A High Court ruling has drawn Entebbe Mayor Fabrice Brad Rulinda into a complex international gold transaction that the court concluded bore the hallmarks of money laundering linked to illicit mineral trade in DR Congo.
In a judgment delivered on March 16, 2026, Justice Stephen Mubiru of the Commercial Division of the High Court ruled that the circumstances surrounding large transfers into the mayor’s bank account amounted to money laundering, even though the civil case he filed against Stanbic Bank was ultimately dismissed.
The case arose after Rulinda sued Stanbic Bank Uganda for reversing $73,262.5 (UGX 271.65 million) that had been credited to his account in 2017.
But in examining the transaction, court found that the evidence suggested the account had been used in a suspicious financial arrangement involving gold trading and intermediaries linked to armed rebels in eastern DR Congo.
In a striking passage of the ruling, Justice Mubiru concluded: “This transaction … does not generally look like normal commercial activity. It is criminal money laundering dressed up to look like normal commercial activity.”
The suspicious transfers
According to court records, two large transfers were wired into Rulinda’s dollar account at Stanbic Bank’s Bugolobi Village Mall branch in August 2017.
The deposits amounted to $422,957.5 (UGX 1.56 billion) and $73,262.5 (UGX 271.65 million), both sent through Citibank on behalf of Green Global Corporation.
The bank flagged the transactions because they were inconsistent with the previous pattern of activity on the account.
Within days, large sums were withdrawn in cash, prompting the bank to report the activity to the Financial Intelligence Authority (FIA) as a suspicious transaction.
Court examines gold deal with M23 rebels
During the trial, court reviewed statements that Rulinda had previously given to police investigators regarding the origin of the funds.
In those statements, he described acting as a broker in a deal involving gold purchases connected to actors linked to the M23 rebel group operating in DR Congo.
The ruling quotes him describing how funds were routed through his bank account:
“They agreed to transfer money through my account then I would withdraw and in turn give the money to the M23…”
Court noted that the transaction involved parties seeking to purchase gold while attempting to avoid direct dealings with the rebel group.
Justice Mubiru also referenced international sanctions against the M23 movement, noting that the UN Security Council had condemned the group’s activities and imposed sanctions on its members.
“Wilful blindness” to source of funds
The judge was particularly critical of Rulinda’s explanations about the source and purpose of the money.
At different points, he described the funds as being connected to gold trading, oil deals, construction projects and other business ventures.
But court found that he had produced no documentation supporting any of those explanations.
“The plaintiff offered no explanation for the source of the funds … he categorically stated that he was not interested in knowing the source of the funds,” the judgment reads in part
Justice Mubiru described this conduct as “wilful blindness”, a legal doctrine where a person deliberately avoids confirming facts that strongly suggest criminal activity.
Court explained that deliberately ignoring suspicious circumstances can amount to knowledge of wrongdoing.
Red flags identified by court
In analysing the transaction, court pointed to several warning signs commonly associated with money laundering.
These included unusually large transfers inconsistent with the account history, rapid withdrawals of large sums of cash, lack of documentation explaining the transactions, inconsistent explanations about the purpose of the funds, and the involvement of actors linked to illicit mineral trade.
The judge concluded that the pattern of activity strongly suggested criminal conduct.
In the ruling, Justice Mubiru stated: “The defendant has led strong circumstantial evidence proving that it is more probable than not that the funds in question were obtained through unlawful conduct.”
He therefore ruled: “The plaintiff’s impugned conduct amounted to money laundering.”
Stanbic Bank’s actions
Stanbic Bank had reversed one of the transfers and returned the funds to the sending bank after being alerted that the money might be linked to an investment scam.
The bank also froze the account while investigations were ongoing.
Several Land Titles Created on Namanve Industrial Park Land CancelledJustice Mubiru agreed that the bank acted properly in identifying the suspicious activity and reporting it to regulators.
Court found that the bank had acted as “an ordinary honest/reasonable banker” in investigating and reporting the unusual transaction.
