Yaw Odame-Darkwa, a former board member of the Ghana Infrastructure Investment Fund (GIIF) and the prosecution’s first witness (PW1), has told the Criminal Division of the High Court in Accra that the Accra Sky Train Project was a pipeline initiative that never received board approval.
Testifying under intense cross-examination by Victoria Barth, counsel for the first accused (A1), Solomon Asamoah, former Chief Executive Officer of GIIF, Mr Odame-Darkwa maintained that the sky train project was among several projects at various developmental stages presented to the Investment Committee (IC) and the board as part of GIIF’s project pipeline.
The witness appeared before the court presided over by Her Ladyship Justice Audrey Kocuvie-Tay on Wednesday.
According to PW1, the sky train project failed to go through the laid-down approval processes, including full third-party due diligence by external consultants, which accounted for the absence of formal board approval.
Board Minutes and Pipeline Projects
During cross-examination, counsel for A1 referred PW1 to Exhibit 5, the minutes of a GIIF board meeting held in June 2019.
The witness confirmed that the IC chairperson at the time, Ms Nana Agya Ababio, presented reports from IC meetings held on May 23 and June 13, 2019, including a project portfolio update.
PW1 admitted that the Accra Sky Train Project was listed among several projects, including the On-Dock Container Terminal, Platinum Plaza, Woodfields Fuel Storage Depot, and others. However, he stressed that listing a project in IC or board updates did not amount to approval.
“The update that you see here is the project pipeline — all the projects that come to the IC,” PW1 explained, adding that some listed projects, such as the Woodfields Fuel Storage Depot, were never invested in during his tenure.
He further told the court that approval under GIIF procedures was a process, with due diligence being “the most important aspect.”
$2 Million Disbursement Disputed
Counsel confronted the witness with the Auditor-General’s Report (Exhibit 20), which referenced a US$2 million payment to the Accra Sky Train Project.
PW1 initially pointed to the wrong item but later acknowledged that item 925 of the report showed the payment was made on February 20, 2019.
While conceding that GIIF did not habitually disburse funds for unapproved pipeline projects, PW1 insisted he was unaware of the disbursement at the time and only became aware of it after leaving the board.
When pressed that the financial statements for 2019 and 2020 — which he and other board members approved — showed the payment occurred during his tenure, PW1 declined to accept that he knew or ought to have known about the transaction.
“I don’t agree,” he repeatedly told the court, though he did not dispute the accuracy of either the Auditor-General’s report or the financial statements.
Signed Minutes and Board Practice
The witness acknowledged that signed board minutes constitute official records of proceedings, agreeing that individual recollections cannot override them. He also confirmed that board members had opportunities to correct minutes before adoption.
PW1 admitted that subsequent board minutes captured updates on the Accra Sky Train Project, but argued that such updates still did not amount to approval.
He further agreed that the board granted conditional approvals for some projects, such as the US$10 million additional investment in the Platinum Plaza Project, while granting unconditional approval for a US$1 million investment in the Asian Infrastructure Investment Bank (AIIB).
However, he sought to distinguish the AIIB investment on grounds that it was a well-known and credible multilateral development institution, unlike the sky train project.
Under questioning, PW1 acknowledged that GIIF board members owed fiduciary duties under Section 10 of the GIIF Act, similar to directors under the Companies Act, including the duty to exercise independent professional judgment.
He also confirmed that during his tenure on the boards of two banks, he underwent mandatory corporate governance training.The witness further testified on the role of the Audit Committee in budget preparation and approval, confirming that he presented the 2020 draft budget to the board in January 2020.
Counsel for A1 also confronted him with an email dated January 25, 2019, allegedly sent by Solomon Asamoah to board members regarding an addendum to the 2019 budget estimates, to which PW1 acknowledged receipt.
The court adjourned proceedings to January 22 for the continuation of cross-examination.
