Flashback: Secret company owners are ‘hot’, identities to be made publicly accessible

Unidentified owners of unregistered companies came under fire when the Registrar-General’s Department announced that it will clamp down on them provided they do not declare their names and assets.

According to the Registrar General, unveiling the true owners of resources was critical particularly for developing countries like Ghana to enable investors to manage risks and feel comfortable investing in the country.

Vice President Dr. Mahamudu Bawumia said the move also formed part of the measures to curb the growing corruption menace.

Companies that failed to provide information on beneficial ownership were to face prescribed sanctions if caught.

Read the full story originally published on February 4, 2016, on Ghanaweb below

Every company in Ghana will soon have to provide information on who its beneficial owners are, their interests, nationality, residential and postal addresses, their dates of birth, and possibly contact numbers to enable the Registrar-General’s Department to contact them, if need be.

The benefits of such a policy include: reducing corruption risks and deter tax evasion, give government agencies more of the information they need to carry out their mandates, support the work of campaigners, NGOs, investigative reporters and potentially create greater trust by satisfying citizen demand for ownership information, fill knowledge gaps for law enforcement personnel and help investors manage risks and feel comfortable about entering the market.

Unmasking the true owners of resources becomes critical particularly for developing countries like Ghana that are at risk of such negative practices.

Companies which failed to provide information on beneficial ownership would face prescribed sanctions.

As part of measures to curb corruption, Vice-President Alhaji Dr Mahamudu Bawumia yesterday gave the strongest political commitment to provide the needed resources towards fighting corruption with the full implementation of the beneficial ownership regime.

He said government would ensure transparency in the procurement process, awarding of contracts, as well as transparency in the commodity market and prevent any facilitation of corruption in the country as promised by President Nana Addo Dankwa Akufo-Addo during the electioneering period.

Politically-exposed persons

In this regard, he said, detailed information of the identities of politically-exposed persons and their families would be made accessible to the public, but would not compromise their security.

“The Ghanaian recognises the huge financial implications of this commitment to our already constrained fiscal space, however, we are resolved to make the needed resources available for Ghana to put in place an effective and efficient beneficiary ownership regime”, he said.

Alhaji Dr Bawumia said this at the opening of a two-day workshop on Supporting New Beneficial Ownership Transparency Champions in Accra, organised by the Transparency International (TI) in collaboration with its local representative, the Ghana Integrity Initiative (GII).

The meeting brought together key stakeholders from Kenya, Nigeria and Ghana with representatives from civil society organisations, government officials, investigative journalists and law enforcement agencies to increase their understanding and knowledge on beneficial ownership in order to collaborate and plan how to collect, share and use beneficial ownership information to tackle corruption in their various countries.

Beneficial ownership

Beneficial ownership is a term used to describe the natural person who directly and ultimately owns, controls or benefits from a company or trust fund and the income it generates.

The term is often used to contrast with the nominee company owners, who might be registered as legal owners of the asset without any benefits.

Nominees obscure the real company structure and owners. Professional nominees are paid a fee for their services but otherwise have no interest in the transactions.

Nominees can also be family members or friends.

The event was organised as a follow-up of the 2016 Anti-corruption Summit held in London, United Kingdom, in May 2016 to support the realisation of the commitments made by the three countries in establishing public beneficial ownership registers.

Anti-corruption Summit in London

Alhaji Dr Bawumia noted that the Anti-corruption Summit in London was also aimed at moving forward the anti-corruption agenda as contained in the International Anti-corruption Action Plan and Ghana Shared Growth and Development Agenda, as well as the United Nations Convention against Corruption.

He added that government was committed to meeting a number of international obligations regarding the implementation of the beneficial ownership and expressed optimism that government’s partnership with the Financial Intelligence Centre, the Ghana Extractive Industries Transparency Initiative (GEITI) and the EITI standards and Financial Action Taskforce would help in meeting the various beneficial ownership requirements deadlines.

He said the country had made tremendous progress after last year’s summit in London compared to its compatriots, saying, ‘‘We have since organised a consultative workshop on beneficial ownership for state and non-state actors while the Companies Act, (Act 920) had also been amended to make provision for beneficial ownership regime a reality.

According to him, Ghana’s EITI, in collaboration with other civil society organisations, relevant government agencies and other partners, developed beneficial ownership roadmap which had been submitted to the international EITI Secretariat in December 2016 as part of the deadline for all EITI implementing countries including Ghana.

He said the government recognised the huge financial implication to this roadmap and would make the needed resources available so that the country would put in place efficient beneficial ownership regime, he stated.

He commended the Transparency International and its local representative, the Ghana integrity Initiative, for organising the regional meeting to facilitate the process.

He urged the participants to leverage on the choices and experiences of other countries so that they would be fully equipped to contribute to the full implementation of the beneficial ownership regime in their various countries.

Making Corruption Felony

Alhaji Dr Bawumia promised that government would this year, amend key portions of the Criminal Code to criminalise corruption to allow for stiffer punishments as well as pass the Right to Information Bill as part of its commitment to fight corruption and enhance transparency in government.

“Our government has already made it clear that we would be passing the Right to Information Act we will make sure a special prosecutor’s office is set up to prosecute corruption and we would amend the criminal code to move corruption from a misdemeanour to felony”, he said

Right to Information (RTI) Bill

He promised that government will facilitate the passage of the Right to Information (RTI) Bill this year.

Money laundering

Dr Kwame Gyasi, Board Chairman of GII reiterated the role anonymous firms play in laundering and channelling funds concealing behind a veil of secrecy and the need for a regime that would ensure greater transparency in public transactions.

He made reference to evidence from the World Bank which demonstrates that the role such elusive entities play in facilitating corruption and money laundering amounts to more than 70 percent of corrupt cases.

The phenomenon he said, “robs governments in both developed and developing countries of resources that might otherwise be invested in improving public activities and stimulation inclusive economic growth”.

In making reference to the Panama papers, the largest ever leaked of documents from a secrecy jurisdiction covering nearly 40 years of records involving two government official from across the globe, Dr Gyasi emphasized the need for a regime that places more emphasis on transparency and public contracting processes and beneficial ownership information as a major step to curbing corruption .

According to him an open contracting process starting at the planning stage with unique identities to enable the public to trace its life cycle from planning to tender to award of contract implementation and a global beneficial ownership register of companies that the government deals with are two important steps to take in the fight against corruption.

Corruption: Africa not doing well

Mrs Linda Ofori Kwafo, the Executive Director of GII, said countries in Africa were not doing well in the management of corruption and alluded to the recent report by the Transparency International on Corruption Perception Index, adding that the performance of most African countries on reducing corruption had dropped.

She entreated government to implement the anti-corruption polices it promised during the electioneering, including setting up the Office of a Special Prosecutor, implementing the recommendations of the Auditor-General’s report and making a corruption a felony. instead of a misdemeanour as well as avoiding sole-sourcing of government’s contracts and make the procurement process transparent.

He urged government to sanction persons engaged in corruption so that the practice would become unattractive and a high-risk area for people to venture into.