¢500m Extortion Deal Exposed

…Revenue Officers Busted For Conspiring To Reduce TV3 Network Ltd's Tax Liability From ¢12.15 Billion To ¢4.61 Billion A conspiracy by some staff of the Internal Revenue Service/Large Taxpayers Unit (IRS/LTU) together with an officer of Customs, Excise and Preventive Service (CEPS) attached to IRS/LTU has been uncovered by the Office of the Auditor-General. Also in the syndicate is an employee of P.O. Andah Associates (Tax Consultants and Practitioners).

Members of the syndicate, who are now in police net, had come together to collect the sum of ¢500 million from the Management of TV3 Network Limited, to reduce its tax liability from over ¢12.15 billion to ¢4.61 billion.

This came to light in a letter which the Auditor-General wrote to the Director/CID, Ghana Police Service, which was intercepted by The Crusading GUIDE last week.

It stated that the Auditor-General, Mr. Edward Duah Agyeman, had examined some documents and made some observations. The first document was Draft Tax Audit Report for 1997-2003 dated July 18, 2005, issued by Large Taxpayers Unit and signed by Alex Asamoah-Bonti (Head Audit Division, LTU) for the Director.

According to the letter, the document showed that TV3 Network Limited owed various taxes amounting to ¢12,156,008,538. There was an indication that the Managing Director of TV3 Network Limited was invited by members of the Revenue Officers to discuss the issues raised in the Report.

The second document – Tax Audit Report on TV3 Network Limited for the years of Assessement 1997 to 2003 dated July 27, 2003, issued by LTU and signed by Alex Asamoah-Bonti, for Director with copies to the Director, LTU, Head, Collection Division and Head, Taxpayer Services – showed that TV3 Network owed ¢8,818,040,857 which was made of VAT - ¢4,782,870,122 and direct taxes of ¢4,515,697,335.

A letter written by the Revenue Officers requested the company's Managing Director to issue two separate cheques in full settlement of the amount within 21 days for the VAT and 30 days for the direct taxes.

Revised Tax Audit Report on TV3 Network Limited for the years of Assessment 1997-2003, issued by LTU and signed by John Defortse, Acting Head, Audit Division, with copies to Director, LTU, Collection Division and Head, Taxpayer Services, was the third document said to have been examined by the Auditor-General.

According to that document, a total of ¢4,610,444,481 – made up of VAT of ¢1,981,715,704 and direct taxes of ¢2,628,728,777 – was owed by TV3 Network.

Two letters were written to the Head, Audit Division by TV3 Network and signed by Roland Ajetunmobi, Acting General Manager, Finance.

The Auditor-General maintained that “there was no logical explanation as to why the total tax liability was reduced from over ¢12.15 billion to ¢8.81 billion and finally to ¢4.61 billion”.

He asserted that he discussed the issue with the Management of TV3 Network Limited who explained that they were not satisfied with the taxes raised and that the matter had been referred to their tax consultants.

According to the Auditor-General, a senior Manager from TV3 Network Limited also informed him that certain officers from the IRS/LTU and others had demanded ¢500 million from his company to reduce their tax liabilities from over ¢12.2 billion to just ¢4.6 billion. “The Management of TV3 Network did not like the idea and that they had already informed the appropriate authorities”. The company indicated it would look into the matter.

Based on the information supplied by TV3 Network, the Auditor-General alerted the police to go and bust the brains behind the conspiracy.

Subsequently, Joseph Dontoh of CEPS attached to IRS/LTU, Joseph Adjei, Senior Collectors/IRS and Eric Duncan, Staff of P.O. Andah Associates were arrested.