UNBS workers remanded over attempt to extort Shs800m from Lato Milk maker

The Nakawa Chief Magistrate’s Court on Wednesday remanded two employees of the Uganda National Bureau of Standards (UNBS) and an accomplice to Sentema Government Prison after discovering that they were planning to extort Shs800 million from Pearl Dairy Limited, the manufacturer of Lato Milk.

According to the State House Anti-Corruption Unit, which led the operation that arrested them, Derrick Konde, a UNBS Inspector and Stephen Kiganda, a UNBS driver, together with their “accomplice” Solomon Abaho “threatened to accuse the management of Pearl Dairy Farms of committing a misdemeanor to wit sale of milk which has been rendered unfit to human consumption an offence contrary to Section 173 of the Penal Code Act.”

“Working together with Uganda Police and three suspects have today been charged with attempts at extortion by threats to the management of Pearl Dairy Limited,” the Unit said in a Wednesday statement.

The trio and others who are still at large will stay in the prison until July 30 when they’ll return for hearing of their bail application.

Appearing before Grade One Magistrate Fiona Angura, the accused denied the charges.

They were charged under section 291 (1) b of the Penal Code Act. The offence attracts a maximum sentence of 14-years imprisonment, on conviction.

Prosecution led by Christine Apolot alleges that the trio and others still at large, on May 28, 2020, with intent to extort money, threatened to accuse the management of Pearl Dairy Farms Limited Banda outlet in Nakawa Division, Kampala district of selling lato milk, which is noxious or is in a state unfit for human consumption.

UNBS promised to respond to our email requests for comment but hadn’t made good on the promise by the time of publication.

Lato Milk was recently accused of repackaging expired milk products and reintroducing them to the market.

When we contacted them for comment, they said competitors were trying to damage its brand.

Reports indicate that the most repackaged products are yoghurt in 250ml and 125ml packages and UHT whole milk in 500ml packs.

A video shared by a whisteblower showed some of the products manufactured on Dec. 9, 2019 and were to expire on June 6, 2020. But the expiration labels on the boxes, after repackaging, show the milk was manufactured on Feb 2, 2020 and will expire August 3.

Speaking to Bhasker Kotecha, a shareholder of Pearl Dairy, which manufactures Lato Milk, he denied the allegations, claiming it’s a campaign launched by competitors.

“Those are allegations and we are trying to resolve the matter,” he said in earlier phone interview. “It’s just sabotage from competitors.”

Though Lato Milk is manufactured from Mbarara, the reports say the expired milk is repackaged from a warehouse in Banda, Nakawa division, Kampala. Kotecha says it’s not possible to do the repackaging from a warehouse.

“To repackage milk in the warehouse like they claim… it requires machines, which are not available at the warehouse.”

Pearl Dairy Farms Limited, which manufactures Lato Milk, is found in Biharwe along the Masaka–Mbarara Road and it was founded in 2012.

The company, whose factory sits on 15 acres of land, has a milk processing capacity of 500,000 liters of milk a day, according to a document obtained by this website.

Marketed under the brand Lato, it produces various types of dairy products, namely: Butter Oil, Ghee, Skimmed Milk Powder, Full Cream Milk Powder, to mention just a few.

The company, which also has a unit in Kenya, says it has more than 1,200 employees in Uganda and 1,800 across East Africa.

The raw milk it uses is sourced from over 10,000 smallholder farmers in Uganda.

It sells products across 10 countries in Africa and Asia, according to foodbusinessafrica.com.

There are other milk processing companies in Uganda — for instance, Jesa Farm Dairy, Fresh Dairy, GBK Dairy Products — and they mostly sell their products to EAC, COMESA countries, SADC, UAE, Nigeria, Syria, Egypt, Omen, USA, Nepal & Bangladesh.

They mainly UHT milk, ghee, casein, whey proteins, and butter oil.

Pearl is jointly owned by Bhasker Kotecha and Anand Kapoor families, and Rise Fund, which acquired a 34% stake in 2019.

Contacted for comment, Uganda National Bureau of Standards (UNBS) asked us to share questions but had not responded by the time of publication.

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