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Red Flags in NGO Transactions in Uganda: A Guide to Suspicious Activities

KAMPALA - As the non-governmental organization (NGO) sector continues to grow in Uganda, it is essential for donors and stakeholders to be vigilant about suspicious transactions that may compromise the integrity of the sector.

Red Flags to Watch Out For

In a new report by Chapter Four Uganda, several red flags have been identified as potential indicators of suspicious activities in NGO transactions. These include:

  • Vague Project Proposals: Where the objectives of a project are unclear, or there is a lack of proper technical and financial information, it may raise suspicions.
  • Difficulty Identifying Partners or Responsible Individuals: When it is hard to identify the individuals responsible for implementing a project, or when the identity of donors or funders is unclear, it can be a sign of suspicious activity.
  • Delegating Work to Unknown Entities: Requests to sub-grant funds to unknown individuals or organizations may indicate a lack of transparency and accountability.
  • Funds and Timelines Not Matching: Excessive funding without a clear plan for implementation within a specific timeline can raise concerns.
  • Unidentified Partners: Where partners are not identified at the time of proposal, there should be a proper description of who they will be or what they will be responsible for to identify them once activities begin.
  • Difficulty Contacting Partners or Beneficiaries: When it is hard to contact partners or beneficiaries due to technological challenges or lack of information, it may indicate suspicious activity.
  • Unjustifiable Requests for Cash Payments: Where requests for cash payments are made without proper justification, especially when dealing with large sums, it can raise suspicions.
  • Requests for Cash Payments to Unrelated Individuals: Where a request is made to pay cash to someone not related to the project, it should be treated as suspicious and reported.
  • Funds Paid into Accounts Not Held in Partner’s Name: When funds are paid into an account that does not belong to the partner or organization, it may indicate a lack of transparency.
  • Payments Made in Countries Where Partners Are Not Based: Payments made in countries where partners are not based can raise concerns and should be reported.

Reporting Suspicious Activities

In Uganda, NGOs are required to report suspicious activities to the Financial Intelligence Authority (FIA) through various forms, including:

  • Form A for cash transactions exceeding UGX 20 million
  • Form B for reporting suspicious transactions
  • Annual report

Failure to report such activities can result in serious consequences.

Conclusion

The NGO sector plays a critical role in promoting development and human rights in Uganda. To ensure the integrity of this sector, it is essential that donors and stakeholders remain vigilant about suspicious activities and report them promptly to the relevant authorities.

By identifying these red flags early on, NGOs can take proactive steps to prevent suspicious transactions and maintain transparency and accountability in their operations.

Contact

For more information or to report suspicious activities, contact Chapter Four Uganda at:

  • Plot 2 Wampewo Close, Kololo, Kampala
  • Phone: +256 790 916 614