Witness of Collapsed Beige Bank accuses former CEO of making bank his ‘cash cow’

 

The first prosecution witness in the criminal case against the former Chief Executive Officer (CEO) and owner of the defunct Beige Bank, Mike Nyinaku, has alleged that the bank was turned into a ‘cash cow for the accused where customer funds were siphoned at his will.

 

Julius Ayivor, a chartered accountant said the withdrawals were done at the beck and call of Nyinaku himself and his many companies, including The Beige Group Limited.

The proceedings of the High Court held at the last sitting on April 3 was largely centred on one of the prosecution’s case involving a total of GH¢141 million that was allegedly siphoned out of the accounts of 23 customers of the defunct Beige Bank on the instructions of the former CEO.

The funds were allegedly siphoned to The Beige Group Limited, a company wholly owned by the accused person.

Evidence [[ FREE COURSE: Fundamentals of Personal Finance ]]

Two customers, Tobinco Pharmaceuticals Limited and Ernest & Barbs Construction Limited, were cited in Mr Ayivor’s witness statement, as examples of the 23 affected customers.

The first prosecution witness used the case of Tobinco and Ernest & Barbs to explain to the court how the alleged siphoning was done on the accused person’s instructions.

In the case of Ernest & Barbs, the witness alleged the siphoning of GH¢17 million from Ernest & Barbs’ account in January 2018 while an amount of GH¢20 million was siphoned from Tobinco’s account in March 2018, all to the benefit of the accused person and his company, The Beige Group Limited.

Cross-examination  [[GROW YOUR ONLINE BUSINESS WITH THIS POWERFUL PLATFORM ]]

During cross-examination of the witness, the counsel for Mike Nyinaku, Thaddeus Sory, suggested that the evidence provided by the prosecution indicated that customers whose funds were allegedly siphoned from their accounts knew that their funds were being transferred to The Beige Group Limited and also indeed sanctioned the transfers.  [[ FREE COURSE: Fundamentals of Personal Finance ]]

Mr Sory asked: “As the Receiver who investigated, did you find out if those customers were specifically targeted or there was a special reason why their deposits were a subject of the transfers to The Beige Group Limited?”

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In response, Mr Ayivor said: “I do not know if they [the affected customers] were specifically targeted or whether there was a special reason that necessitated the siphoning of their funds. What is apparent from the grand scheme that was perpetrated by the accused person is that once he noted that the customers had a lot of funds in their account, that became an opportunity for the accused person to oversee the siphoning of those funds to himself and his companies”.

In a rebuttal, Mr Sory said: “I am putting it to you that the only reason why these customers had their funds transferred to The Beige Group Limited is because they sanctioned those transfers.”

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Mr Ayivor vehemently disagreed with that suggestion, describing it as a blatant untruth.

“First of all, The Beige Group Limited, which is a company limited by liability, is not licensed to take deposits, neither is it licensed to operate the business of banking and fund management.

“So, there is no way that any of the affected customers would have sanctioned the siphoning of their funds to The Beige Group Limited. The Beige Group Limited is just a holding company with the responsibility of supervising companies owned by the accused person,” he said.

The chartered accountant further explained that The Beige Group Limited had no power and authority to take deposits.  [[ FREE COURSE: Fundamentals of Personal Finance ]]

Mr Sory then asked the witness if he was aware that The Beige Group Limited sourced funds from various sources, including the Beige Bank and from its business, to support the bank’s payment of interest to those customers to which the witness said he was not aware.

“All I know is that The Beige Group Limited, under the supervision of Mike Nyinaku, turned the bank into a cash cow where funds placed by customers were siphoned to The Beige Group Limited and to the accused person at will.”

Account statement  [[GROW YOUR ONLINE BUSINESS WITH THIS POWERFUL PLATFORM ]]

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The counsel for the accused later cited a few instances in the bank account statement of The Beige Group Limited, which had been tendered in evidence, and cited a few instances in which funds were being paid out to some of the affected customers, including Tobinco and Ernest & Barbs.

Mr Sory, for instance, drew the court’s attention to two transfers of GH¢473,000 each, made from the account of The Beige Group and described as “funds transfer from BG to Tobinco Pharmaceuticals Ltd”.  [[ FREE COURSE: Fundamentals of Personal Finance ]]

The counsel, who also tendered through the witness, copies of cheques issued by The Beige Group Limited to Ernest & Barbs and signed by Mike Nyinaku, which cheques cleared on the account of The Beige Group, put it to the witness: “I am putting it to you that your testimony confirms clearly that Tobinco and Ernest & Barbs received payments directly from the Beige Group account, all of which payments represent interest on their investment, which confirm that the customers knew they were dealing with the Beige Group”.

The witness vehemently disagreed with that suggestion, saying: “My Lady, that is not true, and it can never be true. As I stated earlier, all the transfers involving the 23 affected customers were done without their knowledge and express instructions.”

The witness had stated in his witness statement and at the beginning of the cross-examination that The Beige Group Limited was not a licensed financial institution, as such, any suggestion that it (The Beige Group Limited) made interest payments to any of the affected customers could not be true.

Background  [[GROW YOUR ONLINE BUSINESS WITH THIS POWERFUL PLATFORM ]]

Mike Nyinaku was the former Chief Executive Officer of The Beige Bank Limited and on 1 August 2018, Bank of Ghana revoked the banking license of Beige Bank and placed it in receivership. Mike Nyinaku is standing trial on forty-three (43) counts of stealing, fraudulent breach of trust and money laundering, involving the siphoning of a total of GH¢1.2 billion from the defunct Beige Bank between 2015 and 2018, in a case presided over by Justice Afia Serwah Asare-Botwe, a Justice of the Court of Appeal sitting with additional responsibilities as a High Court Judge. He has pleaded not guilty to all charges.

The case has been adjourned to 17 April 2023 at 10am to be held at Financial Court 2 of the High Court

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SOURCE: CITINEWSROOM.COM

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