The Founder and Chief Executive Officer (CEO) of defunct Beige Bank Group, Michael Nyineku, says it was not correct for Julius Ayivor, a lead team member of the Receiver, to assume that the GH¢4.5 million that was paid to one of the bank’s customers was paid out of the Government of Ghana (GoG) bailout package.
He said the amount was paid by Beige Capital Assets Management (BCAM) and not the Consolidated Bank Ghana (CBG) as Mr. Ayivor wanted the trial court to believe.
Speaking through his Counsel, Thaddeus Sory, the Economic and Financial Division of the Accra High Court, presided over by Her Ladyship Afia Serwaa Asare Botwe, was told that BCAM had several bank accounts and assets, which made it capable of meeting that obligation to its customer.
According to Mr. Sory, BCAM, even at the revocation of Beige Bank, was a growing concern and still in business.
Mr. Sory said it was evident on a document before the court that BCAM paid cash to the customer in question, and it could not be that CBG would make a cash deposit into an account held by itself.
He told the court last Friday that the BCAM had as much as GH¢200 million in its First Africa Saving and Loans account.
The counsel further argued that it was not enough for the Receiver to base its claim on just one account statement of the BCAM with the Beige Bank.
Mr. Ayivor, testifying as the first Prosecution Witness (PW1), maintained that the GH¢4 million was money paid to one William Addo out of the Government of Ghana bailout package.
PW1 said the BCAM, as at the time of revocation of the Beige Bank, did not have enough funds in its account to meet that obligation.
He also said the GH¢200 million was customers’ funds that were siphoned from their accounts with Beige Bank to BCAM, and then to a fictitious account with First Africa Saving and Loans.
Apology
At the last two adjourned dates, the Counsel could not attend court, so the judge requested that Mr. Sory apologise.
Counsel: I apologise sincerely for my absence.
Court: Don’t do that again, if you have a difference of opinion show up and deal with it along the line.
Sory: I apologise unreservedly.
Further cross examination of PW1
Q: If you look at Exhibit H3, from the 3rd of August 2018 to the 10th of December 2018, you’ll find a number of MM reference transactions which you call money market transactions, which are credited and also debited to the account of Ideal Finance, is that correct?
A: That is so my lady.
Q: Now, on the 24th of February 2023, you testified that all payments made to Ideal Finance from the 3rd of August 2018 to the 6th of December 2018, were made out of the government’s bailout package, is that correct?
A: That is so my lady.
Q: In response to a question that I asked you whether CBG keeps a different statement of account between itself and Ideal Finance to enable us verify the payments made from this bailout package to Ideal Finance, you said yes, is that correct?
A: My lady, I said CBG keeps records of all payments that were made to Ideal Finance between the referenced period out of the government’s bailout package.
Q: On the basis of this answer, the court ordered you to make the records available, is that correct and you made them available?
A: That is so.
Q: Are these the documents you sent to us?
A: These are not the documents in response to the court order issued on the last two adjourned dates. These documents are in response to an earlier order made by the court that requested CBG’s records of payments made to all the 10,000 plus customers whose funds were siphoned out of Beige Bank on the instructions of the accused person.
The record of the payments made to Ideal Finance between August 3, 2018 and December 6, 2018, was provided to the A-G’s Department, which were just two sheets of paper.
Q: So is Ideal Finance one of the customers whose funds were allegedly siphoned from the bank in accordance to the accused person’s instructions?
A: That is so my lady. But not all the credit on Ideal Finance account between August 3, 2018 and December 6, 2018, relate to the GH¢3 million that was siphoned out of Ideal Finance’s account on 16th April 2018.
My lady, Ideal Finance had several fixed deposit investments with Beige Bank with different MM reference numbers; those that remained with Beige Bank as legitimate fixed deposit investments were also paid out of the Government of Ghana’s bailout package.
And so not only the GH¢3 million that was siphoned was paid out of the Government of Ghana’s bailout package.
Q: So if you look at the bulk of documentation you have submitted to us, can you find out which of those transactions was paid out from the bailout package to Ideal?
A: My lady, these three documents only relate to payments made out of the government’s bailout package to the 10,000 plus customers, which includes Ideal Finance’s GH¢3 million that was siphoned out of the account. The other credits on Ideal Finance’s account, which do not relate to this GH¢3 million transaction in question are not included in this set of documents.
Q: Can you show me from those documents where the 3 million is located?
A: The software on this computer is not compatible with what I’m looking for; I can bring another laptop on Monday.
