• Mon. Oct 2nd, 2023

UGANDA, Kampala | Real Muloodi NewsThe Kampala High Court has ordered a permanent injunction prohibiting Rajiv Ruparelia, a former director of the defunct Crane Bank, from “further defaming and spreading damaging and malicious lies” against DFCU Bank.

The saga began in 2018 with DFCU’s acquisition of some assets from Crane Bank Limited (In Receivership), of which Rajiv was a Director and shareholder.

Angered by his bank’s takeover, Rajiv used his well-known telephone/WhatsApp number +256772777773 to personally circulate false news against DFCU to incite the bank’s clients to withdraw money from the financial institution, alleging it was experiencing a liquidity problem.

Some of the communications contained web links to online news sites and blogs that published false information claiming the bank was in a weak position.

On October 5, 2018, DFCU issued a ‘Notice before legal action’ to Rajiv, indicating his telephone number as his address, and copied the letter to the Ministry of Security, the Director-General of Internal Security Organisation, and the Director, Criminal Investigation Directorate, requesting that Rajiv be investigated for malicious behaviour.

In response, Rajiv filed a lawsuit against DFCU, alleging that the bank violated his confidentiality under the banker–customer relationship, misappropriated his private information and that the contents of the notice was defamatory.

DFCU acknowledged Rajiv is a client with accounts at the bank. As part of its “know your customer” duties, the bank obtained Rajiv’s data, including his phone number, to maintain their banker–client relationship.

Rajiv’s Argument

Nelson Walusimbi, Rajiv’s lawyer, maintained that while Rajiv sponsored the damning articles published about DFCU, the fault of defamation lies with the publisher who actually published them, not the sponsor of them.

Walusimbi said that because the publishers were not sued, the case showed no basis of action for defamation, since a cause of action for malicious falsehood may only be brought against the publisher.

Rajiv’s attorney requested that the counterclaim be rejected since it revealed no cause of action against his client.

DFCU’s Argument

DFCU’s attorneys, Kalenge, Bwanika, Ssawa & Co. Advocates, presented documents in court as a collection of specific misleading material they claim Rajiv published or republished to the damage of DFCU.

The attorneys argued that the publishing and re-publication were sent from Rajiv’s personal cell phone number +256 772 777773. The publications propagated erroneous information that William Ssekabembe, DFCU’s Executive Director, had quit and that the company was having financial difficulty and was closing down.

The bank’s counsels stated that Rajiv made his phone number public when he published and republished the damaging articles about the bank, and that the bank’s letter to Rajiv was solely a direct consequence of Rajiv’s activities.

“The articles were published and republished with malicious intent to cause a run on the Defendant Bank,” argued DFCU’s lawyers.

DFCU also produced evidence that “people were urging one other to withdraw their money from the bank as it was experiencing a liquidity problem, a matter that developed as a result of the Plaintiff’s publishing and re-publication of the false and damaging publications” (Rajiv).

The bank stated that as a company, it has the right to “conduct the Banking business in which it has invested its resources to the point that it is now a major bank in Uganda.”

It has economic rights under Article 40(2) of the Ugandan Constitution, and this right was breached when Rajiv began publishing and republishing harmful lies about the bank to its damage.

The attorneys claimed that there was no legal basis for publishing stories other than bad faith. According to the bank’s attorneys, Rajiv planned to use illegal means to disrupt the banking institution and the whole national economic sector.

Based on this submission, the bank stated that it had a cause against Rajiv.


In her judgement dated February 4, Justice Esta Nambayo stated that a DFCU lawyer conveyed the ‘intention to sue over WhatsApp. Rajiv reacted by sharing his lawyer Nelson Walusimbi’s phone number.

“The telephone communication between DW1 (DFCU lawyer) and Rajiv was tendered in court as Exhibit D4. In my view, this confirms that the plaintiff (Rajiv) allowed the bank to use the availed telephone contact as his address of service and, the plaintiff had used the same telephone number to communicate the messages complained of by the defendant; I find that it was only proper and right for the defendant to reply to him using the same phone line,” the judge ruled.

“I, therefore, find that the defendant (DFCU) is not liable for breach of the banker-customer relationship obligation of confidentiality since the plaintiff himself had already used the impugned telephone number to share the information that the bank found offensive, on Social media and he allowed the DW1 to use the same line when DW1 contacted him enquiring on where to deliver the letter, (Exh.P.1) to him. Therefore, the defendant was not in breach of the plaintiff’s right of privacy.”


On whether the bank is liable for defamation against Rajiv, Nambayo cited Ramaswamy Iyer’s, The Law of Torts, 6th edition, page 210, which states that the term “publisher” includes his servant or agent who is concerned with the contents of the publication, as well as the person, firm, or corporate body responsible for making a work available to the public.

“In this case, information about the Defendant’s (DFCU) alleged precarious situation was being sent to the public from the Plaintiff’s (Rajiv’s) telephone No. +256772777773 which qualifies the plaintiff to be the publisher of the information by virtue of his sending the information to the public,” ruled Justice Nambayo.

Nambayo cited evidence presented in court in the form of warnings to individuals who had money with the DFCU to withdraw it immediately because the bank was in a severe liquidity issue, supporting DFCU’s claim that the information was detrimental and caused a bank run.

She also cited DFCU’s public statement, which stated, ‘these allegations that are varied in nature, seek to cause unnecessary concern among customers by casting a shadow of uncertainty on the future of DFCU and as such should be treated with the utmost contempt they deserve.”

The judge ruled: “The above confirms that there was a run on the bank. In view of the above, it is my finding that the information that the Plaintiff (Rajiv) published about the defendant (bank) was defamatory and malicious and as a result of the malicious publications, the bank suffered injury and loss.”

The decision will create a thrilling precedent. Anyone who uses their WhatsApp number to send defamatory or harmful messages to other persons or WhatsApp groups may now face legal consequences.

The bank claimed that Rajiv’s “injurious and malicious publication” contents cost its customers and revenue.

“Evidence shows that the Plaintiff (Rajiv) ran to court after the defendant (DFCU) issued him with a notice before legal action, which means that the bank was aggrieved by Rajiv’s conduct even before the matter came to court. I find no reason to deny the bank its costs. In the result, therefore, I hereby dismiss the main suit with costs.”

Rajiv was found “liable for defaming DFCU Bank” and “liable for disseminating harmful and malicious lies against Defendant (DFCU),” according to Justice Nambayo.

“A permanent injunction is hereby issued barring the Plaintiff (Rajiv) from further defaming and publishing injurious and malicious falsehoods against DFCU Bank,” ruled Justice Nambayo.


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