankers Association (UBA), have unveiled a set of measures that are aimed at mitigating fraud in the banking industry.

 The Banking Industry Guidelines on Mitigation of Fraud (BIGF) and the revised Code of Conduct (COC) are to ensure that convicts of financial crime or those blacklisted face the full force of the law.

The BIGF aims to tackle the pressing issue of fraud by developing comprehensive guidelines on incident reporting and information sharing as well as formulating a strategic roadmap for the industry to effectively combat fraudulent activities.

COC encompasses the essence of professionalism, ethics, and responsible conduct for all staff of UBA member institutions and the secretariat.

It also entails punitive measures against banking staff who breach confidentiality obligations or collaborate with fraudsters to share information or compromise access to systems.

Speaking at the launch of  the guidelines on Monday, Sarah Arapta, the UBA chairperson, explained that it is time for policymakers to take tough action against fraud.

“Fraud poses a significant threat, and our industry is evolving rapidly, therefore, aim to combat it effectively with these new guidelines,” she said.

Arapta explained further that the Banking Industry Guidelines on Mitigation of Fraud (BIGF) address evolving fraud trends, empowering customers, enhancing standards, and fostering collaboration with domestic and international anti-fraud agencies.

 “Our Code Of Conduct (COC) sets minimum standards for ethical conduct among banking staff, ensuring adherence to best practices and professionalism,”  she said.

“Collaboration is key and therefore we’re working with stakeholders, including regulatory authorities, law enforcement agencies, & industry associations, to create a safer financial environment,” she added.

The Bank of Uganda Deputy Governor, Dr Michael Atingi-Ego, also underscored the importance of the  frameworks.

“I think they (frameworks) initially tie in together and also, I want to agree that the launch of these two documents at the same time is very, very important because they speak to one another,” Dr Atingi-Ego said.

 “So the initiative that we have just undertaken is critical or it’s a critical stepping stone towards the strengthening the bedrock of trust and confidence that underpins our financial institutions,” he added.

At their first Financial Fraud Forum last year, one of the biggest challenge facing the fight against financial crime as cited in the different views was what they say is a weak legal regime which provides for very light penalties to culprits.

UBA Executive Director, Wilbrod Owor, urged the banks to maintain their work schedule throughout weekends and public holidays, saying that most crimes are executed on such days were vital departments are closed.

According to the Uganda Police, Cyber (Computer) crimes increased from 286 in 2022 to 258 cases in 2021, while crimes reported by Banks and Other Corporate Frauds were recorded at 82 in 2022 compared to 102 in 2021.

However, out of the total cases taken to Court, 303 cases secured convictions, 03 cases were acquitted, 16 cases were dismissed while 2,327 cases are still pending. Comparison of cases of Economic & Corruption Crimes from 2020 to 2022 show a  general increase in cases of Economic & Corruption Crimes reported to the Police countrywide from 10,089 cases in 2020 to 13,207 cases in 2022.