In the course of assessing the financial position of the defunct Microfinance Finance Companies (MFCs) and Savings and Loans and Finance House Companies (S&Ls), it was noted that there was a mismatch in the assets and liabilities as reported by these institutions, the Bank of Ghana (BoG) has said in its update on the banking sector clean up exercise.
In addition, the BoG, said there were transactions that required further investigation to determine their legitimacy.
The Receiver engaged the assistance of the Economic and Organized Crime Office (EOCO) to jointly investigate the operators of the resolved Special Deposit-Taking Institutions (SDIs), following clearance by BoG, the update said.
The Key issues submitted to EOCO for investigations were ‘hidden assets and/or assets in books not found by the Receiver; related party transactions and untraceable investments’.
The Bank of Ghana said it will continue to collaborate with EOCO towards investigating transactions relating to the SDIs as well as other matters that will result in maximising the realisation of assets of these SDIs, Finalise investigations into the related party transactions of these SDIs.
Meanwhile, dockets have been forwarded by EOCO to AG for advise and prosecution. EOCO has been following up with AG. EOCO and the Receiver to act as prosecution witnesses in the event the cases go for trial.
The Bank Ghana with support from the Finance Ministry swept through the financial sector of the economy between the period 2017 and 2019.
The central bank first started by revising the minimum paid-up capital for existing banks and new entrants from GHS120 million to GHS400 million.
According to the regulator, this was to test the viability of the banks.
The banks that were unable to meet this new requirement were either merged or collapsed.
Following this action, some nine local banks, 23 savings & loans companies, 347 microfinance institutions, 39 finance houses and 53 fund management companies closed down during the exercise.
In total, the government spent GHSS23billion to undertake this exercise
UniBank, The Sovereign Bank, The Beige Bank, Premium Bank, The Royal Bank, Heritage Bank, Construction Bank, UT Bank, Capital Bank all collapsed.
By Laud Nartey|3news.com|Ghana