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University of Ghana’s GHS456,000 locked up in defunct financial firm – Audit report

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An amount of GHS456,199.08 invested by the University of Ghana has been locked in a defunct Fund Management Company; Liberty Asset.

This was contained in the 2020 Auditor-General’s report, which revealed that the University’s College of Health Sciences and School of Medicine and Dentistry invested the money in contravention of the school’s own financial Regulations and Governance.

While the College of Health invested GHS377,003.00, the School of Medicine and Dentistry invested GHS79,196.08. Both investments were made in 2016.

“There was no evidence of due diligence report available to continue investment with Liberty Asset in terms of its risk profile”, the report mentioned.

“We noted that the College Administration and School of Medicine and Dentistry (SMD) invested a total amount of GHS 456,199.08 in Liberty Asset which, is not a commercial bank and does not meet any minimum capital requirements of Bank of Ghana”, paragraph 1009 of the audit report on Public Boards noted.

Liberty Asset was one of the companies the Securities and Exchange Commission (SEC) revoked their licences in 2019.

SEC, in a statement, explained that the revocation follows the companies’ failure to “return client funds which remain locked up and in a number of cases, has even folded up their operations.”

But the University of Ghana’s anomaly according to the report was a result of the failure of the College to develop a monitoring mechanism to ensure that all units adhere to the university’s directives.

It added that the situation has the tendency to increase the financial risk exposure of the university.

The Auditor-General has recommended to the management of the university to strengthen its investment oversight activities on treasury management and ensure strict adherence to the policy instruction on investments.

“Furthermore, any investment amount lost by the university may be disallowed and surcharged against the affected officers in accordance with Article 187 of the 1992 Constitution of Ghana and Section 18 of the Audit Service Act 2000, Act 584,” the report added.

Management response

Management of the University of Ghana in responding to this said that the investment was “made before the Vice Chancellor’s instruction issued on 4 October 2018. The investment was being rolled over as efforts made to call in the investment were not successful”.

The University insisted that due “processes were followed before the investment was made”.

“Liberty Asset is currently under receivership and follow-ups are being made. Investment Committee has been reconstituted and has issued guidelines on investments as of February 2020 pending the finalization of the investment policy. This is to ensure that such incidences do not recur,” University authorities added.

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EU fines banks including Barclays, NatWest and HSBC £293m for currency ‘cartel’

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The EU has fined banks, including Barclays, NatWest and HSBC, a total of €344m (£293m) for roles in an alleged foreign exchange spot trading cartel.

The European Commission said the UK-based banks agreed to settle the case, alongside UBS which avoided a penalty because it had blown the whistle on the activity.

HSBC’s fine was the largest at €174.3m (£148m) while its Canary Wharf-headquartered neighbour Barclays was to pay €54.3m (£46m).

NatWest – which was known by its former RBS Group name at the time – faces a €32.5m (£28m) bill.

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Image:Both HSBC and Barclays have their headquarters at London’s Canary Wharf

Credit Suisse was the other bank to be handed a fine – of €83m (£71m).Advertisement

The EU’s competition regulator said the cartel had focused on forex spot trading of G10 currencies, which include the US dollar, euro and UK pound.

The Commission’s competition chief, Margrethe Vestager, said: “Today we complete our sixth cartel investigation in the financial sector since 2013 and conclude the third leg of our investigation into the foreign exchange spot trading market.

“Our cartel decisions to fine UBS, Barclays, RBS, HSBC and Credit Suisse send a clear message that the Commission remains committed to ensure a sound and competitive financial sector that is essential for investment and growth.

“Foreign exchange spot trading activities are one of the largest financial markets in the world. The collusive behaviour of the five banks undermined the integrity of the financial sector at the expense of the European economy and consumers”.

The fines are the latest to hit banks, which have received billions of pounds worth of penalties worldwide since the financial crisis of 2008 for the rigging of benchmarks used in many day-to-day financial transactions.

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Ghana on course to becoming aviation hub – Ex-GACL boss

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A former Managing Director of the Ghana Airport Company Limited, Charles Asare says Ghana is on course to becoming a preferred aviation hub and a leader in air-travel business in West Africa with the commencement of commercial flights to Ho and Wa airports from Accra.

Mr Asare noted that “by developing a world-class terminal (terminal 3) at the Kotoka International Airpot, a rehabilitation of the Tamale and Kumasi airports and the introduction of new regional airports in Ho and Wa coupled with a continues improvement safety and service delivery, there is no doubt that Ghana will become a preferred aviation hub in the subregion”.

