CAL Bank Cited for fraudulent Auction

CAL BANK, 3 OTHERS CITED FOR FRAUDULENT AUCTION

By Sebastian R. Freiku

WORKERS OF Ganem Timbers, a defunct Timber firm in Kumasi, are contemplating to haul Cal Merchant Bank to court for its role in the alleged fraudulent auction and illegal sale of the company in 1997. CAL Bank had brought a case of default against Ganem. A.J. Fanji and Univerco, the buyers as well as Consider Mart, the auctioneers per its Managing Director, Mr. Moses Antwi are also to be dragged to court.

By the intended action, the workers are seeking to nullify the sale on the grounds of fraud and non-compliance of Bodies Corporate Liquidations Act 180 of 1963. The aggrieved workers, numbering about 80 believe that the sale of the company situated at Chirapatre in Kumasi as ordered by a Kumasi High Court in January 1997 was fraudulent premised on the fact that management was not given the slightest chance to ,make good of the Indebtedness to the bank.

According to the workers, attempts to stop the sale were allegedly blocked by the trial court. The workers would therefore want to prove in court with documentary evidence and detail the roles of the auctioneers, Cal Bank and the buyers in the transaction.

The position of the workers has been communicated to CAL Bank, the auctioneer and the buyers by George Sarpong Legal Services acting as solicitors for the MD of Ganem Timbers.

In a correspondence dated September 13, 12010 to that effect, Lawyer Sarpong said the entire process of the auction and sale was fraudulent and negated the Bodies Corporate (Official) Liquidations Act. Exposing the said shoddy deals in the sale of the company, Mr. Philip Amoako Boateng, the spokesman of the aggrieved workers , told TRUTH that in 1997, the company was sold on the orders of the High Court presided over by Mr. Justice Abrahams, now retired.

Ganem Timbers, according to Boateng, was sold for only GH¢63,000 against the auction reserved price of GH¢113,000.00. He said the money accrued from the sale was not paid to the Court for disbursement by the registrar as required by law.

By the transaction, Ganem had been deprived of the balance after the deductions of the indebtedness while Government lost revenue from taxes on the sale.

The spokesman explained that the workers, some of whom are dead out of frustration lost their job and entire end-of-service benefits as CAL Bank did not see the need to pay claims and emoluments to the workers claiming that the action against Ganem was to recover an outstanding facility and not to have the company liquidated.

Messrs. Kwadwo Owusu Afriyie and Associates representing Moses Antwi, the auctioneer’s interest, has responded that even though Consider Mart effected the controversial auction, proceeds of the sale at the auction did not go to his client (Moses Antwi) neither did it go t the court registry.

It was indicated that Antwi was only made to issue receipt covering GH¢110,000.00 to the purchasers.

Lawyer Owusu Afriyie also known as Sir John confirmed a seeming fraud when he admitted that his client’s commission of 7% on the purchase price of GH¢110,000.00 was not given to him. According to Sir John’s letter of September 27, 2010, only GH¢3,800.00 was paid to his client as commission for the sale of some properties including sawmill and equipment. Meanwhile, a senior High Court Registrar, Mr. Francis K. Gedzeah in Kumasi has confirmed the fears of the concerned workers that proceeds of the transaction was not paid to the court for disbursement.

“I wish to state that our (Kumasi High Court) records indicated that he proceeds from the auction sale was not lodged a t the court by the auctioneer” Mr. Gedzeah responded to an enquiry on November 1, 2010.