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General News of Wednesday, 21 August 2019


BoG’s US$62.3m overseas transfer claim 'completely false' – GN

Chief Executive Officer of Groupe Nduom, Papa Kwesi Nduom Chief Executive Officer of Groupe Nduom, Papa Kwesi Nduom

Groupe Nduom, the parent company of GN Savings and Loans, whose licence was revoked recently by the Bank of Ghana, has refuted allegations by the central bank that it transferred some US$62.3 million of depositors’ funds to its subsidiaries abroad.

In its explanation for the revocation of the licence, the regulator stated that: “A recent Bank of Ghana investigation conducted at GN revealed that a significant amount (USD62,255,516.93, GBP718,528.59 and EUR4,200) of depositors’ funds held with GN had been transferred to International Business Solutions (another company owned by Groupe Nduom and which is based in the U.S.A) without any 20 documentation to support such transfers in breach of section 19 of the Foreign Exchange Act 2006, Act 723, Section IV of Bank of Ghana Notice No. BG/GOV/SEC/2007/4, and subsequent Bank of Ghana Notices issued in August 2014 prohibiting such practices”.

In response, the conglomerate said in a press statement signed by its Corporate Affairs Manager, Frank Owusu-Ofori, on Wednesday, 21 August 2019, that: “The allegations found on page 19 of the BoG’s Public Notice are the most concerning, as the statements made regarding funds transferred abroad are completely false”.

GN said they “have not transferred customer funds abroad in the manner alleged in the Public Notice”.

However, the firm explained that International Business Solutions (IBS) has provided a variety of services, including procurement and management consulting for which it was paid. According to GN, IBS purchased vehicles, generators, stationery, manufacturing raw materials, computers, and a variety of other products for sister companies such as GN Savings, Coconut Grove Hotels, EPPL, and Freshpak.

“These goods and services were provided over the course of 12 years. These products purchased by IBS (including the Ford, Dodge, and Fiat vehicles driven by company managers and the hundreds of bright yellow AKSA generators) are all here in Ghana in plain sight. These transactions saved the Groupe Nduom companies money by not going through intermediaries who would have charged huge margins on those products. They were all imported. That foreign currency was purchased using the funds of the depositors that required them and NOT from the deposits of the hundreds of thousands of other GN Savings customers”.

The release added that: “Similarly, the raw materials used to produce polystyrene-based products by Freshpak Company Limited and EPPL were all procured by IBS, after which those products were imported into Ghana and turned into finished products. Extensive documentation exist and have been provided to the BoG regarding every single transfer that pertained to Groupe Nduom. This documentation was made available both physically (thousands of pages of documents) and electronically. The documents have been with the BoG since 2018, and we received no response from the team”.

GN is, therefore, of the firm belief that: “…The statement that such a huge amount of ‘customer funds’ was transferred abroad with ‘no documentation’ is false and cannot be used to withdraw the SDI licence”.

“It appears that our only option is to pursue this case in the court of law – negotiating with the Bank of Ghana in good faith has yielded less than desirable results,” the statement noted.

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