William Ato Essien, the founder of the now-defunct Capital Bank.
William Ato Essien will serve 15 years in prison unless he can come up with a sum greater than GHC50 million.
He is the first significant player to be imprisoned in the banking sector cleanup.
Essien has been fighting in the courts for his freedom for many years. He fought accusations that he used Bank of Ghana liquidity support improperly for his own Capital Bank, putting the savings and money of several customers at serious danger.
On Thursday, October 12, 2023, a judge condemned him to 15 years in prison, but what specifically did he commit that day?
His Offenses.
William Ato Essien, the founder of the now-defunct Capital Bank, pleaded to embezzlement and money laundering in December 2022. The court was about to announce its decision at the moment this happened.
What The law Says.
The Courts Act of 1993 (ACT 459), Section 35, governs this system. It states that when someone is accused of committing a crime that has caused the state financial loss, hurt, or damage, they must notify the prosecutor that they admit to the crime. Such a person must promise to make up for the loss with compensation. The prosecutor must take it into account and decide if it is adequate.
If the prosecution rejects the offer, the court will continue to hear the case. However, if the prosecution accepts the offer, the prosecutor must inform the court in front of the accused so that it can decide whether the offer of compensation, restitution, or reparation is acceptable.
He admitted his guilt and told the judge he would pay the state GHC90 million back. With an additional promise to repay the GHC60 million in 3 installments of GHC20 million each, GHC30 million was paid upfront. The court stated that the initial payment of GHC20 million was due by the end of April 2023. If he doesn’t pay, the entire GHC60 million is owed, or the court sentences him to custody.
If it determines that the evidence is sufficient, it will accept the accused’s plea of guilty and find the accused guilty based only on his own admission of guilt. Following that, a payment order will be issued, and if there is a default, the court will continue to sentence the accused to incarceration.
The Information Presented to The Court
Capital Bank’s largest shareholder was William Essien. The bssien caseank received a total of GHC620 million in liquidity support from June 2015 to August 2017 to help it fulfill its capital adequacy ratio and service its maturing loan obligations.
He ordered the transfer of GHC120 million from the liquidity support amount to investment management and consulting firm All Time Capital Limited (All Time) in October 2015. While GHC20 million of the GHC120 million that had been given to All Time was transferred to Pronto Construction and Supplies Limited (Pronto Construction), the remaining GHC100 million of the GHC120 million that had been paid to All Time was transferred to MC Management Services.
The GHC20 million transferred to Pronto Construction was used by the managing director of Pronto Construction, ostensibly to buy shares in Capital Bank, while the GHC100 million transferred to MC Management Services was subsequently represented to the Bank of Ghana as initial capital of Sovereign Bank.
Once more, GHC65 million of the GHC620 million BOG liquidity support was handed to Nordea Capital Limited, referred to as an investment bank. GHC30 million of the GHC65 million will be given to MC Management Services, which the BOG was told would serve as additional beginning capital for the Sovereign Bank.
The remaining GHC35,000,000 of the GHC65,000,000 was deposited into a Brietling Services account at Fidelity Bank, a business that Ato Essien had founded. The GHC35 million that was deposited into Brietling Services’ account was later transferred to Capital Africa Group, a business owned by Mr. Essien.
The GHC130 million that made up the initial capital of Sovereign Bank was ultimately transferred to Mr. Essien’s company, Capital Africa Group. The funds placed into Capital Africa Group were ultimately lost by Mr. Essien and another defendant who was ultimately cleared of all charges after the trial.
A total of GHC27.5 million of the liquidity support, which was delivered to Ato Essien in jute bags and ostensibly utilized as payment for business development, was appropriated by him between June 2015 and October 2016.
In June 2017, he ordered the payment of GHC100 million into a Capital Bank account held by the managing director of the three companies listed below: Maripoma Enterprise Limited, Hardwick Limited, and Volta Impex Enterprise Limited. This was done in order to facilitate the conversion of some of the GHC620 million liquidity support. The managing director of the three businesses was supposed to use the GHC100 million as payment for 30% of the shares in Capital Bank.
He convinced the managing director of the companies to submit copies of government payment certificates for the three (3) companies, valued at GHC135 million but discounted by Capital Bank to GHC105 million, to be used as collateral for the alleged loan of GHC100 million in order to conceal the conversion.
The Managing Director’s Capital Bank account had earlier received GHC100 million, of which GHC70 million was transferred to another accused person who had also been found not guilty in court.
