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Capital Bank trial: Ato Essien closes case

William Ato Essien, Tetteh Nettey, Fitzgerald Odonkor and Kate Quartey-Papafio have been charged with 26 counts of conspiracy to steal

The former CEO of the defunct Capital Bank (now in receivership), William Ato Essien, on Thursday (17 March) closed his case after opening his defence on 5 November 2021 on criminal charges preferred against him and two others by the state over the collapse of Capital Bank.

Essien called two witnesses after testifying himself before Justice Eric Kyei Baffour’s Court.

The witnesses are Dr. Isaac Nyame (first defence witness), a chartered accountant, fellow of the Association of Chartered Certified Accountants (ACCA) and also a fellow of the Chartered Institute of Taxation (CIT) and Emmanuel Edward Arhin (second defence witness), a deputy chief manager at the Banking Department of the Bank of Ghana.

Essien, together with Fitzgerald Odonkor, former MD of the Capital Bank and Tettey Nettey, a director of MC Management Services, a company said to be owned by Ato Essien, have been charged by the State for allegedly stealing depositors’ funds leading to the collapse of Capital Bank Limited.

The three accused persons are alleged to have of siphoned about GH¢ 200 million out of GH¢ 620 million Ghana cedis given to Capital Bank by the Bank of Ghana as liquidity support.

In court

In Court today 17 March, Baffuor Gyawu Bonsu Ashia, lawyer for the first accused person, sort to confirm from the second defence witness, Emmanuel Edward Arhin, whether or not on 4 January 2016, Capital Bank paid the interest component of the liquidity support it took from the Bank of Ghana.

Mr Arhin in his answer said “yes.” Asked what was the actual amount paid for the month of December (2015), he said the total amount paid was GH¢ 9,936,986.30.

Chief State Attorney, Marina Appiah Opare, in her single cross-examination question to the witness asked as follows; “You will agree with me that all the interest that were debited by the bank of Ghana from the account of bank of Ghana was in accordance with the terms and conditions for the grant of the liquidity support to Capital Bank”?

The witness, Mr Emmanuel Arhin, answered “Yes” to this question posed by the Chief State Attorney, Marina Appiah Oppong.

Lawyer for the first accused person subsequently told the Court that his client’s defence has come to an end.

Justice Eric Kyei Baffour, adjourned sitting to Thursday 24 March 2022, for the second accused person (A2), Tettey Nettey, a Director of MC Management Services, to open his defence.

Justice Kyei Baffour further ruled that “A2 has been told to personally inform his lawyer to adequately prepare for the proceedings on the next adjourned date” since he was not in Court.

Background

In all, the state has called 17 prosecution witnesses throughout the case. Among the witnesses were Vish Ashiagbor, one of the receivers appointed to wind up Capital Bank; Michael Kwame Amoako-Atuobi, a former Relationship Manager for Capital Bank; Emmanuel Kontoh Arthur, a former General Manager in Charge of Treasury at Capital Bank; Sharon Okwaa Boateng, a former Supervisor of the Cash Management Unit at Capital Bank; Benone Yaw Asihene, a former Special Assistant to the Executive Committee; Donatus Kwesi Freitas, an officer of the Bank of Ghana; Daniel Gaikpah, the former Chief Banking Officer in Charge of Operations with Capital Bank; and Lawrence Otoo, a Banker.

The rest are Felix Koranteng-Asante, a businessman who dealt in installation of CCTV cameras; Peter Amadu Iliasu, the former Chief Executive of All Time Capital Ltd; Aseye Seyram Komla Akotia, a former Vice-President in Charge of Investment with All Time Capital Bank; Kwame Achampong Kyei, a former Chairman of Sovereign Bank; Edem Bart Williams, a former Chief Executive Officer of Nordea Capital; Ali Seidu, Chief Executive Officer of Maripoma, Volta and Impex Ltd; Teddy Friko, assistant to Ali Seidu; Chief Superintendent Ernest Frimpong of the Special Investigations Team; and Joseph Oppong, the Investigator.

Facts of the case

According to the facts sheet, “The first accused person, William Ato Essien, was the majority shareholder of Capital Bank Limited (Capital Bank), a wholly owned Ghanaian Bank which previously operated as a microfinance company.

