The High Court has delivered a scathing indictment of Finance Trust Bank Limited, exposing what the judge described as unlawful, high-handed, and outright illegal conduct in a botched loan recovery operation that saw a customer\u2019s vehicle seized and the man himself detained for hours.<\/p>\n\n\n\n
In a ruling that sends shockwaves through Uganda\u2019s banking sector, Justice Dr. Lubega Farouq found the bank and its agents guilty of breaching a loan agreement, wrongfully confiscating property, and violating constitutional rights.<\/p>\n\n\n\n
The dispute stems from a Shs20 million loan issued in November 2016 to businessman Nkoto Jackson. The loan was secured strictly using land in Kibuku District\u2014not a motor vehicle.<\/p>\n\n\n\n
Nkoto made his first repayment but ran into financial difficulty on the second installment. Instead of following lawful recovery procedures tied to the agreed collateral, the bank\u2019s agents allegedly took matters into their own hands.<\/p>\n\n\n\n
On the morning of February 26, 2017, bank operatives descended on Nkoto\u2019s home in what reads more like a security operation than a financial transaction.<\/p>\n\n\n\n
They forcefully entered the premises, jumped into his commercial Fuso truck, and drove it away to the bank\u2019s Pallisa branch\u2014without any legal process authorizing such action.<\/p>\n\n\n\n
The bank later attempted to spin the incident as a voluntary arrangement by the customer. But the court dismantled this claim, pointing to glaring inconsistencies and missing evidence.<\/p>\n\n\n\n
\u201cThe explanation\u2026 is not satisfactory,\u201d the judge ruled, rejecting the bank\u2019s version of events.<\/p>\n\n\n\n
In a decisive finding, the court held that the bank had no legal right whatsoever to seize the vehicle.<\/p>\n\n\n\n
The loan agreement clearly identified land\u2014not the truck\u2014as collateral. By targeting the vehicle instead, the bank acted outside the contract and the law.<\/p>\n\n\n\n
The judge concluded that this amounted to a clear breach of contract and further constituted the tort of wrongful detention of property after the bank refused to release the vehicle despite repeated demands.<\/p>\n\n\n\n
But what truly stunned the court was what happened next.<\/p>\n\n\n\n
After taking his vehicle, bank agents reportedly locked Nkoto inside their offices from 9:00am to 4:00pm\u2014a full eight hours\u2014effectively stripping him of his freedom without any legal authority.<\/p>\n\n\n\n
The bank did not even attempt to meaningfully challenge this claim in court.<\/p>\n\n\n\n
Justice Lubega did not mince words.<\/p>\n\n\n\n
\u201cThere is no doubt that the detention\u2026 was illegal and contrary to the law,\u201d he ruled, citing constitutional protections on personal liberty.<\/p>\n\n\n\n
Legal experts say the finding borders on false imprisonment\u2014a serious civil wrong with constitutional implications.<\/p>\n\n\n\n
The seized truck was not just property\u2014it was Nkoto\u2019s livelihood.<\/p>\n\n\n\n
For nearly three months, the vehicle remained out of his reach, cutting off his daily income. The court acknowledged the economic damage and disruption caused by the bank\u2019s actions.<\/p>\n\n\n\n
In the end, the court awarded:<\/p>\n\n\n\n
The bank\u2019s counterclaim was thrown out entirely.<\/p>\n\n\n\n
The judgment reads as a warning shot to financial institutions across Uganda: defaulting on a loan does not strip borrowers of their rights.<\/p>\n\n\n\n
Debt recovery, the court emphasized, must follow the law\u2014not intimidation, force, or improvised enforcement tactics.<\/p>\n\n\n\n
This case lays bare the risks of aggressive loan recovery methods and raises serious questions about internal controls and accountability at Finance Trust Bank Limited.<\/p>\n\n\n\n
For Nkoto, it was a costly and humiliating ordeal. For the banking sector, it may mark a turning point.<\/p>\n","protected":false},"excerpt":{"rendered":"
The High Court has delivered a scathing indictment of Finance Trust Bank Limited, exposing what the judge described as unlawful, high-handed, and outright illegal conduct in a botched loan recovery operation that saw a customer\u2019s vehicle seized and the man himself detained for hours. In a ruling that sends shockwaves through Uganda\u2019s banking sector, Justice […]<\/p>\n","protected":false},"author":27983,"featured_media":42211,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jnews-multi-image_gallery":[],"jnews_single_post":{"format":"standard"},"jnews_primary_category":[],"jnews_paywall_metabox":[],"jnews_override_counter":[],"footnotes":""},"categories":[98],"tags":[9867,9866,9868,119],"class_list":["post-42210","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-dr-lubega-farouq","tag-finance-trust-bank-limited","tag-nkoto-jackson","tag-uganda-news"],"yoast_head":"\n