Court: You’re directed to bring a laptop on Monday.
Q: The court order on 24th of February, 2023, actually resulted in a question I asked you in relation to a payment on the 6th of December, 2018, is that correct?
A: Yes my lady.
Q: And it’s on that basis you supplied the documents you just returned to me, and also an email correspondence between yourself and Joseph C. and others. Is that correct?
A: My lady, it’s on the basis of the court order of 24th February 2023 that I furnished the A-G’s office with just this document. The other 3 sets of documents that I submitted to the A-G’s Department were submitted before the last court order.
Q: Now this document is also supposed to prove that the payment of 6th December 2018, reflected in Exhibit H3 was made from the Government of Ghana’s bailout, is that correct?
A: My lady, the swift advice that was attached to the email from Daniel A. Debrah of CBG to myself on March 2, 2023 is evidence that all the credits that were given to Ideal Finance between August 3, 2018 and December 6, 2018 were paid out of funds made available by the government.
Q: Now does CBG have different statements of account for the payments it makes out of the bailout package?
A: CBG keeps records of those payments that relate to the 10,000 plus customers. There is a statement which I have just submitted in those three documents for all other payments relating to other payment relations to legitimate fixed deposit placed by customers with the bank. CBG also keeps records of payments made to those customers out of the Government of Ghana bailout package in connection with those fixed deposits.
An example of that is this swift advice that supports the GH¢20.6 million Ideal Finance withdrew from their accounts on December 6, 2018. That amount was transferred by Ideal Finance to Bank of Africa.
Q: Ideal Finance is among the 10,000 customers CBG paid from the bailout package, is that correct?
A: That is so. Ideal Finance doesn’t have one fixed deposit, it had several fixed deposits. The only reason Ideal Finance is part of the 10,000 customers is because, as explained earlier, Ideal Finance’s GH¢3 million was siphoned out of their account on 16th April 2018.
Q: Are you suggesting that as a bank, CBG has no statement of account for all the customers it took over from Beige Bank, except for records on its relationship with those banks?
A: Exhibit H3 is also one of those records that support the credits that were made into Ideal Finance’s account; this Exhibit H3 is an extract from Beige Bank’s banking software, which is a record of the bank.
Q: Look at Exhibit H3; it’s a statement which includes a period during which the Receiver took over the bank?
A: That is so my lady.
Q: And it covers a period of close to 5 months – August to December?
A: That is so my lady. However, any transaction that you see on Ideal Finance’s account after August 1, 2018 could’ve occurred, yes, during the time the bank’s license was revoked and was placed in receivership. But those transactions were done under the purview of CBG.
Q: Exhibit H3 is on the letterhead of Beige Bank, is that correct?
A: That is so my lady, and that is because after August 1, when the license of the bank was revoked and it was placed on receivership, there was a validation and transition period where records of Beige Bank had to be transferred to CBG, and, my lady, you will note on the top right corner of the statement; you will see date 27th October 2018, on that date the former Beige Bank’s records hadn’t been fully transitioned into CBG’s system, that is why you still see Beige Bank on these statements. If you should request for these same accounts from CBG today, the titles will be CBG and it’ll have the same records,
Q: Mr. Ayivor, your witness statement to which Exhibit H3 is attached was made on 25th November 2022, so you could’ve attached the CBG statement of account in respect of Ideal Finance?
A: My lady, that is so; we could’ve attached Ideal Finance’s statement of account with the name Consolidate Bank written on it, but the transactions would still be the same.
Q: You realise that the three volumes of documents that you sent to us based on the court order covers the same period, but it was all on CBG letterheads?
A: That is so my lady, and that is because when the court made the order for us to produce evidence of payments that were made to the 10,000 plus customers, we had to reach out to CBG that keeps those records in their system as we speak for those records to be extracted for that purpose.
My lady, the Receiver also has a copy of all transactions relating to all customers of the former Beige Bank in a banking software called T24, so the Receiver, from time to time, can extract records of any customer from that software, and that record would show Beige Bank.
However, if CBG was engaged to extract the same set of records, which they also have in their system, the results of that extraction would show CBG; the translation will be the same. There will not be any difference. Albeit taking into consideration the cutoff date of the T24 system that the Receiver currently has.
Q: If the answer is correct, what it means is that anytime the court orders you to provide information, you don’t need to go back to CBG, but you just extract it from the T24 software. I’m putting it to you?
