Beige Bank case: Nyinaku has not benefited in anyway of GH₵6M transferred from FASL to DYI - Former CFO maintains

The former Chief Finance Officer (CFO) of DYI, a subsidiary of 'The Beige Group,' has insisted and maintained that the founder of the defunct Beige Bank, Michael Nyinaku, "has not benefited in any way" from an amount of GH₵6 million transferred from First Africa Savings and Loans (FASL) to DYI.

"My witness statement has stated categorically that he has not benefited in any way," Sylvia Lawson, the former CFO, a Chartered Accountant by profession, told the High Court in Accra while undergoing cross-examination from State Prosecutors.

Mrs. Evelyn Keelson, a Chief State Attorney, had put to the former CFO that, "contrary to your evidence given, I am putting it to you that the accused person (Michael Nyinaku) is the only person who stood to benefit from all this transaction, that is, the transfer of the total of 6 million Ghana cedis from the FASL account to DYI, which is owned by him."

However, the Seventh Defence Witness, while affirming her earlier testimony, responded, "I disagree with you that the accused person is the only one who has benefited from the GH₵6,000,000 transferred to DYI."

In her Evidence-in-Chief on May 29, 2024, the Witness told the Financial and Economic Division of the High Court in Accra, presided over by Justice Afia Serwah Asare-Botwe, that "not a cedi out of the GH₵6,000,000 was ever paid" to the founder of the defunct Beige Bank, Michael Nyinaku, "neither personally nor in his capacity as a Chief Executive Officer (CEO)."

She explained that the funds transferred from First Africa Savings and Loans (FASL) to DYI were utilized in accordance with DYI operations.

Ms. Sylvia Lawson also said, "all the disbursements made by DYI were in furtherance of DYI's normal business activities."

Mr. Nyinaku, the founder and Chief Executive Officer of the defunct bank, has been charged with allegedly stealing GH₵2.1 billion of depositors' money from the bank.

He has since pleaded not guilty to 43 charges, including stealing, fraudulent breach of trust, and money laundering, and has been granted bail.

Find below the full proceedings of cross examination of DW7 by Mrs. Keelson for the prosecution:

Q: The accused person was the CEO of DYI as in your employment contract that is Exhibit 104, is that correct?

A: Yes, however that was before DYI started its operations. Subsequent to the appointment letter he engaged a Managing Director in the name of Michael Adjei.

Q: Are you aware that the accused person was or is a director of DYI

A: I am not aware.

Q: Are you aware that DYI is wholly owned by the Beige Group?

A: Yes I am aware.

Q: And are you aware that the Beige Group is wholly owned by the accused person

A: That I am not aware because in the course of my employment I have not seen any document to prove that.

Q: But you are aware that the accused person was a director and CEO of the TBB?

A: Yes, that was a working knowledge we had because some information come to staff during our work. However, I will like to say factually that I never dealt with the accused as the CEO of the Beige Bank.

Q: From Exhibit 105, the DYI operated at the same location as the Beige Group, it has the same address.

A: This address is the registered address of DYI but the operations were carried out from an office at North Legon.

Q: So, the DYI had the same registered address as the Beige Group, is that correct?

A: That is correct.

Q: From the documents you have tendered in court, there is no evidence that DYI acquired shares in Pillpoint?

A: Yes, it is true. The documents I have submitted does not show that DYI acquired shares but Pillpoint was owned by DYI if given time I can make the registration document available.

Q: You were the company secretary of Pillpoint?

A: Yes, I was.

Q: Paragraph 11 of your witness statement, you showed emails which shows clearly that the request for 3 million cedis was made to the accused person just by email and nothing more?

A: Yes, it was emails that we were using for official communication and you can see that my email is always not addressed to him alone but his finance team as well as it was sent to the boss and the people who made decisions as well.

Q: The email did not contain any justification for the request for 3 million cedis from the accused.

A: So, before such requests are made for any amount as huge as that, normally we had meetings, there are documentations that had already been shared with officials of the Beige Group. Most of the amounts that were given us were used in acquisitions for the pharmacies. So, before the amount are disbursed or requested for in advance, we have already had series of meeting and gotten approvals for all the acquisitions and the disbursement that we were making, therefore the email goes formally as documentation electronically for the amount we were requesting for.

Q: You have not made any reference to any documentation in the email and you have also not made available to this court any such documentation?

A: If you look at my Exhibits that I have presented to the court, you will see that the bookkeeping or the recording of those transactions reflects the nature of those funds that were received. We have taken time to post those accounting entries to record all the receipt from the Beige Group as a liability in our books so that goes to firm up that these amounts were not that the Beige Group gave to DYI just bye CFO sending an email. Also, in the books of DYI those amounts stand as monies due to the Beige Group. We have also gone ahead to share with the court how those amounts were disbursed and the proper accounting entries posted to that in our accounting books.

Q: The request for the huge amount of 3 million cedis was made without a justification document and this was possible just because the accused person was in control of all the companies involved in this transaction?

A: I disagree with you because when it comes to DYI where I have control over my functions, I know that he does not make sole decisions on our finances. I am not privy to how the Beige Group operates their finance fi=unction but from my perspective at DYI we follow a procedure where before requests are made, we meet with the finance team. Most of the time the accused is not even part of the team, we sent our documentation to the finance and as to how approvals are given before disbursement are made to us, I cannot speak to that.

Q: You are aware from the DYI bank statement you have tendered in evidence (Exhibit 107) that throughout the time you were there, not even one Ghana cedis came as revenue for any service the company may have rendered or any returns on any investment into the account rather all the funds came from TBG and FASL.

