General News of Tue, 16 May 201715
$2.25bn bond petition is not vote of no confidence in CHRAJ – Ablakwa
The Minority in Parliament says its decision to petition the US Security and Exchange Commission (SEC) over the controversial $2.25 billion bond scandal is not a vote of no confidence in the Commission on Human Rights and Administrative Justice.
Ghana's anti-corruption and human rights body has begun investigating the conflict of interest allegation raised against the Finance Minister over the same matter but even before a verdict will be reached, the minority has filed a similar allegation in the US against Franklyn Templeton, the company at the centre of the bond sale.
Member of Parliament for North Tongu Samuel Okudzeto Ablakwa said while the issues remain the same, CHRAJ may have issues of "jurisdictional challenges" if it were to investigate Franklyn Templeton.
"We have petitioned the Independent Federal Regulatory Body in the US to see if ethical boundaries have been crossed by Franklyn Templeton in the issue of the $2.25 billion bond," he stated.
According to him, the minority's petition to the US body is deemed to have been "successfully filed" and they have been given a reference number.
The Minority has been raising conflict of interest allegations over the transaction described by the Vice President Dr Mahamudu Bawumia as the deal of the year.
In that deal, the Finance Minister, Ken Ofori Atta raised the cedi equivalent of $1.12 billion in 5 and 10-year bonds.
“These activities raised a total of $2.25 billion and resulted in the lengthening of the maturity profile of the instruments available on the domestic market. This issuance represents the largest amount issued by a sub-Saharan African country in a day,” a statement from the ministry indicated.
Interestingly, the money raised would not necessarily add to Ghana’s ballooning debt profile but rather be used to offset part of the existing debt and also for infrastructure development.
According to the statement, the pricing obtained was also consistent with the initial price range of 18.95% – 19.85%. “The issuance attracted a number of global portfolio investors, including a very substantial investment in the 15-year bond by a very well respected global financial investor,” it stated.
The bond sale according to report, was managed by three financial institutions – Barclays, Stanbic Bank and Strategic African Securities SAS.
But the joy that came with transaction quickly gave way when the Minority accused the Finance Minister of cooking up the transaction to favour his family, friends and business partners.
At a press conference, a former Deputy Finance Minister Cassiel Ato Forson says the inclusion of Mr Trevor G. Trefgarne, a director at Franklin Templeton, the institution that bought 95 per cent of the bond smacks of conflict of interest.
Trefgarne is also a Director at Enterprise Group Limited, a company which has Ghana’s Finance Minister Ken Ofori-Atta as co-founder.
The Minority also raised issues about lack of transparency in the deal and failure to give other investors the opportunity to take part in the bond sale.
The Ashanti Regional Youth Organiser of the NDC, Brogya Genfi petitioned the CHRAJ to look into the conflict of interest allegation against the Finance Minister but even before it will begin full scale investigations into the matter, the Minority has proceeded to the US raising conflict of interest against Mr Trevor Trefgarne.
Critics have suggested the double-barreled petition smacks of lack of confidence in CHRAJ by the NDC but Samuel Okudzeto Ablakwa insists that is not the case.
CHRAJ is looking at conflict of interest in Ghanaian law; but SEC is looking at the conflict of interest allegations against Franklin Templeton in the US laws, he explained. With both institutions conducting parallel investigations on the same issue but from difference jurisdictions, it remains to be seen what the outcome of the investigation will be.