ISO and MTN in cat & mouse chase due to MTN office raid

ISO raids another MTN office

The Internal Security Organisation (ISO) operatives on Friday raided MTN Nyonyi Gardens offices and recovered items vital in their current investigations of espionage and tax evasion. The Friday raid is the third raid by ISO against the telecom giant that is currently under investigations.

A senior ISO source confirmed to UGANDANZ that they also took with them some computers and vital documents that would aid them in their investigations. Efforts to get a comment from MTN on Saturday proved futile. UGANDANZ learnt that ISO operatives entered the facility at midday and conducted an eight hour office search. Staff were kept away as security scanned through trail of documents and accessed computers. Security sources said the investigation into tax evasion and espionage were jointly being conducted by the ISO, the Police and the Chieftaincy of Military Intelligence.

ISO on July 2, 2018, raided the MTN data center in Mutundwe, a Kampala suburb, over security concerns and alleged tax evasion. During the raid, ISO operatives arrested the facility engineer, Keefa Musasizi, but later released him. The ISO boss, Col (rtd) Frank Bagyenda Kaka, said they raided the offices for security reasons.

Following the ISO investigations, four MTN staff have since been arrested and deported over reports that they had been spying on top government officials. The latest deportee is the company’s chief executive officer, Wim Vanhelleputte, who was deported on Thursday evening. Besides Vanhelleputte, three other MTN staff have been arrested and deported.

They are; Olivier Alexander Benoit Prentout, a French national, who has been working as the chief marketing officer; Annie Bilenge Tabura, a Rwandan national who has been the chief marketing officer and Elisa Muzzolini, who has been heading the mobile money department. Meanwhile, the Uganda Revenue Authority (URA) is on the spot after it emerged that the tax body reduced tax arrears worth sh360b that MTN Uganda owed the Government to only sh64.6b under unclear circumstances. As a result, security agencies have launched investigations into the matter with a view to establish how URA reduced the tax arrears, sources within the Internal Security Organization (ISO), who are privy to the investigations, revealed.

A letter dated February 14, last year, signed by Hilda Bakanansa, the URA acting assistant commissioner litigation, the tax body had reduced the amount to sh64.6b following a mediation process. The tax position was in respect to corporation tax, excise duty on airtime, excise duty on international incoming calls and Value Added Tax. The letter was addressed to the registrar mediation and the High Court commercial division.

However, security officials say the reduction puts the Government at the risk of losing about sh300b in revenue that would have come from the telecommunications company after assessment, a move that raised concerns among government authorities, thereby sparking off an investigation.

“We are out rightly against the tax reduction and we are going to object to it, until we find out how it was reduced,” revealed a senior operative in ISO.

License fees

Sources say there have also been queries raised by Cabinet after the Uganda Communications Commission reduced the MTN license fees from $100m to $50m. “But Cabinet intervened and they agreed that the license fee for MTN should be $108m,” the source stated. The source added that the money had been reduced because MTN was allegedly under-declaring its revenues. Last July, President Yoweri Museveni warned telecom companies against involvement in tax evasion.