A: That’s not entirely so my lady. If the records relates to a historical period up to around August 2019, then the Receiver would have those records in that “legacy” T24 system. However, any record on any customer after that cutoff date would only reflect in the CBG T24 system.
Q: This, in effect, means that from Exhibit H3 then you could’ve, without writing to CBG, produced the same information that you’re now saying is reflected in the statement, is that correct?
A: My lady, as explained earlier, the GH¢20.6 million transaction on 6th December 2018 was done under the purview of CBG via the swift system. The receiver doesn’t maintain that kind of system, because Beige Bank is not a continuing bank as we speak. So any swift advice in support of that GH¢20.6 million can only be provided by CBG.
Q: So how come the swift advice you’ve made avoidable is reflected in the Beige Bank account when it was paid by CBG within the cutoff period?
A: There was a transition period when all the depositors of the former Beige Bank had to move to CBG, and that period started right from August 1, 2018 when the bank’s license was revoked. So, my lady, any transaction that reflects on any customer’s account from August 1, 2018 would’ve occurred under CBG’s purview.
Q: I’m putting it to you, since swift transfers are not maintained in the Receiver’s T24 software it ought not have reflected in the Receiver’s statement of account, in respect of Ideal Finance (Ex H3)?
A: From August 1, 2018 to the cutoff date of around Aug 2019, all transactions that reflect on the account of any customer occurred under the purview of CBG. On that date, a copy of that data was handed over to the Receiver, which I earlier termed the legacy of the T24 system. So, my lady, all transactions from August 1, 2018 to August 2019 would also be part of the Receiver’s records that reflect on that T24 system. I will check the cutoff date and furnish the court with that information on the next adjourned date.
Q: Exhibits H10 and H11. Exhibit H 11 is the statement of account of a certain William Addo?
A: That’s so my lady.
Q: Can you identify the transaction by why William Addo’s account was debited and correspondingly credited to the account of Beige Capital?
A: It’s a transaction dated March 5, 2018, with a reference number FT 1806480018 in an amount of GH¢4,518,575.34. And that the same transaction reflects on BCAM’s statement on the same day with the same reference number.
Q: What is this transaction detail?
A: It’s a fund transfer.
Q: And it is the same record you find in the BCAM transaction?
A: It’s the same record on BCAM’s account.
Q: If you look at June 7, there’s a sum of GH¢3,700,920.31?
A: That is so my lady.
Q: And it’s referenced MM, which you say means money market?
A: That is so my lady.
Q: And by money market, it’s an investment from your earlier testimony, is that correct?
A: It’s a fixed term deposit investment.
Q: But if you look at its clear description, it’s described as a repayment of principal?
A: That is so my lady.
Q: There is another credit on the same day, June 7, 2018, of the sum of GH¢553,617.12?
A: That’s so my lady.
Q: It’s also referenced MM, is that correct?
A: That is so my lady.
Q: But its description is payment of interest, is that correct?
A: That is so my lady.
Q: On June 12, 2018, there is a debit to the account of William Addo in the sum of GH¢4,254,507.43?
A: That’s so my lady.
Q: That is referenced FT?
A: That is so my lady. The reference number starts with FT.
Q: And by its description Mr. Addo had withdrawn the money by himself?
A: That is so my lady. Mr. Addo withdrew GH¢4,254,506.43 out of his account on June 12, 2018, and this withdrawal relates to a fixed terms deposit that William Addo placed with Beige Bank; that has a reference number MM 1734130874. That has nothing to do with the GH¢4,5185,750.34 that was siphoned out of his account on 5th March 2018 into BCAM’s account on the same date.
Q: The investment you describe as reference number MM 1734130874 is that which is dated June 7, 2018, is that correct?
A: That is so my lady. It’s the repayment of that investment by Beige Bank to Addo.
Q: Now, you also say that on the June 12, when William Addo’s account was debited with GH¢4,254,507.43, which is described as a funds withdrawal with a different reference number is a repayment of that investment of June 7, 2018 is that correct?
A: That’s so my lady. It is William Addo’s withdrawing that fixed term deposit which he had earlier placed with the bank and had matured. Evidenced by the GH¢3.7 million credit on his account on June 7, together with the interest of GH¢553.617.12 on that investment on the same June 7.
Q: So on June 12, when he withdrew his money, he had cleared his account and it came to 00, is that correct?
A: That is so my lady.
Q: On July 2018, there’s a credit to account of the same person in the sum of GH¢3254507.43 reference FT?
A: That is so my lady.
Q: You confirm FT to mean funds transfer?
A: That’s so my lady.
