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13.12.2005 General News

A tale of dubious procurements

By The Sun
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... Formed 2 coys for hospital's contracts By Dominic Jale

CONTRARY TO a spirited attempt to rationalize the phony procurement practice in the nation's number one teaching hospital, The SUN investigations have again uncovered corrupt practices right under the noses of the Hospital authorities. The man at the center of the controversy again in the Korle Bu affair is Dr. Felix Fonder, the Chief Anaesthetist of the Cardio Thoracic Centre, and close associate of Prof. Frimpong Boateng, the Chief Executive Officer (CEO) of the hospital.

Felix Fonder, who is privately known as Ossei Kwabena, in July 2002, formed Preferential Medical Products (PMP) Ltd, and has since been using the company to do procurement and supply for the hospital without going through due procurement process. President Kufuor has made several public pronouncements about how his Government is dealing with corruption through the IMF-inspired Public Procurement Act that is supposed to standardize public procurements. Korle- Bu hospital falls right under this all-important Government policy, which is being undermined at Korle Bu.

Interestingly, the CEO of the hospital about couples of weeks ago lectured at a public forum on procurement practices. Fonder and Fonder Ltd Besides PMP Ltd, Felix Fonder, is also the owner of Fonder Ltd, which is deeply involved in all sorts of procurement deals at Korle-Bu. The Sun gathered that the formation of PMP was borne out of tongue- wagging around the hospital that Fonder was doing procurement, which smacked of a conflict of interest, since he was a top officer at the hospital.

The Sun gathered that in many instances, hospital workers even alleged that Fonder was fronting for Prof. Frimpong-Boateng, the CEO of the hospital. However, Fonder in an interview with the Sun later confirmed that some workers had even approached him over the allegations, which he had debunked, describing them as baseless.

He also claimed that he was not a shareholder of Fonder Ltd and claimed the company was rather formed by his late father. Despite his stance, documents from the Registrar General's Department (RGD), had Fonder and two others as the owners of Fonder Ltd.


When this reporter reached Mr. Fonder early this year, over his role in the formation of PMP Ltd and its involvement in procurement deals at Korle-Bu, he again denied that he was a shareholder of the company. He told the paper that the company was owned by two of his relatives. When his attention was again drawn to the fact that his name, residential address and other particulars that appeared on the Fonder Ltd company registration forms, also featured on PMP Ltd, he said it was not true and denied his residential address was used by any of his relatives for the registration of the new company.

“Two of my relatives who formed the company are elderly people who have their own residences and as a result it can never be true that my residential address was used, it can never happen that way, it is not true,” he told the paper. “They are elderly people who are doing their own businesses how can they stay with me or use my residential address for the formation of their company,” Fonder argued.

He challenged the this reporter to do proper check at the RGD, about the real owners of the two companies, PMP Ltd and Fonder Ltd, and stop speculating. But when his attention was drawn to the fact that the paper was holding documents from RGD, Fonder pleaded with this reporter for a one-on-one meeting. However, a few minutes to the appointed time, he called this reporter and asked for the meeting venue to be held at his office at Korle-Bu.

Even though Fonder was able to mention one of his relatives, as one of the founders of the PMP Ltd, he found it a bit difficult to figure out which of his cousins was the other shareholder as he fumbled with the name 'Mr. Okyere Ossei Kwabena.'

Contrary to his claims however, RGD records have Ossei Kwabena (Fonder's private name), as the owner of the company, as well as his Odorkor Official Town residential address.

Besides, Fonder's family sources hinted the paper that the company was formed by Fonder who have been using his two companies for the procurements and supplies medical items running into billions to the hospital.

The SUN learnt that due to the widespread of the allegations that Fonder was the owner of Fonder Ltd, he decided to outsmart the hospital workers and the public by using his private name Ossei Kwabena, and got the consent of one of his relatives to put up his name on the registration documents just to look like he was another shareholder of the company.

Documents from the RGD, in the custody of The Sun have it that PMP Ltd was registered on July 29, 2002.

The registration documents have Ossei Kwabena's residential address as House Number B.942/20, at Red Gate area at Odorkor Official Town, which is Fonder's residential address.


Between February 9,2004 and April 13, 2004 as part of its dealings, PMP Ltd supplied medical items to the tune of ¢427.5m to the Korle-Bu teaching hospital. On April 12, 2004 PMP proforma Invoice to supply 6000 pieces Dosi Flow (Flow Regulators) at ¢30,000 per unit which the total cost of items to ¢180,million. Next on the list were 2000PCS Chest Tubes with Tropical (CH12/100, CH18/300, CH24/500, CH28/600 and CH32/500) at ¢75,000 each. The hospital therefore paid ¢150M Fonder's PMP Ltd for the supply of 2000Pcs of the Chest Tubes with Tropical. On April 21, 2004 the hospital issued Local Purchasing Order (LPO) number 449554 covering ¢330,000,000 being the total cost of the Dosi Flow and Chest Tubes. Earlier, on February 9, 2004, PMP Ltd was requested to supply Reels Supra Wrap (120kg) at ¢9000,000 each. At the end of the deal, PMP was asked to procure 10 Reels Supra Wrap (120kg), which brought the cost to ¢90,000,000, while LPO, number 528781 was issued to cover the payment.

The hospital again issued LPO number 528782 on February 13, 2004 to cover ¢7.5million being the cost of 100PCS Thoracic Drainage Tubes at ¢75,000 each. The the Sun can report that apart from the issue of conflict of interest, most of such deals never passed through the Procurement Department, but the impression is created that the procurement department sanctioned such procurement.

The CEO of Korle-Bu had admitted on air after early this year that he had sidelined the procurement procedure of the hospital, in order to make some savings for the hospital. However, what is not known is how much these procurements could have cost Korle-Bu if they had gone through competitive tendering to source for their supplies.

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