GRi Press Review 15 – 04 – 2003
Forensic Audit unveils corruption in Ghana Airways
Another reform ‘break
away’ in the pipeline?
Forensic Audit unveils corruption in Ghana
Airways
Details, which will make every true patriot wince and wonder why fellow Ghanaians should behave in such a reckless manner has even resulted in a recommendation by the Auditors that the then board of Ghana Airway, chaired by Madam Victoria Addy, a member of the last Council of State, the executive of the airline and the Internal Audit staff “should be sanctioned for compromising the watchdog role of the Internal Audit Department and failure to initiate external auditing of Ghana Airways operations accordingly.”
The report, carried by “The Independent”, named the 11 other officers of the airline as Capt. Fordjoe, former deputy CEO (Technical), Joe Browne (Head of Engineering), Bethel Donkor (Head of Legal Services), Prof. Yansah (Former Head of Finance), Adu-Gyamfi (Former Head of Finance), Folson (former Head of Business Development), Boamah, (Head of Commercial), Fred Taylor (Head of Overseas Operations), Atta-Badu (Head of Engineering) and Apaloo (former Board Member).
“The details of the forensic audit show even the untrained management eye that a reckless and wanton dissipation of funds, abdication of responsibility and several other untoward management practices are the cause of Ghanair’s woes.”
The over 400-page document which was prepared by Messrs World Wide Investment Company Limited, an Accra-based consultancy firm, fingers the 12 executives of Ghana Airways for various acts of omission and commission in aircraft acquisition, insurance claims/disbursement, maintenance contracts, aircraft leasing, in-flight entertainment services, loans disbursement, executive remuneration and IOUs, discounted tickets, free rentals and internal audit.
On Aircraft acquisition, the report aid among others that; “Ghana Airways management wilfully acquired two DC9 aircraft from Avensa which were unreliable and the components fit list which were not compatible with DC9 spare parts being held at Ghana airways. This compelled Ghana Airways to enter into spare parts sale and exchange agreement with A.J. Walters.”
The then Ghana Airways management provided no authentic final signed invoices for the acquisition of the said aircraft, according to the forensic audit.
On the acquisition of those same aircraft, the forensic audit states, “the 2DC9s were bought for US$7.65m, but the total of transfers to the suppliers so far identified amounts to US$6.65m. Moreover Folson and Adu-Gyamfi under whose stewardship the aircraft were acquired have given the total acquisition cost at US$5m.”
This obviously shows an unaccounted for difference of US$1.65m and the forensic audit recommends that Capt. Fordjoe, Browne and Quartey should be sanctioned for acquiring unreliable aircraft incompatible with Ghana Airways’ spare parts stock and also assist in ascertaining the actual cost of the aircraft and the difference recovered to Ghana Airways chest.
On the acquisition two DC10 aircraft, the forensic audit states that the aircraft were acquired from Malaysia Airlines at the cost of US$27m, which is significantly above the sourced price from Airclaims International (US$20m) and the US$25m thus resulting in overpayment of 2m.
The recommendation of the auditors is, “E.L. Quartey and
Capt. Fordjoe should be sanctioned for acquiring the aircraft at $2m over and
above the recommended price of the Ghana High Commission in
Joe Browne and Capt. Fordjoe are also to be sanctioned for awarding a contract to Malaysian Airlines to undertake extra works on the two DC9 aircraft without a quotation, resulting in an income loss of US $1.5m to Ghana Airways as the Malaysians refused to release the aircraft with a claim that Ghanair owed them US$2.34m. Ghanair had made a provision of US$250,000 for the extra works.
On insurance claims, the forensic audit recommends that Quartey, Folson, Alex Sykes, Tim Stevens, Boamah and Taylor should be sanctioned and surcharged with the cost of an extended lease of an aircraft from million air.
Quartey and Folson are also to provide details on the
utilization of insurance proceeds, particularly concerning a US$1.5m insurance
claim in the airline’s
In one case, according to the forensic audit, the insurance money should have gone into aircraft acquisition or into acquisition of revenue accounting software, but the management did otherwise.
