Mr Michael Nyinaku, Chief Executive Officer (CEO) of the Beige Bank Limited, which is currently in receivership, has challenged the basis upon which KMPG Officer, Julius Ayivor, claims that the Government of Ghana used the taxpayers’ money to settle affected depositors of the bank.
Mr Ayivor is the Attorney-General’s (A-G) first Prosecution Witness (PW1) and a Chartered Accountant on secondment to the Receiver of the Beige Capital.
However, Mr. Nyinaku, speaking through his Counsel, Theodosius Sory, challenged the Receiver representative’s authority, as he is not a public officer to make the claim, which includes a GH¢320 million transferred from BCAM to an alleged fictitious account, over GH¢104 million transferred from Beige Bank to Beige Group and GH¢20 million placed by Tobinco Pharmaceutical Limited, as a fixed deposit with Beige Bank and diverted to Beige Group, which all remain unpaid.
According to Mr. Sorry, those claims offend Sections 60 and 61 of the Evidence Act, since the witness did not lay the foundation of personal knowledge, adding that PW1 was only appointed to work with the Receiver and he is not a government official or the bridge institution, Consolidated Bank.
Mr. Sory said this, while objecting to four paragraphs of Mr. Ayivor’s witness statement at the Economic and Financial Division of the Accra High Court, presided over by Court of Appeal Judge, Justice Afia Serwaa Asare Botwe on Friday, February 3, 2023.
The prosecution, led by Chief State Attorney (CSA), Evelyn Keelson, challenged the objections raised by Counsel, arguing that the witness has personal knowledge of all the paragraphs being questioned.
She stated that the witness indicated that he was a leading member of the Receiver and had reviewed the company’s profile, and therefore, does not need to produce anything to support his claims.
After listening to the Counsel and Chief State Attorney, the court overruled the objection, on the grounds that the witness has worked with the Receiver.
The Accused’s plea on the 43 charges of stealing, fraudulent breach of trust and money laundering was retaken.
He once again pleaded not guilty to all the counts and the court maintained his bail conditions of GH¢200 million with three sureties, two to be justified by landed property worth the bail bond.
The properties are to be valued by either the Land Valuation Division or the Architecture and Engineering Services Limited.
The accused was ordered to report to the case investigator every Monday and Friday at 9 a.m. as well as deposit his passport at the court registry.
PW1 evidence-in-chief
My name is Julius Ayivor. I’m a chartered accountant by profession. I have been on secondment from KPMG to the office of the Receiver for Beige Bank, since August 2018 and a member of the Receiver’s team.
On 1st August 2018, the banking license of the Beige Bank Limited (Beige Bank or “the Bank”) was revoked and the Bank was placed in receivership.
NiiAmanorDodoo was appointed ty Bank of Ghana (BoG) as the Receiver of the Bank on the same day.
Following the revocation of Beige Bank‘s operating license and the appointment of Nii Amanor Dodoo, as Receiver for the Bank, the Receiver assembled a team to perform various reviews of the financial and other records of the Bank.
I was a leading member of the team assembled by the Receiver to review the financial and other records of Beige Bank in the custody of the Receiver.
The team reviewed various records of the Bank including Beige Bank’s financial statements, trial balance, general ledger accounts, bank statements, payment vouchers, memos, invoices, e-mail correspondence, letters and minutes of meetings of the Board, Committees and management, amongst others.
The team also reviewed the profile of Beige Bank and other companies related to Beige Bank through common shareholding and common direactorship, extracted from the online portal of the Registrar General’s Department and other sources.
The reviews conducted by the team identified a number of transactions that were suspicious and unusual in nature. The suspicious and unusual items involved siphoning funds that had been deposited by customers with the Bank by the accused person to himself and companies related to him, which have to date not been paid back to the Bank. This caused Government of Ghana to pay out a total of GH¢2.1 billion out of taxpayers’ money to settle depositors that had placed monies with Beige Bank.
In August 2020, based on a request from the Office of the Attorney-General and Ministry of Justice, a report on unusual and suspicious transactions was compiled from the records and underlying supporting documents of Beige Bank including payment vouchers, bank statements and email correspondence, which were used to prepare the report and submitted to the Office of the Attorney-General and Ministry of Justice.
