Sun, Oct

Finance Minister, Mr. Ken Ofori-Atta

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In respect of the allegation that the Minister has interest in Batabank and Enterprise, CHRAJ found such interest to be significantly present.

In the previous part of this note, I concluded that CHRAJ could only clear the Minister of the allegations of conflict of interest violations if it finds the following: (1) That the Minister did not breach the BoG rules on issuing such bonds; (2) That the alleged crony-relationship did not exist; or (3) that even if the alleged crony-relationships existed, the Minister has taken refuge at the safe harbour under Article 78(3).

In this concluding Part of my note, I’ll outline the findings of CHRAJ in respect of each of these 3 issues. I’ll do this by simply reproducing the relevant parts of the report.

Related: The Bond Saga, CHRAJ and The Rules on Conflict of Interest -Part 1

Related: The Bond Saga, CHRAJ and The Rules on Conflict of Interest -Part 2

Related: The Bond Saga, CHRAJ and The Rules on Conflict of Interest -Part 3

(1) Did the Minister Breach the BoG Rules?

In respect of the allegation that the Minister breached the BoG rules for issuing such bonds, CHRAJ found that the Minister did breach the rule. Here are some of the findings in this respect at pages 109 and 117 respectively:

“In terms of the 7-year and 15-year bonds, the BOG should have notified the market at least two (2) weeks in advance of their issue since they were “new products” in accordance with the Bank of Ghana Guidelines. But as the evidence shows, the market was notified only one (1) day on the availability of the 7-year and 15-year bonds prior to the commencement of trading. This period is shorter than the 2-3 days period that the previous issues provided.”

“The publication by BOG on the availability of the financial instrument (5-year and 10-year bonds) was not done “two weeks prior to the commencement of the Calendar period which was state as 30 March 2017 as required by Rule 2.0.(a) of the BOG Guidelines. The publication was done on same day trading was to commence.”

(2) Did a Crony-relationship Exist?

In respect of the allegation that the Minister has interest in Batabank and Enterprise, CHRAJ found such interest to be significantly present. It says on page … of the report:

“The evidence before the Commission shows that before assuming or on the assumption of duty, the Respondent had and still has personal interests, some pecuniary and other non-pecuniary. The Assets Declaration Form which the Respondent completed and submitted to the Auditor-General in compliance with Article 286(6) of the Constitution and dated 12 March 2017 discloses that the Respondent has employment or business interests listed as unspecified shares in Databank, Ventures and Acquisition and Enterprise Group Ltd.”

CHRAJ found that Trafgarne, too, has interests in both Templeton AND Enterprise. It says on page 120 of the report that:

“FT [Franklin Templeton] unaudited report 2017indicates that the “Honourable Trevor G. Trefgarne was appointed to the Board of Franklin Templeton Investment Funds on November 29, 2002. He is the Chairman of Enterprise Group Limited, Ghana, and has been Diretor of a number of U.K. Listed investment funds including Templeton Emerging Markets Investment Trust, Recovery Trust (Chairman) and Gartmore High Income Trust. He has extensive experience of the management of listed companies in the UK and Africa”

(3) Did the Minister Dock at the Safe Harbour?

The Ministers did not allege and CHRAJ did not find any evidence that the Minister made a disclosure to Parliament on the material facts of his relationship with Templeton (to which 95% of bond of the US$ 2.25 billion bonds was sold in breach of the BOG rules). As a matter of fact, CHRAJ found that the Minister concealed some of his assets in breach of the asset declaration laws. It stated at page 120 as follow:

“It is observed that the Respondent [Minister] had other assets which he did not disclose in his Asset Declaration Form. They include his interest in Databank Financial Services Limited and Databank Brokerage Limited.”

In the teeth of all this, CHRAJ was still able to conclude that:

“[T]he allegations by the Complainant that the Respondent has contravened Article 284 of the 1992 Constitution by putting himself in a conflict of interest situation in relation to the issuance of the 5-year, 7-year, 10-year and 15-year bonds, have not been substantiated.” (Underlining mine)

How CHRAJ Erred

But, hey, how did CHRAJ arrive at this conclusion? We may get the answer to this question from the reasoning at page 133 of the report:

“There was also no evidence before the Commission at this stage that there was a personal benefit to the Respondent or his business and other relations. On the basis of the foregoing, it is reasonable to conclude that though there was the significant potential that the Respondent’s personal interest could have been in conflict with the vast personal interest in the securities sector, it was not the case in this specific bond issue.” (Underlining is mine)

It may be obvious from this reasoning that CHRAJ got to this rather lonely conclusion by relying on a rule in the Okudzeto Ablakwa (No. 2) case. The rule in that case is that a person cannot be guilty of a breach of Articles 23, 35(8) and 296 (NOT Article 284) unless she is found to have actually derived a “personal benefit” from the transaction. But as I’ve disclosed in the previous part of this note, this rule has absolutely nothing to do with Article 248 conflict of interest claims; and shouldn’t have come in here at all.

Way Forward

CHRAJ’s decision may be reviewed by the courts. This allows for 3 things to happen. First, the Minister may seek a review of the decision if he honestly believes that CHRAJ’s findings do not reflect the facts. Second, the complainant, too, may seek a review from the courts if he believes (as I do) that CHRAJ’s decision is at war with the facts it found. The final option is for a citizen to seek a review.

Happy new year!


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