Continuation of cross-examination
Q. Have a look at exhibit 5 which is a minute of GIIF board held on June 2019. Turn to page 3 item 5.2. Do you see a report from the investment and finance committee?
A. Yes.
Q. The chairperson of the IC at the time was Ms. Nana Agya Ababio. Is that correct?
A. Yes my lady
Q. She presented a report to the full board on two meetings which had been held by the IC on 23 May 2019 and 13 June 2019 respectively. Is that correct?
A. Yes.
Q. At item 5.1.2 she gave a project portfolio update. Is that correct?
A. Yes
Q. She listed the following projects: On dock container and multi-purpose terminal, new oil jetty, Marha beach resort project, Ghana airport company capital investment programme, Atuabo power project, Rotan power project, western corridor fiber optic project, platinum plaza project, woodfields fuel storage depot project, Accra Sky Train project, and AFC Shares. Is that correct?
A. Yes my lady.
Q. You were still a member of the IC between May and June 2019 when the two IC meetings on which the IC chairperson presented her report took place. Were you not?
A. Yes my lady.
Q. You were also present when she presented her report took place at the board. Is that not so?
A. Yes my lady.
Q. At item 5.2 on page 6 of exhibit 5 do you see that the IC chair in her projects update listed the projects in respects of which there had been no new development?
A. Yes my lady.
Q. Is there anywhere in the minutes in exhibit 5 where you raised an objection that the acts sky train project had not yet been approved by the board?
A. No. The update that you see here is the project pipeline, all the projects that come to the IC. So there is even one that I can confidently say that up to date we did not invest in it which is the woodfields fuel storage. If any investment has been done on it, it would have been done when we had left the board. I still want to remind the court that our approval is a process so the fact that you see about being mentioned several times don’t mean that the board has approved it.
The most important aspect of the approval is due diligence being done by third parties, i.e high class consultants advising the board to go ahead and do the project. In any event what we see here about the sky train doesn’t say anything about approval or no approval for me to raise any objection. The chairperson was just giving a general update.
Q. You stated in your witness statement that you found out about the payment of the $2 million investment in the sky train project from the auditor general’s report, which is now in evidence as exhibit 20 and before you. Please show the court where the payment is mention in the Auditor General’s report.
A. Item 921 on page 193.
Q. You see that there is no mention of $2 million payment at page 921 of page 193 of exhibit 20. Is there?
A. No. It’s actually on 925.
Q. According to item 925 of exhibit 20 when was the $2 million payment made?
A. 20th February 2019
Q. Was GIIF in the habit of making $2 million payment for pipeline projects that have not been approved by the board?
A. No my lady.
Q. And so in exhibit 5 when the IC had its two meetings in May 2019 and June 2019 the sky train project was not a mere pipeline project, was it?
A. It had not been approved.
Q. Whether it was approved or not it cannot be described as pipe line projects based on your evidence on pipe line projects. Could it?
A. I disagree with counsel.
Q. Could the sky train project be described as a pipe line after the $2 million investment had been made by GIIF
A. In my witness statement I said I didn’t know about the disbursement until I left there…and this matter came up.
Q. Following the adoption of your witness statement as your evidence in chief before this court you had acknowledged that the disbursement of the $2 million happened while you were still a member of the GIIF. Is that correct?
A. It is not who is… it is the paper trail which is showing it that.
Q. Do you dispute the Auditor General’s report on the payment of the $2 million investment in the sky train project?
A. No my lady.
Q. Do you dispute the accuracy of the financial statements for the years ended 2019 and 2020 which you and your fellow board members approved?
A. No my lady.
Q. Therefore, if the financial statements show that the disbursement happened during your tenure and you confirmed their accuracy, you will agree with me that you knew or ought to have know that the $2 million was paid during your turn. Would you not agree?
A. I don’t agree.
Q. You don’t agree because agreeing would mean you are changing your testimony about the non-approval of the sky train project. Is that not so?
