Pastor Otabil, ICGC To Cough Up Ghc 51.6 Million

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Pastor, Mensa Otabil, and the International Central Gospel Church (ICGC) are among 15 shareholders and directors of defunct Capital Bank sued over the collapse of the bank, in 2017.

 

The Plaintiffs Messrs Vish Ashiagbor and Eric Nana Nipah from PricewaterhouseCoopers, said the bank’s collapse was a “direct result’ of defendants’ “‘misgovernance” and “willful” breaches of banking regulations.

 

 

 

The writ of summons named the ‘sins’ of each of the defendants confirmed a financial autopsy report that said the failed bank’s founder William Ato Essien used depositors’ funds as his ‘personal piggy bank’.

 

In one such ‘personal piggy bank’ transactions, Ato Essien allegedly requested for ¢130 million loan to be given to an investment company he is related to, Capital and More Ltd.

 

But the senior management of the bank declined the disbursement which was public funds injected by the Bank of Ghana to save the troubled bank in 2015.

 

Pastor Otabil, a board chairman, allegedly provided a personal guarantee that the loan to the founding CEO’s other company will be repaid.

 

The statement of claim said the money given out in 2015 has not been paid after three years.

 

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The writ faulted the pastor for guaranteeing the disbursement explaining, he was “conscious at all material times” that it was in breach of banking regulations as well as against the “expressed opposition” of the senior managers.

 

That ¢130 million was not the only loan William Ato Essien took from his bank. There was another ¢29.9 million he caused to be granted companies he owned or was related to.

 

He later came for another ¢78.9 million loan.

The CEO who is under criminal investigations has been asked in the writ to cough up more than ¢580 million in shareholder loans he took as well as loans granted to companies he owned or is related to.

 

In another episode of severe and acute culture of mismanagement at the defunct bank, the directors and shareholders allegedly kept ¢482m in “non-existent investments” on their books.

 

The central bank later granted their request for this imaginary investment to be converted into actual loans to be paid by the shareholders.

 

To date, a shareholder, Otabil and Associates, founded by the pastor and management expert, has been unable to pay ¢51.6 million, which is their share of the loan converted from the imaginary investments.

 

Otabil’s church, the ICGC, which was a shareholder in the bank, has also failed to pay ¢51.6m which is also their share of the ¢482m loan.

 

A third defendant, Oheneba Osei-Akoto took a ¢2.42 million loan in December 2016 using his residential property at Regimanuel Gray Estates, East Airport, Accra as collateral.

 

The defendant who is a shareholder has failed to pay back the money.

The plaintiffs said these defendants are responsible for ‘serious financial loss’ at the defunct Capital bank.

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