The report, which was compiled by the team, was signed by the Receiver. I shall tender in evidence the report submitted to the Office of the Attorney General and Ministry of Justice together with Appendices A-C of the said report.
These suspicious and unusual transactions included the following:
- a) The transfer of customer deposits to a fictitious account opened in the name of First Africa Savings and Loans Limited (FASL)
- b) The transfer of customer deposits lodged with Beige Bank to Beige Capital Asset Management Limited (DCAM) without the customers’ consent
- c) The transfer of customer deposits lodged with Beige Bank to the Beige Group Limited (Beige Group) without the customers’ consent
- d) The transfer of Beige Bank’s funds to the accused person, a shareholder and the Managing Director (MD) of the Bank and companies related to him.
The Beige Group Limited is a limited liability company wholly owned by the accused. The company was set up as a holding company and the of its business, as described on the company’s profile extracted from the Registrar General’s online portal is neither a managerial assistance to Beige Bank, BCAM, Legacy Pensions Trust, Beige Assur, Unique Life and Beige Care.
The company is neither licensed by Bank of Ghana to accept deposits nor is it licenced by the Securities and Exchange Commission (SEC) to engage in the business of fund management. The accused person and two other persons serve as directors of the company. I wish to tender in evidence a company profile extracted from the Registrar General’s online portal evidencing the ownership statue of the Beige Group Limited and its directors.
BCAM is a limited liability company wholly owned by the Beige Group limited. The accused person also served as a director of the company. I wish to tender in evidence a company profile from the Registrar General’s online portal evidencing the ownership status of BCAM and its directors.
The principal shareholders of Beige Bank at the time it was placed in receivership were the Beige Group Limited, 88.6% shareholding, and the accused person, 11.2%. Thus, the accused person held direct and indirect shareholding of 99.8% in Beige Bank with the remaining 0 2% held by other individuals. I wish to tender in evidence the company profile of Beige Bank extracted from the Registrar General’s online Portal evidencing the ownership status of Beige Bank.
‘The accused person was at all material times the Managing Director and Chief Executive Officer of Beige Bank until it was placed in receivership.
I wish to explain in detail, in the foregoing paragraphs, the suspicious and unusual transactions uncovered by the team through the review of the records of Beige Bank after its license was revoked
A fictitious account number 0381520414122/100005825274 was opened in the name of a customer of Beige Bank, First Africa Savings and Loans Limited (FASL), without FASL management’s knowledge and consent. I would like to explain how the fictitious account was opened.
From discussions with officials of FASL, the accused person through Beige Group expressed interest in investing in FASL’s equity share following, which Beige Group made a deposit for the acquisition of FASL’s shares and requested FASL to open and maintain a bank account with Beige Bank.
- By a letter dated February 12, 2018, FASL requested a change to the list of signatories for its regular bank account numbered 0381520414 121/ 100005144277 held with Beige Bank and named Vanessa AkoriaAtsu and Yvonne Phillips, officials of Beige Group, as Group A signatories, and Gifty Affenyi Dadsie and Kwabena Osei-Bonsu, officiate of FAGL, as Group B signatories with the following mandate: “two signatories with one from each group” signing cheques and other banking documents and correspondence with respect to the operation of the account. I wish to tender in evidence the letter from FASL requesting the change to signatories for its regular account with Beige Bank and copies of the updated mandate to the account.
On March 14, 2018, Vanessa Akorfa Atsu sent an e-mail to Susannah Philips, an Operations Officer at Beige Bank, instructing an “additional” account to be opened in the name of FASL. This request came across to the team as unusual because no resolution by the board of FASL authorising an additional account to be opened was attached and no official of FASL was kept in copy of this e-mail.
On the same day, March 14, 2018, Susannah Philips confirmed in an e-mail to Vanessa Akorfa Atsu, copying Augustine Yiedom Boakye, Chief Finance Officer (CFO) of Beige Group, Yvonne Philips, Executive Support Head at Beige Group, and William Kaletel fan official of Beige Croup, that the new account 03815204 14124/ 100005825274.
