Seven Banks To Be Sanctioned

Seven Commercial banks in 2007 failed to disclose their non-traditional export earnings as required by the Foreign Exchange Act 2006 (Act 723). By this, they impeded the effort of the Bank of Ghana (BoG) to effectively monitor foreign exchange proceeds of exporters.

The banks are SG-SSB, Fidelity, International Commercial and Standard Trust. The rest are Zenith, Guaranty Truest and HFC. These are contained in the report of the Public Accounts Committee on the Auditor-General’s Report on the statement of foreign exchange receipts and payment of Bank of Ghana for the two-and-a-half years ending December 31, 2007. The report was moved for adoption in Parliament ton Thursday.

“For the first quarter of the year, seven banks failed to submit returns while four others failed to submit their returns by the end of the second year,” the report said.

“The House should express its strong concern about this state of affairs and demand that BoG applies the necessary sanctions against recalcitrant banks,” the report recommended.

The committee report noted that as a result of the non-compliance, the total foreign exchanges earned through dealer banks and reported by the BoG could not represent the total non-traditional earnings for the period. The committee, according to the report, was informed that a total of $1.84billion (1,841,298.731) dollars) was earned from non-traditional exports from authorized dealer banks for the year 2007.

The Public Accounts Committee’s report, signed by its chairman, Albert Kan-Dapaah, also stated “In the preparation of the receipts and payments, some errors and omissions which have been occurring continue to occur in 2009.”

“In 2007, contractional payments amounting to 5,805,427 dollars in respect of the Osagyefo Barge power project was completely omitted from the statement,” the report said. The BoG understated other payments made to the Ghana International Airline amounting to one million dollars and overstated cocoa receipts of 114,525.27 dollars among other things the report added.

It said when those errors were brought to the attention of management by the Auditor General, steps were taken to correct them. “Members all the same expressed dissatisfaction with the occurrence of such errors in the 2008 Auditor-General’s report”, it added.

The Public Accounts Committee according to the report, recommended to the BoG to strengthen its internal and supervisory control systems over preparation of the statement of Foreign Exchange receipts and payments in order to eliminate errors and omission.

The BoG must noted that a public document of this nature cannot allow for such petty mistakes,’ the report noted addition that where the BoG found that existing measures were not punitive enough the bank must take the necessary steps to amend its laws and regulations to ensure their effectiveness.

Source: Ghanaian Times/Ghana