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15.05.2008 Business & Finance

Prestea Sankofa Gold Ltd Chair shocked…over company`s indebtedness to Shegelege

By Florence Gbolu - Ghanaian Chronicle
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The former chairman of the Prestea Sankofa Gold Limited (PSGL), Mr. Moses Oduro Boateng yesterday told the Accra Fast Track High Court that he was surprised when he discovered that the company was indebted to Shegelege Company limited.

The former Chairman, who is now the Managing Director of Ghana National Petroleum Company (GNPC), said he never heard of an agreement between the mining company and Shegelege until the agreement was stumbled upon by one of the directors of the company.

Mr. Boateng was testifying in a case brought against PSGL by the former Managing Director of the company, Mr. Joseph Emmanuel Wiafe, who is demanding his severance award from his former job.

He therefore described the action of the plaintiff as conflict of interest.

The plaintiff has sued the company to pay him the sum of US $67,860 as his end of service benefit.

In addition, the plaintiff has asked the court to order the mining company to pay him his Provident Fund entitlement and interest at the prevailing bank rate from June 7, 2006, to the date of the final payment.

Led in evidence by Mr. Yonny Kulendi, Counsel for the company, Mr. Boateng informed the court that the plaintiff consulted and reported to him on operations at Prestea because he was the Chairman of the Board of Directors until 2004, when a new board was constituted while he was still a member of the board.

He informed the court that the relationship between GNPC and PSGL was because the later was a shareholder in the former thus making it a subsidiary.

Holding on to his surprise about the agreement, witness told the court that GNPC engaged the services of Osei Kwabena & Associate to audit the accounts of PSGL.

He continued that in the audit report, it never mentioned Shegelege as a company handling toll treatment for PSGL but only named it as a sister company.

According to Mr. Mr. Boateng, Mr. Wiafe never told him the third party was Shegelege, adding that when Mr. Wiafe was confronted he apologized for not informing management about the deal.

Mr. Boateng further described as unfortunate the failure of Mr. Wiafe to inform the Board of Directors about the agreement with Shegelege Company Limited because it was a mere operational matter, when put to him by Mr. Kulendi.

During cross-examination, witness who has been the boss of the petroleum company for six years, told the court he did not ask about the identity of who the audit report mentioned as the third party.

He admitted that at a point in time GNPC was asked to focus on its core business and withdraw from other non-core businesses, noting that GNPC was in the process of leaving PSGL when he assumed position as the Managing Director.

He however, denied that GNPC was asked to relate to PSGL on divestiture issues.

The court adjourned the case to June 28, 2008, to enable parties file their written address and also fix a date for judgment.

Meanwhile PSGL has countered plaintiff's claims stressing that it was plaintiff rather who must pay them US $269,158.76, being over payment made to Shegelege Enterprise Limited.

They also sought for a recovery of the sum of US ¢236,792,000.00, being unauthorized leave claims paid to G. O. Afoaquah, the company's Administrative Manager and the plaintiff, per the plaintiffs instructions as well as interest at the prevailing commercial rate with effect from December 2005 to the date of final payment.

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