The second accused person, Tetteh Nettey, was the Managing Director of MC Management Services, a company established by the first accused person purposely for the promotion of the incorporation of Sovereign Bank, another brainchild of the first accused person.

“The third accused person, Fitzgerald Odonkor, was the Managing Director of Capital Bank from June 2015 to August 2017 and the fourth accused person, Kate Quartey-Papafio, is a businesswoman and Chief Executive Officer of Reroy Cables Company Limited.”

The facts further state that: “Between June 2015 and November 2016, pursuant to an application by Capital Bank, the Bank of Ghana (BOG) provided a total sum of GHC620 million as liquidity support to Capital Bank to enable it meet its capital adequacy ratio and to enable it service its maturing debt obligations.

“In October 2015, the first accused person, aided by the 3rd accused person, caused a transfer of a sum of GHC120 million of the liquidity support amount to All Time Capital Limited (All Time), an investment management and advisory firm.

At the instance of the first, second and third accused persons, GHC100million of the GHC120 million which had been transferred to All Time, was further transferred to MC Management Services while GHC20 million of the amount of GHC120 million was transferred to Pronto Construction and Supplies Limited (Pronto Construction).

“The sum of GHC100 million which was transferred to MC Management Services was subsequently represented by the second accused person to BoG as initial capital of Sovereign Bank while the GHC20 million that was transferred to Pronto Construction was used by the managing director of Pronto Construction, ostensibly to purchase shares in Capital Bank.
“Again, at the instance of the first and third accused persons, GHC65 million out of the BoG liquidity support of GHC620 million was transferred to Nordea Capital Limited described as an investment bank.

Of the amount of GHC65 million, the first accused person, aided by the third accused person, caused GHC30 million to be transferred to MC Management Services which was represented to BoG as additional initial capital of Sovereign Bank by the second accused person.”

The facts further state: “With the aid of the third accused person, the remaining GHC35 million of the GHC65 million was paid into a Fidelity Bank account of Brietling Services, a company also established by the first accused person.

At the request of the first accused person, the amount of GHC35 million which was transferred into the account of Brietling Services was subsequently transferred to Capital Africa Group, a company owned by the first accused person.

“The total amount of GHC130 million which was represented as initial capital of Sovereign Bank was eventually channelled by the first and second accused persons into Capital Africa Group, the first accused person’s company, less bank charges.

The monies transferred into Capital Africa Group was eventually dissipated by the first and second accused persons.

“Between June 2015 and October 2016,” the facts further state, “the first accused person, with the support of the 3rd accused person, appropriated a total of GHC27.5 million of the liquidity support which was conveyed in jute bags to the first accused person and purportedly used as payment for business promotion.

“In June 2017, in furtherance of the conversion of portions of the GHC620 million liquidity support, the first accused person caused a sum of GHC100 million to be paid into a Capital Bank account held by the Managing Director of the following three companies: Maripoma Enterprise Limited, Hardwick Limited and Volta Impex Enterprise Limited opened purposely to receive the amount.

“The GHC100 million was to be used by the managing director of the three companies, ostensibly as payment for 30% shares in Capital Bank”.

“As a cover-up of the conversion, the first accused person prevailed on the managing director of the companies to submit copies of Government Payment Certificates of the three companies valued at GHC135 million to be discounted to GHC105 million by Capital Bank, to be used as collateral for the purported loan of GHC100 million”.

“The first accused person then caused GHC70 million out of the GHC100 million that had been previously paid into the managing director’s account at Capital Bank, to be transferred to the fourth accused person’s account with Calbank Limited.

“The first and fourth accused persons subsequently caused the amount of GHC70 million in the Cal Bank account of the fourth accused person to be further transferred into a personal account of the fourth accused person purposely opened at Capital Bank to receive the amount.

The facts sheet sums up as follows: “Sometime in 2017 after Capital Bank had gone into recebivership, the fourth accused person, even though fully aware that Capital ank had gone into liquidation, attempted to withdraw the whole amount of GHC70 million which had been lodged in her personal account with capital bank but was however prevented from doing so by the receiver.”

Wilberforce Asare

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