The Ghana National Petroleum Corporation (GNPC) has acquired additional documentation on a US$7.5 million residential property in Chapel Hill, a suburb of Takoradi in the Western Region, which reveals that the Corporation’s boss paid for the building under “unusual” circumstances, according to The Herald.
Dr. Kofi Koduah Sarpong, the GNPC’s Chief Executive Officer (CEO), wrote a note sanctioning payment for the damaged facility on December 29, 2017, the same year he took over as the head of the state organization, saying, “I am taking this unprecedented measure in view of the seriousness of the matter.”
However, the GNPC Chief Executive has been chastised in a report by the Public Interest and Accountability Committee (PIAC), which claims he “acted in violation of the laws governing conflict of interest” in the US$7.5 million deal.
Another section of the CEO’s document, sent to the Chief Finance Officer and copied to the Manager Accounting and Reporting, Corporate Finance Manager, and Audit Manager, stated that critical documents were not cited at the time Global Haulage Company Limited was paid.
“The documents are in the custody of our Legal Officer Ms Ama Awuah-Kyeremanteng who unfortunately is now out of town to furnish them to support the payment,” Dr Sarpong stated emphatically in his memo titled “acquisition of residential properties in Takoradi.”
While many insiders have labeled the US$7.5 million agreement as unusual, the PIAC investigation went on to accuse GNPC management of “non-compliance with the Procurement Laws of Ghana in that there was no public tender or bid,” according to the study.
Dr Sarpong’s last employer, Global Haulage, was also the owner of the now-defunct Royal Bank, where he served as Board Chairman until Boakye Kyeremateng Agyarko, then acting as caretaker Energy Minister, appointed him Acting CEO, despite the fact that he had passed the mandatory retirement age of 60.
According to reports, some members of the GNPC boss’s family, including his son, were involved in the “Purchase of property consisting of six blocks of residential housing units with ancillary properties on plot #18 RAF Chapel Hill Takoradi” transaction, which was described as the “Purchase of property consisting of six blocks of residential housing units with ancillary properties on plot #18 RAF Chapel Hill Takoradi.”
“The Board of Directors at its meeting held on the 11th November 2017 approved the purchase of Global Haulage Property at Chapel Hill in Takoradi for a sum of US$7.5 million,” the CEO wrote in the memo (Seven Million Five Hundred Thousand US Dollars).
“I can confirm that the underlying Sale and Purchase Agreement with the seller has been completed.
“Our Legal Officer, Ms Ama Awuah-Kyeremanteng, has the documentation, but she is now out of town and cannot supply them to support the payment.”
“By this memo, I authorize you to make an immediate payment to Global Haulage Company Ltd, the vendor, as per their attached invoice.”
“Because of the urgency of the situation, I am taking this extraordinary measure.”
“Suffice it to say that once full office work resumes on January 8, 2018, a thorough post-audit of the transaction can be completed.”
“I want to make it clear that I, the Chief Executive, am solely responsible for this transaction.”
Interestingly, when PIAC demanded that the GNPC management produce “full” information on the transaction, including a set of minutes in respect of the transactions, the GNPC management instead offered meager and chosen “extracts.”
The property was held by the late Alhaji Iddrissu Adamu aka Alhaji Global.
The Herald has seen photos of the US$7.5 million facility, which reveal that GNPC is investing more money to make it habitable. It is unknown how much money the state-owned institution’s management spends.
It’s also unclear whether the property was inspected before the payment by the Freddie Blay-led board.
The date on the PIAC paper is July 3, 2020. It was written by the Legal Sub-Committee of the committee.
The Herald was unable to determine whether anyone from GNPC had occupied the US$7.5 million property as of last Thursday.
It’s unclear why, despite insisting that the sale and purchase transaction “was unlawful as it fell afoul of SS 14, 21, 35, 43, 47, 69 of the Public Procurement Act, 2003 (Act 663) as amended by the Public Procurement (Amendment) Act, 2016 (Act 914),” PIAC has not sought any punitive action against the management of KK Sarpong since 2020.
The PIAC is an independent statutory agency tasked with promoting openness and accountability in the management of Ghana’s petroleum earnings, and this study confirms the rot at the GNPC under the KK Sarpong-led management, which the Akufo-Addo government has been ostriching over.
Prof. Albert Fiadjoe, the committee’s chairman, Noble Wadzah, Rev. Dr. Kwabena Opuni Frimpong, Nana Agyenim Boateng, Prof. Adom-Frimpong, Osei Kwadwo Boateng, Nasir Alfa Mohammed, Isaac Dwamena, and Marilyn Aniw prepared the 5-page report.
Prof. Figdjo’s term expired shortly after the report, but his replacement, Prof. Adom Frimpong, seemed uninterested in the results, despite having been a member of the earlier panel that probed the problem.