In another instance, according to the forensic audit, the
Ghanair management under E.L. Quartey misapplied US$5m, part of which should
have been used to settle the debts arising out of the maintenance of the DC9
aircraft at
As a result of the non-payment of the maintenance debt on
the DC9, the aircraft was seized for over 11 months at
The forensic audit also found out that in a clear case of unauthorized expenditure, Capt. Fordjoe, Atta Badu, Joe Browne and E.L. Quartey, caused Ghana Airways to lose US$3.7m for routine C-checks (a form of maintenance checks) on the airline’s DC9 fleet.
In one instance in 1999, a C-check for Ghana Airways’ DC 9-9G-ADT which should have cost US$400 rather cost $777,570, being 87 per cent above the normal service charge.
In another instance, also in 1999, the same check on DC-9-9G-ADU cost the airline $1,463,111 instead of $400,000 representing 252 per cent of the normal cost for such service charge.
All these payments were made to Atitech in contravention of board directives to the said officials to submit C-check quotations from Atitech above the normal C-check cost of $400,000 to it for approval.
Capt. Fordjoe and Quartey are to be sanctioned and surcharged with $6,095.51 for leading a defective DC10 under contract from Clipper Corporation (a special purpose company set up for the deal). $3,465,000 of the amount to be surcharged represents 15 months extension of the lease beyond the contractual period.
The frequency of breakdowns arising from defects on the aircraft let to a total loss of $6,095,157 to Ghana Airways. The forensic audit report said the Auxiliary Power Unit of the leased DC10, which was defective, led to a loss of $62, 101 to the airline, whilst a defective engine thrust reverse fan door on the same aircraft led to a loss of $309,448. The same aircraft caused a loss of $610,959 to Ghanair because of defective AFT fix cowls. - The Independent
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He said many leading members of the NPP have made several
approaches to him, promising him international appointments and money if he
crosses carpet to join the ruling party. Alhaji Mumuni made these allegations
at a press briefing organised by the founder of the NDC, Jerry John Rawlings at
his residence in
Alhaji Mumuni who is also the ranking member on
Constitutional Affairs and Justice described the conduct of the NPP as a
deliberate attempt to break the NDC apart. He described the behaviour of the
NPP as undermining the tenents of democracy and good governance. "If we continue
this way as a nation, then we run the risk of undermining the very process we
fought to achieve", he added. -
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Another reform ‘break away’ in the
pipeline?
"Crusading Guide" investigations have unearthed intentions by some elements associated with the marginalized pro-Obed Asamoah cum Kwesi Botchwey group in the NDC to break away and form a new party if ex-President Rawlings persist in exercising his domineering, divisive hold on the party.
In his recent statement on the unhealthy state of affairs in the party, Dr Obed Asamoah, Chairman of the NDC, partly traced the recent electoral defeats suffered by the NDC party to problems emanating primarily from indiscipline and lack of funds. However, independent political analysts see the party's woes as rather being largely caused by the disunity in the party induced by the founder of the party's overbearing, negative, eccentric influence in the party.
Quipped one highly placed party source who pleaded anonymity: "Whoever says the power struggle between Rawlings and Obed Asamoah is not having its debilitating toll on the NDC is simply behaving like a proverbial ostrich."
According to her, this struggle has broken the unity of the party, leading to indiscipline, apathy, the inability to generate necessary fund for the party to be effective and many others drawbacks.
The source said the Obed-Botchwey group is in a principle against the Rawlings style of running a party which for now lacks the incumbency it benefited from, courtesy its antecedent – the Provisional National Defence Council (PNDC). She said this fact is underscored by Obed’s call for the role of Rawlings to be re-defined.
According to her, the overbearing, erratic and ultra-populist tendencies of Rawlings and his fanatical following have provoked the “reformist group” to the extent that should the ex-President not recede to the background and permit/allow the party to function as a democratic institution, the “reformist group” will not hesitate to form a party outside the NDC to contest the 2004 elections.
“I am an old politician, I have been at this game for ages
and can easily form my party to prove a point – irrespective of my performance
at the elections”, a reform-minded NDC top notch told our roving scouts. – Crusading
Guide
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