A. No my lady.
Q. In exhibit 5 at page 3, item 3.1 do you see a reference to corrections made in the minutes of 13 March 2019?
A. Yes.
Q. When you made your statements to the NIB, you did not have the opportunity to refresh your memory with the minutes of the board meeting held on 13 March 2019 and the minutes of the two IC meetings held on 23/5/19 and 13/6/19. Did you?
A. My lady I’m not sure about that.
Q. Do you remember testifying in this court that apart from the board minutes in evidence before this court as exhibits 3,4,5,6,7,8,8,10, you were not shown any other minutes at the NIB before you made your statement?
A. Yes.
Q. So now are you sure you did not have the opportunity to refresh your memory with the minutes of the board meeting held on 13 March 2019 and the minutes of the two IC meetings held on 23/5/19 and 13/6/19.
A. My lady I’ve answered this question that I’m not sure that they were shown to me.
Q. Do you realize that in your earlier answer to any other minutes that had been shown to you, you did not say you were not sure. Your wanderer was categorical that you had not been shown any other minutes.
A. My lady my answer is that I’m not sure.
Q. The minutes of 19/11/19 is what is in evidence before this court as exhibits 6. Is that not so?
A. Yes my lady.
Q. According to the last paragraph of item 3.0 at page 2 of exhibit 7, you were the one recorded as moving for the adoption of the minutes in exhibit 6. Is that correct?
A. Yes my lady.
Q. You recall that exhibit 6 is the minutes than you said is not so perfect. Do you?
A. Yes my lady.
Q. You will agree with me that based on item 3.0 at page 2 of exhibit 7, all board members present at the meeting of 08/01/2020 had the opportunity to make corrections to Exhibit 6?
A. I also said that there is a reduced version of what actually went on in the meeting. But I must also add that it’s normal because at the board sometimes we have… all this will not be captured by the secretary.
Q. You will agree with me that signed minutes are the evidence of what transpired at a meeting of board members and not the individual accounts of the recollection of those attended the meeting.
A. Yes my lady.
Q. Look at item 4.1 on page 2 of exhibit it 7. You will agree with me that it captures an update on the Accra sky train project. Is that not so?
A. Yes my lady.
Q. Please turn to page 3, item 5.1.3 which ends at page 4. I’ll give you time to read it and I’ll ask you a question.
Having read item 5.1.3 to its conclusion, you will agree with me that the board granted a conditional approval for the additional investment of $10 million in the platinum plaza project. Would you not?
A. Yes my lady.
Q. The approval was conditional because it was granted in principle subject to due diligence. Is that not so?
A. That how the board worked. All approvals are subject to due diligence.
Q. Please take your time and read the entire paragraph in item 5.1.4 on par 4 of exhibit 7.
From your reading of item 5.1.4 you will agree with me that the board have an unconditional approval to the recommendation of the IC that GIIF invests $1 million on behalf of the government of Ghana in Asian infrastructure investment bank.
A. On the face of it, yes. When such a request comes late from the ministry of finance which is also the ministry responsible… we have no way of saying no to them. Besides at the back of the minds of the board members we know that the ministry would have done some background on the Asian infrastructure investment bank. We also did our indivisible checks at board level.
Q. It is not correct that the board of GIIF had no right to say no to any orders simply because it was based on a request from the ministry of finance.
A. My lady, That is so.
Q. Are you aware that under the GIIF Act, section 10 to be precise, a member of the board of GIIF has the same fiduciary duty to act with loyalty and in good faith as the director of a company incorporated under the companies act?
A. Yes my lady.
Q. In gay based on your extensive boards experience you are aware of the duties of directors as stated in the companies act. Are you not?
A. Yes my lady.
Q. Indeed during your tenure as a board member of two banks you would have undergone mandatory corporate governance training. Is that not correct?
A. Yes my lady.
Q. So you are aware that GIIF board members were required at all times in the discharge of their functions to exercise independent professional judgment. Is that not so?