Clara Beeri Kasser-Tee has replaced Professor Akosua Darkwah as the representative of Independent Policy Research Think Tanks, while Odeefuo Amoakwa Buadu VIII has replaced Ogyeahoho Yaw Gyebi II as the representative of the National House of Chiefs.
Professor Kwame Adom-Frimpong of the Institute of Chartered Accountants of Ghana (ICAG), Nasir Alfa Mohammed of the Ghana Bar Association (GBA), and Bashiru Abdul-Razak of the Ghana Extractive Industries Transparency Initiative have all been re-nominated (GHEITI).
The GNPC’s purchase of a residential property on Chapel Hill in Takoradi for US$7.5 million had been submitted to the Legal Sub-Committee for a final report by the committee in a virtual meeting held on June 18, 2020, from the PIAC Secretariat, according to the statement.
The Committee referred this topic to the Legal Sub-Committee at its Emergency Meeting on August 31, 2018 at the PIAC Secretariat, and the Sub-Committee subsequently submitted a report to the Committee on the matter.
The current reference requires the Sub-Committee to consider whether it was necessary to review the conclusions previously reached by the Sub-Committee on the matter to the Committee in Plenary in light of the Coordinator’s Validation Report held by PIAC and GNPC at the offices of GNPC on this matter.
It was revealed that a previous recommendation of the Legal Sub-Committee, dated 15th May 2019, had submitted a report on the matter recommending that the sale and purchase transaction was unlawful as it ran afoul of SS 14, 21, 35, 43, 47, 69 of the Public Procurement Act, 2003 (Act 663) as amended by the Public Procurement (Amendment) Act, 2016 after painstaking deliberations and consideration (Act 914).
“The CEO of GNPC operated in violation of the regulations governing conflict of interest,” according to the report.
“Whether or not there was a need for a value-for-money audit of the GNPC transaction?” was one of the questions raised in the prior report. However, because this was not a legal problem, the Sub-Committee on this opted to refer the matter to the plenary for a decision.
“Whether or whether there was a conceivable breach or breaches of the law on the face of the transaction?” was another question explored. The findings and observations were made in this regard.
“There was non-compliance with the Procurement Laws of Ghana in that there was no public.tender or bid,” he said, adding that GNPC “showed substantial non-compliance with the requests to provide the complete set of minutes in respect of the transactions, opting to provide scant and selective “extracts.”
Although “the CEO of GNPC is alleged to have recused himself from the discussion of this transaction,” other parts of the story stated that “the CEO of GNPC is said to have recused himself from the discussion of this transaction.” Only a complete set of minutes, which GNPC has failed to produce, will be able to substantiate this assertion.”
Regardless of the CEO’s recusal, he took “…all responsibility for this transaction” by ordering payment at a time when there was no proof of necessity, urgency, or any other competing offer in the works. If the CEO had recused himself, he should not have participated in the proceedings.”
PIAC and GNPC hold a validation meeting.
“About a year after the Legal Sub-Committee submitted its report on this matter to the Committee, the Committee in Plenary resolved at a meeting on the 18th June, 2020 to seek final responses from GNPC to the conclusions the Legal Sub-Committee recommended to the Committee per a report dated 15th May, 2019,” it stated.
“This was to enable the Committee to bring this subject to a conclusion,” it explained.
As a result, on Wednesday, June 17, 2020, a delegation of the Committee led by the Chairman, Mr Noble Wadjah (with Nasir Alfa Mohammed) and the Coordinator of the PIAC Secretariat, Madam Marilyn Aniwa (with Mr Isaac Dwamena) met with senior officers of the GNPC led by the C.E.O., Dr. Kofi Kodua Sarpong (with Dr. Kwame Baah-Nuako and Dr. Patrick Kwa
Mr Noble Wadzah, the Chair, reiterated the Legal Sub-conclusions, Committee’s to which Dr Kofi Kodua Sarpong responded, emphasizing that he did not agree with PIAC’s conclusions, claiming that he could not be held liable because the Public Procurement Act, 2003 (Act 663) does not cover the purchase of real estate, and that GNPC had not broken any of the Act’s provisions.
Dr. Sarpong also attempted to place blame on the Freddie Blay board of directors, claiming that “he recused himself and the Board of Directors approved the deal.” As expenditure officer, he was responsible for carrying out the Board’s decision in accordance with corporate governance norms. This explains why he approved the property’s payment.”
“He had to accept responsibility for the payment at that time because the vendor (his previous employers) was exerting pressure on GNPC and the lawyer in charge of the transaction was not available,” Dr Sarpong told the Mr Noble Wadjah committee.
He further stated that “no pre-audit was performed before payment was made.” However, the transaction was later subjected to a post-audit. If PIAC requests it, the post-audit report may be made available to them.”
“Renovation works on the property have been completed but it has yet to be turned over to the Corporation,” Dr Sarpong alleged. On Thursday, June 18th, the full Board minutes will be made accessible to PIAC so that it can consider its conclusions.”