However, the judge ruled that Stanbic went too far by returning the money without a court order or the customer’s authorization.
That action, he said, technically breached the bank’s contractual obligations.
Why the mayor still lost the case
Despite finding that the bank breached its contract, court dismissed Rulinda’s lawsuit.
Justice Mubiru invoked the legal principle “ex turpi causa non oritur actio,” which bars courts from enforcing claims that arise from illegal conduct.
Because the transaction itself was linked to unlawful activity, the judge ruled that Rulinda could not recover the money.
“The plaintiff can neither maintain an action against the defendant nor is he entitled to the remedies sought,” court ruled.
The case has been, therefore, dismissed with costs awarded to Stanbic Bank.
Wider implications
Legal observers say the decision highlights the increasingly complex role banks must play in combating financial crime while still respecting customer rights.
The judgment confirms that banks must report suspicious transactions and may freeze accounts when money laundering is suspected.
At the same time, it cautions that banks cannot unilaterally confiscate or return funds without legal authority.
The ruling also underscores the judiciary’s firm stance against financial crimes linked to illicit mineral trade in conflict regions.
For Uganda’s banking sector and regulators, the case may become a key reference point in the ongoing effort to strengthen anti-money-laundering enforcement while maintaining the integrity of the financial system.
Matter may proceed to the Court of Appeal
The legal battle may not end with the High Court decision, as the plaintiff has indicated plans to challenge the ruling in the Court of Appeal.
Through his lawyer, Isaac Ssali Mugerwa of Bluebell Legal Advocates, the plaintiff intends to file a Notice of Appeal, arguing that the High Court committed several substantial legal errors in its judgment.
Among the key grounds is the contention that the court effectively made findings suggesting money laundering in a civil proceeding, thereby determining issues of criminal liability without a criminal trial, conviction, or proof of a predicate offence.
Counsel argues that the court relied on allegations of money laundering to dismiss the plaintiff’s contractual claim despite the related criminal proceedings having been dismissed for want of prosecution and no competent court having made a finding of criminal liability.
He further contends that the court determined issues of alleged criminal conduct that were neither properly pleaded nor framed for determination in the High Court proceedings.
The appeal will also argue that the court improperly shifted the burden of proof onto the plaintiff by requiring him to demonstrate the legitimacy of the funds instead of requiring the bank to justify its interference with money standing to the credit of his account.
Counsel further maintains that the court failed to hold the bank liable for returning the funds to the remitter, despite anti-money laundering procedures generally requiring suspicious accounts to be frozen rather than funds being unilaterally reversed.
Another key issue to be raised is the court’s treatment of the reversal of funds already credited to the account as lawful, even though the money had already been credited and partly utilised, effectively permitting a debit without the customer’s mandate or a court order.
The appeal will also fault the judgment for failing to distinguish between freezing an account and reversing funds already credited—two actions with materially different legal consequences.
Counsel further argues that the court validated the bank’s unilateral determination of the ownership and disposition of funds in the account, a matter ordinarily reserved for judicial determination.
In addition, the plaintiff is expected to argue that the court misapprehended the evidence on record and drew adverse inferences unsupported by the pleadings or evidence.
Counsel also says the judgment contradicted its own reasoning by acknowledging that banks generally cannot return funds credited to a customer’s account merely on suspicion of money laundering, yet still upholding the bank’s decision to do so in this case.
The appeal will further challenge the delivery of the judgment nearly four years after the close of proceedings, arguing that the delay undermined the court’s recollection of the evidence and led to reliance on statutory provisions and legal reasoning that had not been canvassed by the parties.
Ultimately, the appeal is expected to invite the Court of Appeal to clarify a significant question in Ugandan banking law: whether a bank acting on suspicion alone may go beyond freezing an account and unilaterally reverse funds already credited to a customer.
The outcome could have important implications for banks and businesses operating within Uganda’s increasingly regulated financial system.