A. Yes my lady
Q. Read item 5.1.5 on pages 4 and 5 of exhibit 7 the lm I’ll ask you a question. From your reading of item 5.1.5 you will agree with me that on the screen safari project the board declined granting an approval subject to due diligence and rather deferred its approval until some due diligence had been done.
A. Yes my lady.
Q. Therefore from exhibit 7 items 5.1.3, 5.1.4 and 5.1.5, it is evident that board’s approvals were not always subject to due diligence. Is that not so.
A. On the surface of it, yes. But Kennedy explain.
Q. The Asian infrastructure investment is a development financial institution similar to the African development bank. It is a well-known organisation, a credible organisation which is known all over. If I’m on the board and I’m being asked to make an investment in such institution I will not apply the same principle that I will apply to an u known AI Accra Sky Train project or a crown safari project.
Q. Is there any part of exhibit 7 apart from its surface?
A. Yes.
Q. Your assertion that he Asian infrastructure investment bank is a well-I own financial institution. It is not captured in exhibit 7, is it?
A. It is not. But I was in the board.
Q. Your reasoning for how you approach an investment decision in that bank is also not captured on the surface of exhibit 7. Is it?
A. Yes my lord.
Q. Since you said “yes” to my question whether there is any other part to exhibit 7 other than its surface, please show the court the other part you are referring to?
A. The other part will be the documents that management and the Ministry of Finance will share with us on the board.
Q. That documents you just referred to is not part of exhibit 7, is it?
A. No.
Q. Please turn to page 8 of exhibit 7 and read item 5.3 with the heading ‘report from audit committee.” You will agree with me that from item 5.3 of exhibit 7 it is evident that the audit committee of the GIIF board held a meeting on 19 December 2019. Is that not so?
A. Yes my lady.
Q. At that meeting of the audit committee the reviewed the draft budget for the year 2020. Is that correct?
A. Yes my lady.
Q. And at the meeting of 8th January 2020, you represented the draft budget to the board on the invitation of the CFO. Is that correct?
A. Yes my lady.
Q. After your presentation, you asked the board for their comments and approval of the draft budget for the year 2020, and the board granted its approval subject to the CFO furnishing the board with a breakdown of the fund raising expenses. Is that correct?
A. Yes my lady.
Q. This presentation of draft budgets by the Audit Committee was part of its functions and would be usually be performed towards the end of a financial year for the purpose of approving the budget for the coming year. Is that not so?
A. Yes my lady.
Q. Sometimes early in coming year or the next the budget could’ve revised and a revised draft budget or addendum would be circulated to members of the board ahead of a meeting to review and approve of it. Is that correct?
A. Yes my lady.
Q. In January 2019 the CEO circulated an email on an addendum to the 2019 budget estimate presented to the board in December 2018 and 25 January 2019 at 10: 46am and you acknowledged receipt of it on the same day at 3:40pm. I’m going to show you a copy of the email thread and confirm if you remember seeing it. If you need time to go and verify.
Email dated 25 January 2019 at 10:46am from Solomon Asamoah to board members on addendum to budget estimates with three attachments
1. Memo dated 22 January 2019 to the chairman of the audit sub-committee for senior manager, finance through the chief executive officer with the subject ‘addendum to the 2019 budget estimates presented to the board in December 2029.
2. Memo to the chairman and board of GIIF from deputy ceo and CFAO and Snr…. through Solon Asamoah (CEO) on the subject GIIF operational sustainability.’
3. Ghana Infrastructural Investment Fund draft budget estimate for 2019 dated December 2019.
Case adjourned to Jan 22 for continuation.
For more news, join The Chronicle Newspaper channel on WhatsApp: https://whatsapp.com/channel/0029VbBSs55E50UqNPvSOm2z
The post Accra Sky Train was Pipeline Project – witness appeared first on The Ghanaian Chronicle.
Read Full Story
Facebook
Twitter
Pinterest
Instagram
Google+
YouTube
LinkedIn
RSS