Lawyers of the founder of the defunct Beige Bank have told the High Court in Accra that their client Michael Nyineku was denied the opportunity to respond to queries by the Bank of Ghana (BoG) as pertains to best industry practices.

Lead lawyer Thaddeus Sory said though the BoG had written to his client to answer to findings, the receiver of the Beige Bank and the KPMG, accounting audit firm never granted him that opportunity upon taking over.

Mr Sory while accusing the receiver of acting in “bad faith” also accused the audit firm and the receiver of having “a special interest in the assignment entrusted to them” by the Bank of Ghana, hence they resolved not to grant the accused the opportunity he required.

Lawyer Thaddeus Sory who was putting questions to Julius Ayivor, a Chartered Accountant with KPMG, currently on secondment to the office of the Receiver of Beige Bank as one of its lead sources, said the the BoG had earlier written to the Beige Bank seeking its answers.

Counsel again put it to the witness that, by a letter dated August 1, 2018, the Bank of Ghana had informed Beige Bank that it was giving it an opportunity to regularise any adverse findings it had made against the bank.

“Because of the source of his fees the Receiver and also KPMG have a special interest in the assignment entrusted to them by the BoG in respect of the bank,” Lawyer Sory pointed out.

Mr Sory also put it to the witness, Julius Ayivor that “in this particular instance you never gave Beige Bank an opportunity to correct any irregularities by reference to the 1st August 2018 date when you were seconded to the Receiver.”

But, Mr Ayivor, the first Prosecution Witness who was facing cross examination after having earlier given his evidence in chief disagreed.

“My Lady, that would not be the case and I would explain. On August 1, 2018, when Beige Bank licence was revoked all powers of management, directors, and shareholders of the bank were suspended and those powers were reposed in he Receiver effectively causing the Receiver to become the sole legal representative of the bank.”

He said on his appointment on August 1, 2018, officials of Beige Bank now defunct became non-existent technically.

He also said “The Receiver’s professional obligations in terms of the discussion of findings that were identifies and determined to be irregular would be towards the BoG and then in the course of the investigations if there are any matters that requires clarification he engaged some of the ex-staff that were still at post especially those that worked in the financial and the credit department including in some instances the accused person.”

He then said “I am not aware whether or not there were any discussions between the BoG and the former management of Beige Bank post August 1, 2018 in relation to irregular transactions that were identifies.”

*Bad faith*

Counsel further put it to the witness that the revocation of its license on the same day, the appointment of the receiver on the that same day and his secondment on that same day was done in bad faith.

But, the witness said “I am aware that any concerns that anybody may have concerning the revocation of the bank’s license is supposed to be ironed out at arbitration.”

Adding that, “I am therefore not in a position to determine whether or not there is any bad faith in this case.”

*Secondment*

Mr Ayivor. The first of the seven witnesses that the state had intended to call told the court that he was seconded to the Receiver and that the receiver was appointed by the Bank of Ghana?

Asked to tell when the other team members of his team were appointed, the witness said, “some were seconded on the same August 1, 2018 and other afterwards.

Asked by defence counsel to confirm those who were seconded on the August 1, he said “I don’t have the full details of all the numbers that were seconded on August 1 because of the volume and the amount of work that was required to be done in that first day.”

While recalling some of the names he mentioned- Sam Aluko, Robert Dzato and Collins Agyapong as being part.

Asked to tell the court if he knew from which institutions those people he mentioned were seconded to the Receiver, the witness said “They were all employees of KPMG.”

Asked again if the receiver had anything to do with KPMG, the witness said, “The receiver was once a senior partner at KPMG.”

At this point counsel asked the witness “Are you aware that on August 1, 2018, when you were seconded to the Receiver the Bank of Ghana had written to the bank and giving them time within which to regularise some issues the BoG had identified with the bank?

In his response, the witness said he was unaware.

When counsel asked him to tell the court who pays for him and his services rendered to the Receiver, he said “I am an employee of KPMG so KPMG pays my salary. “

When counsel asked KPMG is paid any money for the services he the witness render to the Receiver, he said, “KPMG is paid professional fees for the services of persons seconded from KPMG to perform on the receivership.”

Asked to tell the court if he knew the source of funds from which KPMG is paid as a result of his services to the Receiver on secondment. In his response he said, “the receiver’s fees are paid from proceeds realised from the receivership assignment in accordance with the requirements of the Banks and Specialised Deposit-Taking Institutions Act, 2016, Act 930. “

“The Receiver’s interest and that of KPMG’s would be to execute the receivership work in accordance with the Receiver’s mandate as stipulated by the Act and also based on the directions that BoG will from time to time give the receiver in the course of his assignment,” he told the court.

The Financial and Economic division of the Accra High Court presided over by Justice Afia Serwah Asare-Botwe, a Justice of the Court of Appeal sitting as an additional High Court judge has adjourned the case to February 10, 2023 for continuation.

Source: Kasapafmonline.com/Murtala Inusah