Information reaching the Business Chronicle indicates that the Securities and Exchange Commission (SEC) is not happy with the way Ghana Telecom (GT), led by Databank, raised an amount of US$40 million through the issuance of bonds to expand and upgrade its network.

The capital market regulator, SEC, raised concerns about the way the transaction was shrouded in secrecy during a day's seminar in Accra on Thursday, to develop an 'over-the-counter' market for Ghana.

A source at SEC said in terms of decency and fair play, the Ghanaian taxpayer must know their company raised the money.

The source further said that the raising of the money without the knowledge of SEC is contrary to SEC Regulation, Legislative Instrument (LI) 1728, schedule 5, which borders on disclosures in terms of raising money through bonds.

"Nobody knows who was approached to invest into GT," the source added.

"We are the owners of GT because government owns GT in trust of the Ghanaian tax payers and they are entitled to any transaction that GT undertakes."

There is however disagreements as to whether the transaction is a private placement because GT is 100% government-owned.

According to SEC, the former CEO, Oystein Bjorge, approached them some two years ago to inquire about how to raise the amount. But he never came back until the new CEO, Mr. Frode Haugen, announced that GT had successfully raised $40 million through the sale of its bonds through Data Bank.

However, the new CEO, Mr. Frode Haugen, in an interview, said it is not illegal for them to raise that amount of money in Ghana through bonds. "I am not aware of any irregularities in raising US$40 million through bond."

"If they don't understand anything, they should contact me," he reiterated.

GT, in March, announced the procurement of $40 million estimated at ?360 billion in the form of bonds to expedite its network expansion and upgrading projects.

The amount is the biggest to be raised by a state-owned company in recent times to meet government's target of making telephone services accessible to all, especially those in the rural areas.

It is also to provide the company with additional capital to expand both fixed lines and mobile lines.

53% of the amount, which is $21 million, was raised locally whilst foreign companies acquired the remainder, estimated to be $19 million.

According to unconfirmed reports, a letter is being drafted to GT to explain the transaction.