Pressure mounts on BoG to prosecute staff involved in banking rot

Dr. Ernest Addison, Governor, BoG

As the sanitization of the banking sector continues aimed at promoting investor and depositor confidence and increasing the industry’s capacity to finance economic activity, reports concerning Bank of Ghana’s (BoG) staff who were complicit in the recent rot has been given very little priority.

The president Nana Akufo-Addo and Governor of the central bank, Dr. Ernest Addison, since the rot was uncovered, have consistently reiterated at some various functions that those found guilty will not be spared but no concrete action appears to have been taken against those identified as complicit so far.

In August 2018, the Central Bank established an Office of Ethics and Internal Investigations to probe the various roles some of its staff played leading to the collapse of several indigenous banks.

Investigations into the alleged misconduct by some staff of BoG commenced thereof after the people involved in the act were identified.

However, reports indicate that such BoG staff have simply been transferred to different departments, ostensibly to prevent them from carrying out such activities again. The expected dismissals and prosecutions have not taken place.

Public policy commentators and analysts lament that the current position of the central bank leaves much to be desired. Instructively, no information concerning the said implicated staff was given during a recent press conference held by governor of BoG on the state of banks which have met the Gh¢400 million minimum capital requirement.

Pressure continues to mount on the BoG to take action against its staff which it admits it has identified as being complicit in the various irregularities and cases of outright malfeasance. The bank is now being accused by some critics as attempting to cover its guilty staff by sweeping their actions under the carpet.

Cost of banking sector clean up

The banking sector clean-up has cost the state about Gh¢11 billion in bonds issued by government to GCB Bank and Consolidated Bank. This respectively have acquired the liabilities and selected assets of the nine indigenous banks which have had their licenses revoked – to cover the gap between the deposit liabilities and the remaining good assets of the failed banks, which form their respective capital deficits.

It was expected that tax payer’s money used to cover the cost of financial malfeasance by some failed indigenous bank owners and managers, would be recovered from prosecution of those accused and subsequent seizure of their assets. This too has not yet happened, further intensifying the anger of the public against complicit central bank officials.

By Dundas Whigham