The former GACL boss’ comment comes on the back of the announcement of the local carrier, Passion Air, to begin commercial flights through Ho and Wa beginning Saturday, December 4, 2021.

This will be the first time an airline will fly the route commercially after the Ho Airport was completed in 2018.

The $25 million project, which was scheduled for completion in September 2016, actually concluded in 2018 with a 1,900-metre runway, a traffic control tower, a 1,150-capacity passenger waiting area, an ultramodern airbus terminal, and an automatic fire detection and control system.

Another local carrier, Africa World Airline, conducted test flights to Ho in mid-2021 with a promise to begin commercial travel on the route in June 2021, but that did not hold.

Passion Air’s operation of the route will cut travel time of about 5 hours (traffic inclusive) from Accra to Ho by road to about 20 to 30 minutes by air.

Coupled with the bad nature of the roads leading to the Volta Region, which is an acclaimed tourist destination, it is expected that the route will see maximum patronage from locals resident in Accra who will visit home regularly and tourists who have stayed away from the area due to the nature of the roads.

Mr. Asare, speaking during an inaugural flight to Ho on Wednesday, December 1, 2021, urged Passion Air to develop more routes from Ho to other regional capitals and even to neighbouring countries.

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President woos Norwegian investors to back Ghana’s railway sector

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President Akufo-Addo has urged investors from Norway to consider partnering government to develop a modern railway network in the country.

This follows recent comments by the Minister for Railway Development, John Peter Amewu, to the effect that the government would not be able to construct any sky train in the country in the near future.

The Minister noted that funding for the construction of some of the already started projects is becoming problematic for the government.

But in an address at the Ghana-Norway business and investment forum in Accra, President Akufo-Addo noted that his government is embarking on an aggressive program to attract the needed investment to develop the railway and road infrastructure needed in the country.

“We are hopeful that with solid private sector participation, we can develop a modern railway network with strong production centre linkages and with a potential to connect us with our neighbours.”

“Members of the Norwegian business community, you can choose to invest in Ghana through the GIPC or set up as a free zones enterprise, regardless of where the investment is, the government has instituted a number of fiscal incentives for the investor depending on the nature of the activity or the location of the investment. I want us to build a stronger Ghana-Norway relationship for the benefit of our respective shareholders,” he added.

‘There won’t be any sky train in Ghana, it’s not possible’ – Amewu

The Minister for Railway Development, John Peter Amewu, has said the government would not be able to construct any sky train in the country.

According to him, it is not possible to do so.

In November 2019, the government through the then Minister for the sector, Joe Ghartey, signed an agreement for the construction of the Accra SkyTrain Project on the sidelines of the African Investment Forum in South Africa.

The proposed initiative in Accra provides for the development of five routes, four of which are comprised of radial routes that originate at the proposed SkyTrain Terminal, at the heart of Accra, at the Kwame Nkrumah Circle, and one route that provides an intra-city commuter loop distribution service, also emanating from Circle.

The project envisaged a total track length across all routes of 194 kilometres.

Subsequently, the management of the Ghana Railway Development Authority disclosed that feasibility studies on the proposed sky-train project in Accra had been completed.

The Chief Executive Officer (CEO) of the Authority, Richard Diedong Dombo assured that government will begin implementation of the project after scrutinizing the report it has received.

“The sky trains are on an elevator platform rather than underground. They will be running on platforms over the city of Accra. It will be a community train and not an intercity one. At the moment, the feasibility studies have been completed and it is being studied before the contract is signed,” he said.

However, speaking on Citi TV’s Face to Face programme on Tuesday, November 23, 2021, the current sector minister, John Peter Amewu said the government would not go ahead with the sky train project.

According to him, the government cannot fund the project because it is capital intensive.

“The sky train that we are talking about is the one that is going to run on columns in the sky like the ones you see in Dubai but no agreement has been signed.”

“It is not possible to be done now. I don’t see any sky train being done in the next 3-4 years. There is not going to be any Sky train in the country. It is not possible.”

He also added that funding for the construction of some of the already started projects is becoming problematic for the government.

“Rail construction takes a lot of time and it is also capital intensive. A kilometre of a railway line is about four to five times the cost of building a concrete infrastructure in terms of building an asphaltic road.”

“So considering the fiscal space that we have in the country, facilities to absorb it is becoming problematic for the government and you know our current debt to GDP which is in excess of 70%.”

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