The account was referred to by ‘Yvonne Phillips, in an e-mail to Susannah Philips dated March 14, 2018, as the “newly created account (FASL control account)” Vanessa Akorfa Atsu later confirmed the names of signatories to the new account as herself and Yvonne Phillips. No official of FASL was nominated as a signatory to the fictitious account.
The accused person was kept in ‘copy of the e-mail correspondence of March 14, 2018 after the fictitious account was confirmed to have been opened. I wish to tender in evidence the e-mail from Vanessa Akorfa Atsu requesting Susannah Philips to open the second account in the name of FASL.
The e-mail from Susannah Philips confirming that account number 03815204 14122/ 100005825274 had been opened in the name of FASL, the e-mail from Vanessa Akorfa Atsu confirming signatories to the account and a copy of the mandate for the account.
No Board resolution from FASL was attached to the instruction to open the fictitious account. A Board resolution from FASL was, however amongst documents found in support of the regular account that FASL opened with Beige Bank, i.e. account numbered 03815204 14121/ 100005144277. I wish to tender in evidence excerpts of minutes of the Board of Directors of FASL held on October 26, 2017 which authorised FASLS regular bank account numbered 03815204 14122 / 1000051 44277 to be opened.
Following the opening of the fictitious account described above, fixed deposits of some customers of Beige Bank totalling GH¢320million were transferred from the accounts of the customers, without their authorisation and consent, to the bank account of BCAM held with Beige Bank numbered 100003481365, The fixed deposits were later transferred from the BCAM account into the fictitious account that had been opened in the name of FASL, i.e. account number 0361520414122/ 100005625274.
Management of FASL confirmed in meetings that were held with the team, after Beige Bank had been placed in receivership, that FASL had only one account, 03815204 14121 / 100005144277, with Beige Bank, that was opened in November 2017, which, as at August 1, 2018, had a balance of about GH¢12milion. Management of FASL denied knowledge of the existence of the fictitious account 0381520414122/ 100005825274 that was opened on the instructions of Vanessa Akorfa Atsu.
The accused person, subsequently, approved the transfer of a total of GH¢21.12milion to be siphoned out of the fictitious FASL account to the accounts of two individuals and10 companies held with Beige Bank, nine of, which are related to the accused person, leaving a balance of GH¢299 million on the account as at August 1, 2018 A list of the companies and individuals that the amounts siphoned were paid to are set out below:
I wish to tender in evidence the bank statements of BCAM and a sample of 12 customers from whose accounts funds for fixed deposits were transferred into BCAM’s account, 100003481365, bank statement for the fictitious account opened in the name of FASL, 03815204 1 4122/ 100005825274, into which the funds from BCAM were lodged, the internal memos approved by the accused person based on which the transfers were made out of the fictitious FASL account to entities related to the accused person and transfer letters instructing the amounts to be transferred to the accounts of entities related to the accused person.
I will also tender in evidence company profile of 10 entities listed above extracted from the Register General’s online portal evidencing their ownerships status.
As will be realised the exhibits, Emmanuel Richard Ofori placed two fixed deposit investments of GH¢2 million each with Beige Bank on September 8, 2017 and September19, 2017, with transaction reference numbers MM1705130776 and MN1726230512. The deposits had maturity dates of March 9, 2018 and March 1, 2018 respectively.
Proceeds of the principal of the two investments totalling GH¢4 million, which were to be rolled over on maturity, were siphoned out from Emmanuel Richard Ofori’s account on March 16, 2018 through transaction reference number FT1807573990 to BCAM’s account,100003481365, with the Bank.
Various amounts that were also meant to have been rolled over for other customers were similarly siphoned out of the customers’ accounts periodically into BCAMs account with Beige Bank. Out of the customers’ deposit transferred from Beige Bank the BCAM’s account, a total of GH¢320 million (including Emmanuel Richard Ofori’s fixed deposit of GH¢4 million) were transferred into the fictitious FASL account.
After Beige Bank was placed in Receivership, customer deposit accounts were transferred to Consolidated Bank Ghana Limited (CBG) as part of Government’s arrangements to pay customers. Access to customers’ funds was granted after customer accounts had been duly validated. On August 8, 2018, a transfer request letter, was received by a staff of the CBG, Patrick Ebo Kittoe, to transfer an amount of GH¢38,101,095 89 from the fictitious FASL account, 03815204 14129/ 100005825274 to BCAMs account, 0011078031121.