Q: Earlier on in your testimony, this money, you said William Addo withdrew over GH¢4 million on June 12, 2018, by the transaction reference FT, it was a repayment of his investment, is that correct?
A: That is so my lady. It’s a withdrawal by William Addo of his fixed term deposit placed with the Beige Bank that was credited to his account, together with interest on maturity on June 7, 2018.
Q: On July 9, the sum of over GH¢3 million was credited to his account also referenced FT, is that correct.
A: That’s so my lady.
Q: But if you look at the transaction of July 12, 2018, the amount credited to Addo’s account on July 9, 2018 is now debited to his account reference TT, right?
A: That is so my lady.
Q: On December 24, 208, the sum of GH¢4,518,575.34 was credited to his account referenced TT?
A: That is so my lady.
Q: And it is described as BCAM payment, is that correct?
A: That is so my lady. And that is the payment that was made to William Addo out of the Government of Ghana bailout package in connection with the same GH¢4,518,575.34 that was siphoned out of his account on March 5, 2018, with reference number prefixed FT into BCAM’s account on that same date.
Q: Now you realise that the reference numbers of the two dates, March 8, 2018 and December 24, 2018, which you say relate, are different. One is FT and the other TT, is that correct?
A: That is so my lady. And that is because the GH¢4,518,575.34 made to William Addo on 24th December, 2018 was a teller transaction, meaning this transaction was at a tellers tail. While the March 5, 2018, transaction was a funds transfer into BCAM’s account, which BCAM, subsequently appropriated, it was a repayment of that amount that was siphoned; a record of this 24 December transaction reflects on one of those three documents that counsel has and will have the same reference number.
Q: This bailout package from which CBG was paying customers of Beige, was some of it held in cash?
A: That’s so my lady.
Q: And so if you look at the transaction of December 24, 2018, it was a cash deposit through a teller with a voucher into Williams Addo’s account. Is that what you’re suggesting?
A: My lady, that’s not what I’m suggesting.
Q: When CBG begin paying these customers out of the Government of Ghana bailout package, the transaction occurred at a designated teller’s tail, that’s why you’ll see the reference number prefixed by TT?
A: Tellers generally deal with cash transactions, so if you walk to a bank and you meet a teller, you’ll mostly transact your business in cash, otherwise you could also transact that business on the banks online platform, in which the reference number will be FT.
So, my lady, it is not to say that CBG counted GH¢4.5 million physical cash and placed that in William Addo’s account. You’ll note that the GH¢4.5 million credit given to William Addo was what he himself got CBG to invest in a new fixed term deposit on 27th December 2018, evidenced by the reference number MM 1836100603, and described as new deposit.
Q: Do tellers receive cheques?
A: Yes.
Q: Are you saying if they receive cheque it’ll be captured cash; is that what you are suggesting?
A: That not what I’m suggesting.
Q: Are you suggesting that if this teller still received cash, it’ll still be described as a cash deposit?
A: That’s not what I’m suggesting my lady; description of transactions by tellers have some discretionary nature, so Teller A may describe a transaction a certain way, while Teller B will describe a transaction in a different way.
Q: The interaction between a teller and a customer…?
A: The teller’s discretion has to be applied reasonably, such that anyone looking at the transaction can understand what the transaction relates.
Just beneath that cash deposit description of the transaction under reference, which happened on 24th December, 2018, you’ll note that further particulars of the transaction was provided, and it was described as BCAM FTD payment DD24.12.18, which is to say that this credit that was given to William Addo on this day relates to the earlier GH¢4,518,575.34 that was siphoned out of his account on March 5, 2018 to BCAM on the same day.
So if William Addo picks his statement and reads this description, he will know immediately that this is a repayment of the amount that went out of his account into BCAM’s account on 5th March 2018 without his consent.
Q: I’m putting it to you that regardless of the teller’s discretion, whatever they record as reflecting a transaction involving them cannot convey any meaning other than what is contained in the payment voucher, which is the evidence of the transaction. I’m putting that to you?
A: That is so my lady. If a pay slip was completed by a customer making a deposit into his account, then that deposit into the customer’s account would be supported by that pay-in slip so completed.
Q: I’m, therefore, putting it to you that all the description you find in the statement of account attached to your witness statement reflect the transaction that you find in the…?
A: That’s so my lady. And that’s why the GH¢4518575.34 credit that was made into William Addo’s account on 24th December 2018, with a reference number prefixed TT, is what it is.
