The High Court in Mbale has ordered United Bank for Africa (UBA) Uganda Limited to pay Shs128.23 million to a man whose US$30,000 compensation was allegedly diverted through a bank account opened in his name by an impostor.
Justice Farouq Lubega, in a judgment delivered electronically on September 7, 2026, found the bank negligent and fraudulent for failing to properly verify the identity and physical address of the person who opened the account.
The case was filed by Michael Wilson Mazuno, who sued UBA over the loss of Shs108,230,400 that he was due as compensation for injuries he sustained while working as an armed security guard in Afghanistan.
According to court records, Mazuno was employed by Trip Canopy Global Operations Inc., an American private security company, in January 2019. In 2020, he fell from a guard tower and suffered multiple injuries, including spinal damage, hearing impairment and psychological trauma.
He subsequently pursued a workers’ compensation claim against his former employer through his American lawyers and the US Department of Labour’s Office of Workers’ Compensation Programs.
The claim was eventually settled, with Mazuno awarded US$30,000, equivalent to Shs108.23 million at the time. The money was remitted to a bank account that his lawyers believed belonged to him.
However, when Mazuno followed up on the payment, he discovered that an account had been opened in his name at UBA on April 22, 2023, and was allegedly operated by an impostor.
The account, number 0768025176, was opened using Mazuno’s National Identification Number (NIN), but the photograph on the identification document presented by the account opener did not match Mazuno.
The compensation was deposited into the account on August 10, 2023, and withdrawn in two transactions on August 10 and 11.
Justice Lubega said the bank should have detected several red flags surrounding the account and the subsequent transactions.
“The evidence on record shows that the Defendant Bank dismissed Job Ariebi, an officer who was involved in the process of opening the impugned bank account,” the judge noted.
The court heard that the account had been opened only a few months before receiving the Shs108.23 million and had otherwise remained “flat” before the money was deposited.
The judge further noted that although the account had a daily withdrawal limit of Shs15 million, the impostor managed to withdraw Shs85 million on August 10 and a further Shs23.23 million the following day.
Justice Lubega said these circumstances should have prompted the bank to investigate the transactions more closely.
“In my view, the circumstances ought to have alerted the Defendant Bank to the possibility of a fraudulent scheme orchestrated by the impostor, thereby calling for heightened scrutiny and appropriate intervention,” he ruled.
The judge rejected UBA’s argument that it could not be held liable because Mazuno was not a direct customer of the bank.
Justice Lubega held that the bank owed Mazuno a duty of care under the “neighbour principle”, particularly because its actions could foreseeably expose third parties to harm.
“I find that the defendant owed the Plaintiff a duty of care to the plaintiff based on the neighbour principle,” he said.
The court found that UBA failed to verify the physical address of the person who opened the account and did not properly verify the photograph against records held by the National Identification and Registration Authority (NIRA).
The bank’s witnesses told the court that its system for verifying NINs did not provide an applicant’s photograph. However, Justice Lubega found that this did not absolve the bank of its responsibility to properly establish the identity of the person opening the account.
“I find that the Bank breached the duty of care it owed to persons who were reasonably foreseeable victims of harm arising from such negligence,” the judge ruled.
The court also found that UBA acted fraudulently in opening and operating the account.
“I am satisfied that the Defendant Bank acted fraudulently in opening Bank Account No. 0768025176 without properly verifying the identity and physical address of the purported account holder,” Justice Lubega said.
He further found that the bank acted fraudulently by authorising withdrawals of the entire amount deposited despite the account’s daily withdrawal limit.
“I am further satisfied that the Defendant Bank acted fraudulently in authorising the withdrawal of the entire sum deposited in the account without proper justification, notwithstanding the account’s daily withdrawal limit,” he ruled.
Although the judge found that the bank did not directly take Mazuno’s money, he held that its negligence caused the loss and that UBA should therefore compensate him.
“For that reason, I order that the Defendant’s Bank make good of the financial loss suffered by the Plaintiff,” Justice Lubega said.
The court awarded Mazuno Shs108,230,400, representing the money lost, together with Shs20 million in general damages for trauma and distress.
Justice Lubega declined to award exemplary damages, noting that UBA had already been ordered to compensate Mazuno for the financial loss and pay general damages.
The bank was also ordered to pay the costs of the suit and 8% interest on both the Shs108.23 million financial loss and the Shs20 million general damages, calculated from the date of judgment until full recovery.