The transfer request letter was signed by two signatories with no names, but subsequent investigations by the team on the letter revealed that the transfer request was signed by Augustine Yiadom-Boakye, the CFO of the Beige Group Limited, and Yvonne Phillips, the Executive Support Heed at the Beige Group Limited.
Upon receipt of the request, management of FASL was contacted by CBG to verify the authenticity of the transfer request. It then became obvious that management of FASL had no knowledge of the said account, i,e. account number 0381520414122/ 100008825274.
A meeting was, therefore, convened by CBG at their Dzorwulu offices on August 15, 2018 at 2pm for all relevant parties to the transaction, including the Receiver to discuss the transfer request. It was confirmed at that meeting that the second FASL account that had been opened was fictitious and the transfer request in question was fake and an attempt to siphon additional funds out of the fictitious account for the benefit of BCAM and the accused person.
The purported request from FASI was, therefore, declined and the matter was reported to the police on August24 2018. Earlier transfers that had been made out of the fictitious account were also confirmed to have been fraudulently done. I wish to tender in evidence the transfer request signed by Augustine Yiadom-Boakye and Yvonne Philips, dated August 8, 2018.
Various sums of Beige Bank’s funds, mainly made up of customer deposits, were siphoned out on the instructions of the accused person to himself, companies ultimately owned by him and other third parties.
These payments, amounting to GH¢281, 852,953.37, were recorded in the following four other assets general ledger accounts of Beige Bank, Directors Account, Shareholders Account, Beige Group Account, and Prepayments, Project Works Account. I have set out in the table below a total of some of the payments made and recorded in each of these accounts:
There was no evidence that the accused person of any of the recipients provided any consideration to Beige Bank in exchange for these payments and the total amount has to date not been refunded by the accused person or any of the other recipients to Beige Bank.
I wish to tender in evidence a summery of the transactions, prepared by the team, that make up the total amount of GH¢281,882,953 37, siphoned out of Beige Bank by the accused person and recorded in the Directors Account, Shareholders Account, Beige Group Account and Prepayments: Project Works Account.
I wish to explain these payments using the following four examples totalling GH¢63, 5 17,471.25:
- a) In an e-mail dated August 8, 2017 from Seyram Agbeve, an officer of Beige Group, to Stephen Dush Agyemang copied to the accused person, Dawda Hafisdeen, Yvonne Phillips and Jeffrey Lamptey, a request to transfer an amount of GH¢500,000 into the accused person’s Stanbic Bank Ghana Limited account, a/c number 9040009031149, was made on the accused person’s instructions.
A letter dated August 10, 2017, signed by the accused person, and addressed to the East Legon branch of Stanbic Bank then requested the transfer of GH¢500,000 from Beige Bank’s accounts held a Stanbic Bank to the accused person’s personal account number 9040003031149 held at the Spintex Road branch of Stanbic Bank.
The transfer was made on August 18, 2017. I wish to tender in evidence the e-mail request from Seyram Agbeve, the letter to Stanbic Bank instructing the transfer of GH¢500,000 to the accused person’s personal account and the Stanbic account statement of Beige Bank evidencing movement of the funds.
- b) David Sogbodjor requested approval from the accused person for US$100,000 to be transferred to the accused person’s office from the Central Vault Unit, in an e-mail dated May 23, 2017, copied to Dawda Hafiedeen, Christian Ekow Aidoo and Stephen Agyemang. The accused Person approved this request in an e-mail response the same day.
Based on the accused person’s approval, a memo dated May 23, 2017, was prepared by Anne Selina Kutin of the Cash Management Unit (CMU) to the CFO’s Office with the subject “Specie evacuation,” which was authorised by Christian Ekow Aidoo. Following this authorisation, GH¢450,000, which was equivalent to US$100,000 at GH¢4.5 US$1 rate, was sent in cash from the vault to the accused person’s office. This amount was received by Seyram Agbeve on the accused person’s behalf. I wish to tender in evidence the e-mail approvals by the accused person dated May 23, 2017 and the memo dated May 3, 2017.
