Accra - What J.A.N.O Larbie told the Governor On 16th December 1999, our Mr. S.D.K.N. Gavor called at my office. He informed me that he had received a credit of US$1, 500,000 on behalf of an auntie and that he wanted cash. He said he had approached me to have the cash paid as Mrs. Angela Mensah [of the Foreign Exchange Unit (FEU)] had requested for an authorization from the head of department.

I enquired why such a large sum and he explained that he had been informed the money was required to make certain payments in foreign exchange. It was a heavy request from a trusted senior colleague.

Later in the day, Mrs. Carolyn Kesse (head of the OBC Unit) brought me a forex payment schedule and informed me she had attached Mr. Gavor's name as joint beneficiary of the collection proceeds, as his name appeared on the draft for $1.5 million. I agreed with the action and asked if she had already received confirmation for the credit. She answered no and to avoid the problem of a settlement risk, I directed her to seek confirmation of credit before passing on value to the beneficiary. I must point out that the standard procedure for payment of cash arising from a cheque (draft) for collection transaction is as follows: (1) OBC Unit sends draft to the collecting bank; (2) The bank collects the proceeds; (3) BOG is advised (by mail/Swift); (4) BOG seeks confirmation (if credit not received, being validated or authenticated); (5) Confirmed credit received and the beneficiary notified and (6) Payment Schedule is prepared and passed on to FEU for cash payment. And that was why I insisted that we sought further confirmation before processing for payment.

The following day, that was on 17th December 1999, Mr. Ashie Djanie of the OBC Unit, came to inform me that the confirmation for Mr. Gavor's collection item had been received. I asked if everything was okay and he answered in the affirmative and left to continue with the processing. I believed Mr. Djanie came to inform me only because I had insisted that the confirmed credit was a necessary condition for the payment.

Later on, I instructed Mrs. Angela Mensah to have Mr. Gavor sign for the payment, as he was vouching for the transaction. At that time, I considered it a welcome gesture for an individual Ghanaian to bring in US$1.5 million at a go and at a time when liquidity on the domestic forex market was low.

On 1st March 2000, Mr. Gavor invited me to his office and informed me that the credit for $1.5 million payment had been reversed by Citibank, the draft returned unpaid and a replacement draft had been issued for the same value and that we should therefore wait for the fate of the new draft. I questioned why I was not notified about the returned draft and he explained that he didn't want to disturb me and that he was already in touch with the beneficiary. I became alarmed because it was then that the possible difficulty of recovering the amount dawned on me, though I had authorized the payment in good faith. My only prayers were that the second draft would clear and the Bank's funds recovered.

On I3th March 2000, Gavor called me to his office in order to meet with the beneficiary, Hajia Baby Ocansey, with a view to resolving the issue urgently. Other staff members present were E. D. Donkor, Angela Mensah, Dorothy Nyarko and Ashie Djanie.

Also present were Hajia's son-in-law (Siddiq), who is Gavor's friend and one Alhaji Tijani. Gavor informed the meeting that the second draft had been dishonoured for the reason that it was counterfeit. The meeting therefore wanted to know the immediate steps the woman was taking to refund the money. She was given two weeks to make the payment, and this should be by a Swift transfer. Hajia agreed and assured the meeting that the money would be refunded by the given time. Following that assurance, we decided to inform Management at that stage.

After the meeting, I decided to look at the documents covering the transaction, with the desk officer, Mr. Ashie Djanie. It was there and then that I sighted, for the first time, the swift message which had the proviso that the payment was subject to U.S Cheque Clearing Regulations. I found out that the message was not a swift advice confirming credit and that my staff had appeared to have erred in considering the Swift message as a confirmation. Nevertheless, Citibank, being aware that that the draft had been returned unpaid should not be seen to have advised later on that the proceeds had been credited provisionally.

Gavor, meanwhile, continued with his intense efforts to get the woman to make the refund. I must say I got to know Hajia this year in my neighourhood at a time when I was not aware that she was directly connected with the transaction. After the two-week deadline, I learnt from the neighourhood that Hajia had left for the Hajj. Quickly, I informed Mr. Gavor who contacted his friend Saddiq for confirmation about Hajia's trip. We therefore had to wait for her return to ascertain if she had recovered the funds.

On her return, we contacted her about the refund of the money, and since we did not seeing anything positive, we decided to report to Management. This culminated in Mr. Gavor writing to the head of Banking Department.

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