Over a three-year period, between 2004 and 2006, the Daily Dispatch newspaper published a number of articles, on the financial risk in the Social Security and National Insurance Trust's (SSNIT) procurement of 85% equity shares in SIMNET (Gh) Limited. The paper, among other issues, alleged that the amount to be paid for those shares had been inflated by at least US$6 million. The Serious Fraud Office (SFO) and then President John Kufuor's Office of Accountability outfit started further investigations.
The Office of Accountability's investigations were allegedly stopped on 'orders from above.' The SFO, in its investigations, faced a number of impediments but continued. As at last year, the SFO had a docket ready for the Attorney-General's Office.
The findings state in part, "the following public officials and officials of SSNIT should be held liable for the key roles they played in the facilitation of the illegal and expensive transaction that was inimical to public interest...”
Background
The Daily Dispatch in April, 2006 first published an article: “¢73BN SIMNET DEAL - 2 MINISTERS FOR SFO”
In February this year (2006), President John Agyekum Kufuor ordered thorough investigations into allegations of malfeasance in the purchase price of US$8 million (over ¢73 billion) paid by the Social Security and National Insurance Trust (SSNIT) for 85% shares in SIMNET Ghana Limited. The core of the allegations has been that the price of $8 million (¢73 billion) had been inflated by over $6 million (¢55 billion). The Daily Dispatch can confirm that the Serious Fraud Office (SFO) and the Office of Accountability at the Presidency have, over the past eight weeks; been investigating. However, the two bodies have been facing serious problems and will need the full support of the President to overcome them.
Since 2004, the media, especially The Daily Dispatch, had been publishing allegations that the $8 million purchase price had been inflated. The Databank Company Limited had reportedly concluded a deal to purchase the 85% shares in SIMNET for less than US$2 million but backed out at the last minute.
Somehow, SSNIT got interested and Fidelity Company was asked to do some evaluations for SSNIT. Credible sources have hinted that Fidelity's assessment ranged from $6 million to $8 million.
An issue which many Ghanaians would want the outcome of the investigations to clear up is, why SSNIT opted for the higher price of $8 million. Another will be, why the huge difference between the price Databank had reportedly agreed to buy SIMNET and that of Fidelity.
At the time the media raised the red flag on the purchase price of $8 million by SSNIT, what did the government do? It is true that the government could not, on the basis of allegations by a newspaper that the purchase price had been inflated, cancel the agreement. However, bearing in mind that in 2001, a Minister in the NPP government was jailed for causing the loss of less than US$50,000 (¢460 million), the least action would have been for the Sector Minister to have ordered another evaluation.
It is now emerging that SSNIT may have rushed into the purchase of SIMNET. Events that have occurred since SSNIT's purchase seem to give that impression. SSNIT took over the control of SIMNET on July 8, 2004 and on July 19, 2004, an Interim Management Committee (IMC) was established. In March 2005, Mr. Kwasi Baidoo, 63, was appointed the Chief Executive Officer (CEO). Mr. J.B. Danquah, a Deputy Minister for Women and Children's Affairs, is a member of the six-member SIMNET Board, representing a foreign company, Craig Holdings; Craig has the remaining 15% shares in SIMNET.
In December, 2005, the Board chaired by the Managing Director of GLICO, Mr. Acheampong Kyei, through the CEO, declared all the 17 workers of SIMNET redundant. It then appeared that SSNIT did not have any plans on making good use of SIMNET from August 2004, till December, 2005.
For starters, the SFO has set in motion, the process of inviting some highly-placed government officials to assist in its investigations. Credible sources in Parliament have confirmed that the Speaker of Parliament, Mr. Sekyi Hughes, has received a letter from the SFO, requesting for permission to speak to Mr. Danquah in connection with its investigations into SIMNET. The Speaker's permission was sought because Mr. Danquah is the New Patriotic Party (NPP) Member of Parliament for Akim Abuakwa North.
It is also likely that the SFO will invite another Minister, who is also a Member of Parliament. However, as at the close of business on last Thursday [April 13, 2006], the Speaker had not received any such letter.
There had been credible reports that pressure maybe brought to bear on the Attorney-General and the Minister of Justice, Mr. Ayikoi Otoo to intervene, but will he?"
Source: Daily Dispatch/Ghana
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