- c) Stephen Duah Agyemang requested approval from the accused person for an amount of US$200,000 to be released to the accused person’s office in another e-mail to the accused person dated July 17, 2017, copied to Dawda Hafisdeen, Christian Ekow Aidoo, and Seyram Agbeve. The accused person approved the request in an e-mail response the same day.
Based on the accused person’s approval, a memo dated July 17, 2017 to the CFO’s Office with the subject Specie evacuation was prepared by Regan Mensah Gogo of the Cash Management Unit and authorised by Anne Selina Kutin following, which an amount of GH¢900,000 (US$200,000 at GH¢4.5/US1) was sent to the accused person’s office.
This amount was received by Raphael Zilevu on the accused person’s behalf. I wish to tender in evidence the e-mail approvals by the accused person dated July 17, 2017, and the memo dated July 17, 2017.
- d) The following investments held by Beige Bank with the listed institutions totalling GH¢61,667,471.28 were transferred to Beige Group on the instructions of the accused person:
In an e-mail dated August 17, 2017, David Sogbodjor, the Finance Manager of Beige Bank, requested approval from the accused person for the amount of GH¢16,623,840.25 being total investments that Beige Bank held with Essien Swiss, Express Savings and Loans, Invest Eye and Accent Financial Services to be transferred to Beige Group as per the accused person’s directive.In the same e-mail, David Sogbodjor proposed that Beige Bank’s placements held with Royal Bank, uniBank, Stanbic Bank and U-Life totalling GH¢45,043,631. 00 should also be moved to Beige Group. The accused person approved the transfer in response to David Sogbodjor’s e-mail dated August 17, 2017.
Accordingly, Beige Bank’s investments totalling GH¢61,667,471. 25 were transferred to Beige Group. The total amounts transferred have to date not been refunded by Beige Group to Beige Bank. I wish to tender in evidence the e-mail correspondence between David Sogbodjor and the accused person which served as the basis for the transfers.
Apart from the examples cited in documents covering the remaining transactions totalling GH¢218,365,482 12 have been attached to Exhibit…
Over 10,000 deposits that various customers had placed with Beige Bank were transferred from their accounts with Beige Bank to BCAM, on the instructions of the accused person without the customers’ consent.
As at August 1, 2018, the total outstanding principal balance of customer deposits that had been transferred to BCAM amounted to GH¢448,636,210. 21, made up of transfers of GH¢23,610,202. 31 in 2017, and GH¢425,026,007. 90 in 2018.
It was out of these transfers made to BCAM that BCAM transferred the GH¢320million into the fictitious FASL account, discussed in paragraphs above. The amount that was utilised by BCAM out of these transfers still remain unpaid and Government of Ghana had to pay these depositors through the bailout package.
The bank statements of sample of 12 of the affected customers evidencing the transfers from their accounts to BCAM are included in the Exhibits tendered. I also wish to tender in evidence the list of customers whose deposits were transferred to BCAM, a sample e-mail from the accused person, authorising the transfer of customer deposits without the customers’ consent, letters from two customers indicating that the transfers were made without their consent, the accused person response to an enquiry from the Receiver, in which he confirmed that such transfers of customer deposits were generally and routinely made from Beige Bank to BCAM and Beige Group.
Other deposits placed by 23 customers between 2016 and 2018, held in 35 deposit accounts amounting to GH¢141,042,348 92, i.e. GH¢369,516 in 2016, GH¢30,200,000 in 2017, and GH¢104,972,832 92 in 2018, were also transferred from Beige Bank to Beige Group, on the instructions of the accused person.
The amounts still remain unpaid by Beige Group and Government of Ghana had to pay these depositors through a bailout package. I wish to tender in evidence the list of customers whose deposits were transferred to Beige Group.
I wish to explain these suspicious transfers with two examples involving deposits placed by Tobinco Pharmaceuticals Limited and Ernest and Barbs Real Estate Developers Ltd with Beige Bank as follows:
- a) An amount of GH¢20million, placed by Tobinco as fixed deposit with Beige Bank evidenced by a completed investment advice form dated March 22, 2018, was diverted into the bank account of the Beige Group on the instructions of the accused person. After the GH¢20 million was deposited by Tobinco into Beige Bank’s account with Ecobank on March 22, 2018, the Deputy MD of Beige Benk, Charles Odonkor, requested the Financial Controller, DawdaHafiedeen, in an e-mail dated March 22, 2018, with the accused pereon and two (2) other members of siafl of the Bank in copy, to seck directions from the accused person, on how the investment should be “handled”.
