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14.05.2004 General News

Ghana's bogus $3.5m debt - More revelations

By Chronicle
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KOLON AGENT MISLED VEEP? ... Says he's his brother's classmate and friend MORE REVELATIONS are emerging from the circumstances surrounding the $3.5 million debt imposed on Ghana by an arbitrator in London over a transaction for the supply of spare parts by a UK-based Korean company, KOLON in September 2001.

A report by the Criminal Investigations Department (CID) of the Ghana Police Service tasked to do further investigations into “the KOLON affair” has recommended the arrest and prosecution of Mr. Patrick Adamah, a former employee of the company for acts of commission and omission over the $3.5 million debt imposed on the country, The Chronicle has learnt.

Analysts said they had been baffled by how a mere misunderstanding between KOLON UK and its local agents, Gbewaa Civil Engineers in the spare parts transaction could result in a huge debt to Ghana.

But it is alleged that in order to sideline its local representative for fear of the latter deducting almost $1 million representing compensation for the supply of unwholesome rice KOLON sold to MENSUL Ltd, a sister company of Gbewaa, the Koreans, led by Adamah resorted to lying to top government officials including the Vice President and some national security agencies such as SFO, when NPP came into power in 2001, to achieve his agenda.

Documents sighted by The Chronicle indicted that Adamah also told t an Accra High court that he had never registered KOLON UK Ltd version in Ghana and that he was not aware of the existence of the company in the country.

It also emerged that aspects of the investigations that were being conducted locally by the SFO over the KOLON affair mysteriously found its way into the hands of KOLON in London during the arbitration hearing, which was used against Ghana.

The office of the Vice President has refused to comment on alleged meetings between him and Adamah in 2001 over the KOLON transaction.

Speaking to the paper on behalf of the Vice President recently, Mr. O.B. Amoah, said the matter was subjudice. Besides “ there is no way the Vice President would answer your questions anyway; there is nowhere in the world that you can get a vice president to answer questions as to whether he has received a security report on KOLON or not.”

In February this year The Chronicle filed a questionnaire to the Vice President, Alhaji Aliu Mahama seeking his comment on the meeting held between him and Adamah.

The Chronicle had wanted to cross check its information that Mr. Adamah had reportedly misled the Vice President and other government agents he was referred to discuss the issues with.

Adamah had in an earlier interview admitted meeting the Vice President whom said was a classmate of his brother and had known for a long time.

He denied misleading the VEEP during the meetings to discuss the MENSUL rice compensation and other developments on why KOLON was trying to sideline Gbewaa Engineers, its former local representative.

During the meeting Adamah allegedly made serious allegations bordering on fraud against some officials at the Ministry of Roads and Transport, Ministry of Works and Housing and Mr. Kasule Yakubu, Managing Director of Gbewaa Civil Engineers.

As a result two officials of the two ministries have since been relieved of their posts.

Mr. Yakubu was also subsequently arrested by the CID for further investigations at the request of the national security and the SFO for an alleged insurance claim he had made when the goods arrived in the country and the payments that were made to him by the Ministry of Works and Housing.

It was during further investigation by the CID that they uncovered the involvement of Adamah and his KOLON partners and recommended his prosecution, The Chronicle gathered.

Commenting on the insurance issue The Chronicle's State Insurance Company (SIC) sources said the goods were fully insured by Gbewaa but when on arrival it was detected that there were defects, the company put in a claim, which SIC honoured after experts from Europe had inspected and testified to the damage.

The genesis of the KOLON affair was in 1996 when the Ministry of Works and Housing, the Ministry of Roads and Transport and the Department of Feeder Roads were looking for spare parts for the department's graders and excavators.

The Chronicle gathered that around that time Mr. Kasule Yakubu, whose company used to service the ministries' earth moving equipment said he could arrange with his principals, KOLON UK Ltd to supply the spare parts.

The ministry therefore submitted a list of the parts it needed to Gbewaa for consideration following which Gbewaa tendered a draft contract on behalf of KOLON for the imports.

After weeks of scrutiny the ministries agreed to the terms of the contract including 180 days credit and signed and delivered their portion of the contract to the local representative of KOLON.

However it was not until seven months later that Gbewaa got back to the ministries to say KOLON could not sign its portion as expected because the company was seeking clearance from its headquarters in South Korea.

But later when KOLON sought to supply the goods direct to the ministries but the ministries said NO because there was no such contract between them and also the budget allocated for the goods had been exhausted.

But KOLON's representative agreed to supply the goods on credit instead and also take local currency unlike the original contract that demanded payment in dollars.