That is repayment of the GH¢4,518,575.34 that was earlier siphoned out of his account into BCAM’s account on the same day, and these payments were made out of the Government of Ghana bailout package, and the record of that transaction reflects on the three sets of documents that were submitted to the court in support of payments that were made to the 10,000 plus customers whose funds were siphoned.
Q: And it’s the same record that’s in Exhibit H11, is it not so?
A: That’s so my lady the other leg of it.
Q: I’m putting it to you that as at December 24, BCAM was a going concern and still in business?
A: That’s so my lady. I am aware that as of that day it was a growing concern, but I don’t know whether they were still in business.
Q: I’m further putting it to you that the transaction of 24 December 2018, which is described as a cash deposit, is a cash deposit made by BCAM itself and could never have been a cash deposit made by CBG into an account held by CBG itself?
A: My lady, that is not correct. As of the date, Beige Bank’s license was revoked on August 1, 2018, BCAM only had a credit on their accounts of GH¢539,515, and some pesewas.
That information is available on the … that contained the full complement of BCAM’s statement that was furnished to the learned Counsel and his team. BCAM did not have that kind of money to pay this GH¢4.5 million in question.
This GH¢4.5 million was paid to William Addo on 24 December out of the Government of Ghana bailout and that record is contained in those three sets of documents that Counsel and his team have.
Q: And it’s the same record we have in Exhibit H 11, is that correct?
A: That’s so my lady. The other … which reflects on Exhibit H11 showing that that payment came out of the Government of Ghana bailout package.
Q: From your own witness statement, you confirm that BCAM has placements with First Africa Savings and Loans amounting to over GH¢200 million, is that correct?
A: That is not so my lady. According to my witnesses statement, funds of customers were siphoned out of the account to the tune of over GH¢448 million into a fictitious bank account that was opened in the name of First Africa Savings and Loans on the instruction of the accused.
Q: Were these funds transferred directly from Beige to First Africa Saving Loans?
A: The funds were transferred from the accounts of the affected customers held with Beige Bank into BCAM’s account also held with Neige Bank, and then subsequently transferred from the same BCAM account into the fictitious account with First Africa Saving Loans also held with Beige Bank?
Q: So the First Africa account, in which funds were moved from BCAM, could only have been dealt with…?
A: Ordinarily a customer’s account can only be dealt in by that customer; that should be the norm.
Q: And this customer here…is BCAM, is that not correct
A: Yes.
Q: And so the funds with First Africa Savings and Loans (FASL) that were transferred to First Africa stands to the credit of BCAM?
A: That’s not so, once funds move from one account to another account, those funds stand to the credit of the receiving account. So my lady, the funds transferred from BCAM into the FASL account stood to the credit of FASL and not BCAM.
Q; From your answer what it means is that when customers deposit their money with Beige bank, those funds stands to the credit of Beige bank is that correct?
A: That’s not so my lady. When customers deposit money into their account, those funds will stand to the credit of those customers, however, the physical funds in terms of the cash, become available to the bank to transact business with, so the bank could decide to give those funds to people as loans, or invest those funds in interest bearing instruments in order to make a return to be able to pay back the amounts that stand to the credit of the customers that deposited those funds.
Q: So in a particular case of BCAM and FASL, BCAM was entitled to call back some of the funds it had placed with FASL?
A: Those funds were not placements, they were siphoned from account ot Beige Bank customers to BCAM account and then subsequently into the fictitious FASL. They were not legitimate transactions.
Q: You testified that one of the receivers obligation is to recover funds owed the Beige Bank?
A: That’s so.
Q: Take a look at this document. It’s a motion on notice filed by the Receiver in the commercial division of this court against 13 defendants is that correct?
A: Yes.
Q: Now the 13th defendant is BCAM?
A: Yes.
Q: In this case, the Receiver is suing these persons to retrieve monies owned the bank is that correct?
A. Yes.
Counsel: plea to court to tender a document
Prosecution: No objection
Court: Document admitted as Exhibit 3. …
Q: Are you aware that BCAM did not just have one account as a fund managing institution, are you aware?
A: I’m aware BCAM does not have one account with Beige bank.
Q; I’m putting it to you that it has accounts even with other banks including Assets?
A: I don’t know for a fact whether they have accounts with other banks. But they’d have assets I expect.
Q: I’m putting it to you that it’s not correct to say that just by looking at one statement of BCAM statement of account with Beige bank, BCAM is incapable of paying the sum of over GH¢4 million to William Addo.
A: I do not know the details of the other accounts so I will not be able to tell.
