LC not payment, finance ministry letters to BoG only approval for MoH to start application process - Star witness

Alex Mould, former Chief Executive Officer of the Ghana National Petroleum Corporation (GNPC), has provided expert testimony clarifying the nature of letters signed on behalf of the Finance Minister by Minority Leader Dr. Cassiel Ato Forson.

According to Mould, the letters that requested the establishment of letters of credit (LCs) in favor of Big Sea General Trading LLC of Dubai were only the initial step in the process of establishing the LCs and did not constitute payment.

Mould, drawing on his extensive experience in Trade Finance and LC establishment from his tenure at the Union Bank of Switzerland and Standard Chartered Bank in the United States of America, explained that the Bank of Ghana (BoG) or any other bank would not create an LC solely based on the letters written by Dr. Forson. The witness clarified that the only document required for establishing an LC would be the application forms filled out by the applicant, in this case, the Ministry of Health.

Furthermore, Mould emphasised that LCs themselves were not a form of payment. Instead, they served as a guarantee of payment contingent on the occurrence of a specific event.

Reviewing the evidence presented by the prosecution, Mould deemed it "fallacious" to claim that Dr. Forson, by signing a letter requesting the establishment of an LC in favor of Big Sea, had caused financial loss.

Mould further noted that, based on his understanding of Ghana's financial management laws, only the finance minister had the authority to authorise requests for the establishment of the specific letters of credit in question. He added that it was not uncommon for deputy ministers to sign letters on behalf of their ministers.

Dr. Cassiel Ato Forson is currently facing accusations of causing financial loss to the state for allegedly authorising the establishment of an LC in favor of Big Sea without proper authorisation for the supply of 30 ambulances.

YNA/WA