A: Yes, I agree with you that no funds came from any other source than the Beige Group and it is rightly so because TBG set up DYI. TBG is the shareholder of DYI so it is the shareholder who will finance its start up also from my witness statement I indicated the objective for the set-up of DYI. DYI was set up to also acquire investment in the health sector and DYI was a startup same for Pillpoint and so for the period in question, it is the shareholder who will invest in the initial operation and start up of the new business. DYI was not directly engaging in business activities that will earn it revenue at the time.

Q: your claim in paragraph 12 your witness statement that TBG borrowed funds for FASL is not supported by any loan agreement because non-exists.

A: As I have stated earlier, transactions between TBG and FASL is not in my domain. How TBG arranged the monies from FASL ahas nothing to do with me. When DYI was credited with our funds from the Beige Group that we had requested as stated in my witness statement, I saw that these funds were credited to us from the accounts OF FASL. So I asked the CFO of the Beige Group and he told me that the funds were arranged from FASL and for me that is it and to whether there was any documentation, it has nothing to do with me.

Q; Contrary to your claim in paragraph 12 FASL was never subsidiary of the TBG, was specialized deposit taking institution regulated by BOG.

A: I think this is information you are now giving me because as I stated earlier, I was told in the normal course of my operation as CFO of DYI that FASL was a subsidiary of TBG, I did not sight any registration document because it was out of my scope of operations and so if you are not telling me that it was not a subsidiary then thank you for that information.

Q: The DYI never intended to pay back these monies it received from FASL because they were free monies with no agreed interest or terms on record.

A: I am finding it hard to believe or accept why we are still going on the back and forth on DYI.

Type from the recorder

Q: The DYI never intended to pay back these monies it received from FASL because they were free monies with no agreed interest or terms on record.

A: DYI has never gone to FASL for financial support. We go to our shareholder for financial support. In any case, our shareholder I believe could have gone to any other financial institution to get funds for DYI but that is in the domain of the shareholder, whether there was a loan agreement with agreed interest, I would not know. Then with the funds that our shareholder gives us, looking at how it was recorded in our books, I do not think that it indicates that DYI had no intention to pay back to TBG. DYI does not owe FASL.

Q: But you saw from the documents you have presented in court that the money came from FASL account to DYI, is that correct

A: That is correct.

Q: All the documents you have presented in Exhibit 108 series confirmed that Pillpoint applied the funds it received from FASL for Pillpoint own pharmaceutical operations such as the payment of salaries and buying medicine for sale.

A: Yes, that is correct. Pillpoint used the funds from DYI which also came from FASL for their operations which includes the payment of salaries, purchase of medicines from wholesalers, purchases of pharmacy licenses, payment for the licenses for the pharmacies that operates the various shops amongst others.

Q: Contrary to your evidence, I am putting it to you that the accused person is the only person who stood to benefit from all these transactions that is the transfer of the total of 6million Ghana cedis from the FASL account to DYI which is owned by him?

A: I would want you to elaborate on the kind of benefit you are referring to.

By Court: The witness is directed to answer the question.

Q: My question is, contrary to your evidence given, I am putting it to you that the accused person is the only person who stood to benefit from all this transaction that is the transfer of the total of 6 million Ghana cedis from the FASL account to DYI which is owned by him?

A: I disagree with you that the accused person is the only one who has benefited from the GH6,000,000 transferred to DYI. My witness statement has stated categorically that he has not benefited in anyway.

Q: In Exhibit 106 you showed huge payments made to Mobacom i.e. items 1 and 9, are you aware that Mobacom is another company owned by the accused person?

A: Yes, Mobacom is also one of the companies under the Beige Group umbrella.

Q: Mobacom’s operations had nothing to do with Health care or pharmacy?

A: Mobacom at the time is operating in the distribution of air-time.

By Court:

Q: Mobacom’s operations had nothing to do with Health care or pharmacy?

A: Directly on face value you will say Mobacom had nothing to do with health care however, as my witness statement stated earlier, the pharmacies were also operating as agency for the Bank. In that respect some of the operations were mobile money and that is how come Mobacom was linked with the pharmacy.

Q: Contrary to the answer you just gave, from your paragraph 27, this is not what was happening, you indicated that it was strategy you developed and hoped to achieve in the long term, so it is not true you were doing anything like that.

A: In my witness statement what I referred to was the teller implant where you have a staff of the bank planted at the various pharmacies but this are services that are provided at the Mobacom service by staff who are not staff of ….

Q: Your paragraph 27 was specific into pharmacy and had nothing to do with tellers.

A: Yes the paragraph 27 speaks about investing in pharmacies and nothing to do with tellers but if you take a modern pharmacy, you will find that not all product on the shelve are medicine. Pharmacies provide other activities or other service that will increase the footfall to the location and airtime, data and mobile money draws people to a location.

Q; The only reason why these payments were made to companies like Mobacom was because the accused person requested for same to be made.

A: No that is not the case. When DYI started its operations and the vision of DYI was shared with us as management staff, we decided to work with other subsidiaries of the TBG of course with approval coming from the finance team of TBG. For example, we needed Pillpoint to be listed as one of the companies that will benefit from insurance, we realized there was Beige care and so our first pint of call was to roll out our partnership with Beige Care not because the accused insisted.

Mrs. Keelson: My lady that will be all for the witness.

By Court: Any re-examination?

Mr. Ampiaw: No my lady.

End