Hanna Tetteh cited in ¢800,000 financial loss to state

The Judgement Debt Commission report has implicated former Trade Minister Hanna Tetteh in causing the state a financial loss of over 800,000 cedis.

Government paid New World Investments Limited 2.5 million cedis in settlement after the firm went to court demanding 4.3 million cedis from the Ghana National Procurement Agency (GNPA).

The payment was made on the orders of the minister but the commission says the company deserved a lesser amount.

The GNPA is a government-owned company that imports essential commodities in large quantities for sale to consumers at affordable prices. It is an agency under the Ministry of Trade and Industry.

The facts of the case are that the GNPA took a one million Ghana cedis loan (One billion old cedis) from Investment firm, New World Investments Limited to import sugar.

It paid back 550,000 cedis, leaving 450,000 cedis outstanding because the deal went bad. In 2007, the investment firm obtained a 1.127 million Ghana cedis judgment debt against the GNPA.

The money was not paid until New World Investments went back to court in 2010, asking the court to sell off GNPA’s headquarters building to defray the debt.

The investment firm claimed the debt had risen to 4.3 million cedis at the time. That was when Hanna Tetteh intervened.

She secured an out of court settlement of 2.5 million cedis, which the Finance Ministry paid.

When GPNA officials appeared before the Judgement Debt Commission, they insisted New World Investment Company deserved only 1. 6 million cedis. The commission agreed.

“The then Minister of Trade Ms. Hanna Tetteh under whose supervision GNPA falls, later intervened and had the matter settled out of Court leaving in its trail a judgment debt of GHc2.5 million (i.e. 25 billion old cedis); which the Ministry of Finance was made to pay to the plaintiff,” the report said.

“The settlement amount (of 2.5 million cedis) was arrived at without using any formula. It was imagined without any basis. This settlement made the State to incur an extra debt of GHc876, 080.16 which would not have been paid if the Ministry had allowed the case to take its normal course. It was the taxpayer’s money that later became the victim of the misjudgment and wrong actions and/or inactions of some few public officials,” the commission’s report added.

“In this particular case, because of the interference by the Minister of Trade, the Ministry of Finance was made to pay over and above a debt that the GNPA Limited owed without any commitment to pay back same into the consolidated fund,” the report said.

The commission fell short of recommending sanctions against the minister, but recommended officials at the GNPA be surcharged for the amount lost.

“Again, the judgment debt that the State paid for and on behalf of GNPA Limited (i.e. GNPA) should be charged against the accounts of the Company. The officials who took that decision to use the loan meant for the importation of sugar to augment the capital of the Company should be surcharged for the loss incurred by the State. They should also be made to account for how the loan was utilized,” the report said.

The commission is also asking government to go after officials of New World Investments Limited for unpaid taxes on the amount.

“When the Commission wanted to know from the CEO of Plaintiff/Company whether her company did pay tax on the sum of GHc2.5 million that the Ministry of Finance paid to it as GNPAL’s indebtedness, she answered in the negative,” the report said.

“It is therefore recommended that the tax authorities should pursue the Plaintiff/Company, namely; New World Investments Limited (now New World Securities Limited) and carry out a thorough audit on the Company to find out whether the Company declared the amount in their annual Company accounts for the appropriate tax to be levied on the amount received,” the commission added.

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