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Opinions of Friday, 24 January 2020

Columnist: Kwabena Mireku

How did Ken Ofori-Atta become a rich man?

Ken Ofori-Atta (KOA) is the Minister of Finance & Economic Planning in the Government of Ghana. He has told a global audience that he was nearly aborted as his father did not want the pregnancy. His father, Jones Ofori-Atta was the Deputy Minister of Finance in the Busia administration (1969-1972). Stories have been told about his tenure at the Achimota School and especially about how he managed to get into Yale University in the USA. Those stories will not be repeated here. Kofi Coomson formerly of the Ghanaian Chronicle newspaper has written about that period. There questions about how long he worked for Salomon Brothers and Morgan Stanley after graduating from university and returning to Ghana.

KOA is one of the founders of Databank, an investment management company in Ghana. The original founders of the company in 1990 included James Akpo, now Togbe Afede XIV. There were disagreements over policy, business direction and ethics which led to Mr. Akpo leaving to start his own company, Strategic African Securities (SAS). At that time, there were four brokerage firms in Ghana - NTHC owned by government, Databank (owned by KOA and Kelli Gadgekpo) SAS and Gold Coast Securities (owned by Dr. Papa Kwesi Nduom).

Yesterday’s friction between KOA and Togbe explain the current day attempts by KOA to use his position as Finance Minister to starve Togbe’s companies of liquidity and potentially drive him out of business. All this despite the fact that is Togbe, then James Akpo who gave KOA a place to live for several months when he moved to Ghana to start Databank. The vindictive character of the man KOA started quite early. So did a psychological need to prove he is superior to those he finds to be ahead of him.

KOA and Databank were assisted greatly by the late Victor Selormey, a Deputy Minister of Finance during the J. J. Rawlings administration. The minister is the one the NPP threw in prison for alleged misappropriation of state funds. He gave them the transaction sole sourced to offload lucrative government shares in the US$25 million packaged sale of government interests in seven listed companies. After using the state to line his pockets, he turns around to pride himself in seeking only private sector solutions.

How did Databank acquire Trust Bank Gambia, become shareholder in International Bank in Liberia and Enterprise Group. Where did KOA find the money when he came back to Ghana “with his ten fingers” and no money? How much customer funds, Epack money etc was involved?

KOA has benefitted tremendously from government transactions over the years including advising the Ghanaian government on privatization deals, the private sale of 52% (US$21 million) of the Social Security Bank (SSB).

While the pious Minister of Finance is punishing others for indiscipline, it is a fact that the EPACK product was launched and operated for years without a license from the Bank of Ghana! It was later corrected. Something he has not been willing to do for others now that he has the power.

Then there is the infamous Obotan project. Gye Nyame Concord on 02.05.2003 wrote:

“The Obotan “Garden of Eden” deal began with an undated participation memo from Databank in 1998 to Mr Charles Asare, then Director General of SSNIT to be followed days later by another letter from Mr. Dan Seddoh, Financial Controller of EIC inviting SSNIT to invest in the blue chip real estate project off the swanky, upmarket Independence and Osu avenues here in Accra. In the letter titled “RE: INVITATION FOR SSNIT INVESTMENT PARTICIPATION IN INDEPENDENCE AVENUE COMMUNITY RESIDENTIAL DEVELOPMENT,” Seddoh wrote: We would like to take this opportunity to invite SSNIT to participate in a unique real estate development project in the heart of the new business and financial district on Independence Avenue in Accra. The site is located on Independence Avenue opposite Cal Merchant Bank and on Osu Avenue opposite Taysec Gardens.

The project concept is centred around preserving and re-designing an antebellum type mansion, currently housing a Chief Executive Officer, as a well appointed and managed club house. As Auditors recommend trial of over Obotan deal AUDITORS, WHO revealed the rape of $2.244 million of workers’ contribution from the national pension fund in the ‘ghost’ Obotan “Garden of Eden” project in their report on the financial audit of SSNIT have recommended that Messrs. Databank Financial Services, Enterprise Insurance Company (EIC), and Awoonor Law Consultancy be prosecuted for “false presentation of information” to deceive SSNIT into the joint venture project. Additionally, the auditors have recommended that Messrs. Charles Asare, former Director General of SSNIT and Mr Asiedu Gyamfi, ex-Acting Head of Investments should be put on trial for reckless investments of SSNIT funds and for “gross display of incompetence and blatantly subordinating SSNIT interest in the transaction to those of Databank, Awoonor Law Consultancy and Enterprise Insurance Company.” According to the auditors, Databank, EIC and Awoonor Law Consultancy should be prosecuted for presenting false information on the Obotan project and enticing SSNIT to release money for Obotan Developers Company at a time the company did not exist and “which as at now does not have a registered office.” The auditors also argued that the trio presented incorrect information to suggest that EIC had paid $1.8 million for its 45% shares in the ‘ghost’ company, “when in actual fact EIC as at now has not contributed 1 cent towards the project.” They also recommended that SSNIT take over the house for the project at the cost of $1.650 million instead of the excess payment for part-ownership at the cost of $2.244 million that it paid, while EIC, Databank and Awoonor Law Consultancy should be made to refund the difference of $594,000 between the overpaid and the real amount that should have been paid, to SSNIT. The conclusion of the auditors was that the $2.244 million paid by SSNIT was more than enough to pay for the property that was to be developed in a joint venture into a blue chip residential facility along the Independence and Osu avenues in Accra, not far from the controversial Mormon building springing up along the same area. “In our estimation SSNIT money was collected and used to pay for the property plus allowances, commission and legal fees to so called promoters who were also members of the company (Obotan). Thereafter SSNIT was allocated just 55% shareholding and others who did not pay a dime i.e. Enterprise Insurance Company (EIC) and Social Security bank Investments (SSB) were allocated 42.5% and 2.5% respectively.””

Interestingly, it was the late President Fiifi Atta-Mills who rescued KOA from criminal prosecution after the 2008 election.

Now, KOA is going out of his way to criminalize other business people!

Now that he is rich, can his companies particularly Databank survive a run on them?

With regard to the revocation of fund management licenses, Databank is harvesting big time. Within hours after the revocation of the Frontline Capital license, the most significant pension fund, the GES one, was handed over to Databank. A trip to Cape Coast will find Databank now installed in the former UT Bank branch office. Not the only one.

And now there is speculation out there that he is worth $250 million? From abortion candidate to Togbe housemate to Victor Selormey supporter through Obotan to today. Whose money has made him rich? Customers?

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