In an e-mail response from the accused person that same day, the accused person instructed the GH¢20million to be credited to Tobinco’s account with Bege Bank and subsequently transfer the deposit to Beige Group’s control account.
Based on that instruction, Tobinco’s deposit of GH¢20million was transferred from Beige Bank to BCAM’s account,1000034812365, on March 22, 2018, and the same amount transferred from BCAM’s account, 100003481365, to Beige Group’s account, 100002841422, on March 23, 2018.
This effectively caused the transfer of Tobinco’s deposit from Beige Bank to Beige Group. Following the placement of Beige Bank in receivership, Tobinco requested repayment of the GH¢20 million deposit that they had placed with Beige Bank but as no such balance reflected in Beige Bank’s books, the request was declined. Tobinco categorically denied authorising the transfer of their fixed deposit to Beige Group.
Further work done confirmed this fixed deposit as part of the 35 fixed deposits that were transferred from Beige Bank to Beige Group on the instructions of the accused person, without the knowledge of the depositors.
The fixed deposits transferred, including Tobinco’s fixed deposit investment, had to be paid back to the affected customers, as part of the Government bailout of Beige Bank despite the fact that these amounts had been transferred to Beige Group and the deposits transferred to Beige Group have not been paid beck to Beige Bank.
I wish to tender in evidence the e-mail approvals by the accused person based on which the investment of Tobinco was transferred from Beige Bank to Beige Group, the bank statements of Tobinco, BCAM and Beige Group, which confirmed the transfers made and correspondence from Tobinco on this matter.
- b) By In the second example, three fixed deposits of Ernest and Barbs totalling GH¢16,755,332. 92 were transferred from Beige Bank to Beige Group on the instructions of the accused person without the consent of Ernest and Barbs, the customer.
The first was a fixed deposit of GH¢612,300,000 placed by Ernest and Barbs with Beige Bank, confirmed by Beige Bank in a letter dated August 9, 2016, as a deposit placed at an interest rate of 49.5 percent (%) per annum with a maturity date of August 5, 2018. This deposit was transferred to Beige Group on January 15, 2018, without the customer’s consent.
The second fixed deposit of GH¢2,755,332. 92 placed by Ernest and Barbs with Beige Bank was transferred from Beige Bank to Beige Group on March 27, 2018, after the customer requested a roll-over of this investment at a rate of 36. 5%, when the investment matured on March 2, 2018.
In an e-mail response regarding this roll-over, dated March 23, 2018, the accused person instructed the fixed deposit to be passed on to Beige Group as Beige Bank could not deal with the investment of that rate. This deposit was accordingly transferred to Beige Group and resulted in the exclusion of this deposit by Ernest and Barbs from the list of deposits placed with Beige Bank.
The accused person reconfirmed the transfer of this investment to Beige Group in another e-mail dated March 28, 2018, A third fixed deposit of GH¢1,700,000 placed by Ernest and Barbs with Beige Bank was transferred to Beige Group on July 12, 2018, after Yvonne Phillips, Executive Support Head at Beige Group, approved this transfer in an e-mail dated July 11, 2018, on behalf of the accused person.
This approval was in response to an e-mail by an official of Beige Bank on July 11, 2018, to the accused person seeking approval for the transfer of this investment to Beige Group when it matured and was due to be rolled-over for 24 months of an interest rate of 36% per annum, ‘The three deposit, totalling GH¢16,758,322.92, were transferred from Ernest and Barbs’ account number, 100002944396, to Beige Group’s account number, 100002841422.
This resulted in the exclusion of Ernest end Barbs’ deposits from the list of deposits placed with Beige Bank. I wish to tender in evidence e-mail approvals by and on behalf of the accused person based on, which the investments of Ernest and Barbs were moved from Beige Bank to Beige Croup, the account statements of Ernest and Barba and Beige Group confirming the transfers, and correspondence with Ernest and Barbs on this matter.
