CEO of Beige Bank has explained to Receiver transfer of customers funds – Witness

State Witness Julius Ayivor has told the High Court in Accra that Michael Nyinaku, Founder and Chief Executive Officer (CEO) defunct Beige Bank explained the rationale behind the transfer of depositors’ funds to the account of a subsidiary company, Beige Capital and Asset Management (BCAM).

The former CEO of defunct Beige Bank Limited has been accused of allegedly siphoning customers funds and is standing trial at the Economic and Financial Crime Division of the High Court in Accra presided over by Justice Afia Serwah AsAre-Botwe, a Justice of the Court of Appeal sitting as an additional High Court judge.

Nyinaku was charged for allegedly stealing GH¢1.21 billion of depositors’ money from the bank and has however pleaded not guilty to 43 charges of stealing, fraudulent breach of trust and money laundering.

Counsel for the accused Thaddeus Sory as part of his cross examination of the witness said there was an agreement between the Beige Bank where customers whose investments came at interest rates above what the bank could sustain were introduced to BCAM which was a fund management company which had the capacity to offer more attractive rates to clients who did not want the low rates being offered by the bank.

This the witness admitted

The counsel again maintained that the Accused had explained to the Receiver, how customers deposits with the bank were transferred to BCAM.

In his answer, the witness agreed adding that, the accused had explained the circumstances leading to the transfers of deposits placed by customers of Beige bank to BCAM, with the knowledge and instructions of the customers.

Me. Ayivor, a Chartered Accountant with the KPMG and a team member of the Receiver, however explained that the statement is not entirely correct because the answer provided by Mr. Nyimaku indicates that yes they (Beige Bank) had an agreement with BCAM, where they will transfer to BCAM deposits that came with a cost that is above the bank’s borrowing rate.

The witness further stated that he (Mr. Nyinaku) did not say they had an agreement with BCAM, where they will transfer customers deposits to BCAM.”

Mr. Sory at this point asked “From your understanding of what the accused (Mr Nyimaku) said, could these deposits come from any other place apart from the bank?”

In his response, the witness indicated that the funds were customers deposits held with the bank and those funds are not the bank’s deposits.

Asked by counsel if his response was in respect of Exhibit AB4, the witness said he (accused) did not state that but that is the fact.

Again asked by counsel to take a look at Exhibit AB4 and tell the court which part of the statement he are referring to, the witness in his response said, it matched what the bank would tell the customer is “we are sorry we can place this investment at that investment rate.”

He added “If the bank so wish it will refer the customer to other entity, the bank wouldn’t take deposit and transfer to another entity owned and controlled by the CEO of the same bank.

The witness added that “If that happens it would siphoning money from the account of that custom to another entity to the benefit of the CEO.

“With all the examples provided when the accounts of the customers were debited the amount of BCAM was credited given BCAM access to those credit.”

He said all those credits were appropriated by BCAM and balance has only over GH¢500,000 and some pesewas from August when the licence was revoked.

Justice Afia Serwah Asare-Botwe, a Justice of the Court of Appeal sitting as an additional High Court judge has adjourned the case to Friday, March 17.