Capital Bank Boss arrested

• Posted on April 18, 2018April 18, 2018
• by Nana Kwesi Coomson
• Comment

The Economic and Organised Crime Office (EOCO) yesterday arrested William Ato Essien, the man under whose supervision Capital Bank collapsed, thereby botching the expectations of most people who had invested in that financial institution.

Mr Ato Essien was said to have wept like a child and pleaded to be released.

He was busted to assist EOCO in its investigation into circumstances that led to the collapse of Capital Bank which he founded.

In August 2017, the Bank of Ghana (BoG) announced the takeover of Capital Bank along with UT Bank by GCB Bank for insolvency.

Earlier reports last week had suggested that Rev Fritzgerald Odonkor, CEO of the defunct bank, who was detained for questioning, had been arrested.

But sources said the reverend minister was never arrested.

It was unclear whether Mr Ato Essien was granted bail yesterday, but as at press time, he was still holed up at the EOCO.

He is suspected to have orchestrated the transfer of millions of investors’ funds from Capital Bank into other businesses, including microfinance and other non-bank financial institutions, which he established, bringing Capital Bank on its knees.

One of such institutions is Accent Financial Services at the Airport Residential area in Accra, which could not meet its financial obligations to numerous customers since last year.

He is also believed to have business interests in an insurance company at North Ridge, Accra, water bagging company, real estate, a micro finance company along the Ring Road, among others.

DAILY GUIDE learnt that EOCO is probing all the companies whose directors are his paddies.

Pastor Mensa Otabil was the board chairman of the collapsed Capital Bank, while a medical practitioner, Dr Kwadwo Ahwireng, was the board chairman of the distressed Accent Financial Services.

Background

According to the Central Bank, Capital Bank was extremely insolvent, which meant that its liabilities exceeded its assets, putting it in a position not to be able to meet its obligations.

Despite repeated agreements between the Bank of Ghana and Capital Bank to implement an action plan to address these significant shortfalls, the owners and managers of Capital Bank were unable to increase the capital of the banks to address the insolvency.

Consequently, in order to protect customers, BoG had to revoke the licence of Capital Bank under a Purchase and Assumption transaction.

Earlier Invitations

At the end of March 2018, the former Directors of Capital Bank and UT Bank were invited by EOCO to answer for their roles in the collapse of the banks.

This followed the findings of an investigative report on the collapse which was submitted to the BoG.

Prior to the summons by EOCO, the Second Deputy Governor of the BoG, Elsie Awadzie, revealed that the activities of the top officials of the two banks were under examination.

By Samuel Boadi