Edward Bawa petitions CHRAJ over BOST’s $3m Payment to Springfield

NDC Member of Parliament for Bongo Constituency, Edward Bawa, has petitioned the Commission on Human Rights and Administrative Justice (CHRAJ), to investigate what he calls the unlawful payment of some $3 million to Springfield Energy by top managers of the Bulk Oil Storage Transportation (BOST).

The MP had accused Managing Director of BOST, George Mensah Okley and his deputy, John Kojo Ankoful, of making the payment against the advice of BOST’s external lawyers.

George Mensah Okley is said to have been misdirected by the Director of Finance, Mr. John Kojo Arkoful in paying the said amount between July and August 2018.

“The respondents knew that Springfield did not merit that, but still went ahead to effect payment to them. In line with my duties as a citizen of this nation and in light of the above, I have no option than to petition CHRAJ for an investigation into the matter, and the application of the necessary sanctions.”

“In line with my duties as a citizen of this nation, and in light of the above, I have no option than to petition CHRAJ for an investigation into the matter, and the application of the necessary sanctions,” the petition said.

Mr. Bawa in the petition specifically called on CHRAJ to “investigate all instances of alleged or suspected corruption and the misappropriation of public money by officials, and to take appropriate steps including reports to the Attorney-General, and the Auditor-General resulting from such investigation.”

This petition comes days after Mr. Bawa had called for sanctions against the BOST MD and his deputy, and demanded their interdiction for thorough investigation.

Background

Springfield Energy brought its product to BOST’s tank farm in 2013 October for storage. Part of the product could not be accounted for.

Springfield Energy took advantage of this loss and made a claim $20,226,717.75 which was far more than the actual quantity loss.

At the time when Mr. John Kojo Akoful, now the head of Finance, was the acting M.D. of BOST. On the 18th November 2015, Springfield Energy filed a writ against BOST at an Accra High Court, claiming the following:

• Recovery of $ 20, 226,717.75 for their lost products
• At the Interest rate of 19% from October 2015 till the final payment of the principal;
• Loss of profit of $3,420,000.00

When Mr. Awuah Darko assumed office as the M.D. of BOST, he studied the documents on this case and challenged all the claims of Springfield. He subsequently engaged Ernst and Young Audit Firm to audit the transaction to ascertain the actual quantity of products lost.

Ernst and Young found out that the exact amount of product lost was worth $ 11, 104, 143.2 whic was accepted by both BOST and Springfield agreed and accepted this finding.

A summary judgment was later awarded to Springfield for its claim by the Accra High Court. At this point, Mr. Awuah Darko engaged external lawyers to fight the case. BOST filed a stay of execution at the court to enable them to appeal against the judgment.

The High Court granted it partially and ordered the payment of the cost of actual product lost as ascertained by the auditors and agreed by both parties. This was $11,104,143.29.

On the 20th of December 2016, BOST under Awuah Darko paid the said principal amount of $11,104,143.29 through a five-year term loan from Fidelity Bank.

The remaining unresolved issue of the 19% interest rate being claimed by Springfield on the principal is still pending at the High Court and Court of Appeal.

Springfield in September 2017, under Mr. Alfred Obeng’s tenure as M.D, approached BOST to have the matter settled out of court.

The Head of Finance Mr. John Kojo Ankoful (under whose tenure as acting MD when this product loss was occasioned), and the Head of Legal Department, Mrs. Harriet Amoah negotiated the settlement agreement of $9 million with Springfield.

This was supposed to be the interest on the principal ($11,104,143.29). Alfred Obeng ordered the payment of $4million as part of the $9 million interest payment before the settlement agreement was even signed.

He ordered the payment on the 27th September 2017 without the presence or advice of the external lawyers who were handling the case in court.

The Head of Legal Department, Mrs. Harriet Amoah then sent the Settlement Agreement to the external lawyers for their perusal, and in response, via email, the lawyers advised against further payment to Springfield because in the opinion of the lawyers, was not entitled to an amount of$9 million as the interest payment.

As a result of this advice, the settlement agreement was not executed. BOST made it clear to Springfield that they cannot claim the interest in their products and at the same time loss of profit on the same product.

Source: citinewsroom