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Govt To Start Paying DKM Customers Next Month

Embattled customers of DKM Microfinance Company are claiming a total of GH¢540 million savings with the company prior to May last year when the company’s assets were frozen.

The amount claimed is about 368.6 per cent more than DKM’s total deposits, which were found to be GH¢115.24 million after the Financial Intelligence Centre (FIC) undertook an audit into its operations.

The company operated a 10-branch network in the Brong Ahafo, Upper East and Upper West regions of the country and its assets comprise landed properties, motor vehicles and chattel assets.

To help ensure that nobody outwits the system, the Registrar-General, Mrs Jemima Oware, told the Daily Graphic that the Registrar-General’s Department, which is the official liquidator, would only pay verified claims.

She said the department initially had difficulty acquiring the data of the company but had obtained them after a court order.

She said a list of all those verified would be posted at all the offices where the department carried the liquidation process, as well as three banks — GCB Bank, Agricultural Development Bank (ADB) and Fidelity Bank — which would facilitate the transaction.

“We will set up cages in all three banks and they will pay over the counter from the first week of October. It is not going to be everybody that will be paid at once but those whose claims have been verified,” she said.

Not halted

Meanwhile, the department says in spite of a court injunction obtained by a customer, the process will not be halted, as it applied to only the Sunyani Magisterial District.

“We were served with it when the meeting was just about to end. I should not be seen to be in contempt of court. However, we will continue in the Upper East and West because we have not received any injunction stopping us from going ahead in those areas,” Mrs Oware said.

She was, however, quick to add that the department would immediately stop the process if it was served with any injunction.

The department’s decision followed an injunction on the process by a DKM client who insists that the liquidators were not appointed under the appropriate legislation.

It is the case of the plaintiff that the liquidator was supposed to be appointed under the Non-Banking Financial Institutions Act, 2008 (Act 774) and not the Banking Act, 2004 (Act 673).

But Mrs Oware insists that the liquidators were appropriately appointed by the Bank of Ghana (BoG) under the Banking Act.

She said the department had filed a motion for stay of execution to remove the order which would be heard tomorrow, September 22 , 2015.

The department yesterday met hundreds of customers in Sunyani at a meeting Mrs Oware described as “highly successful because we have been able to engage them and assuage their fears and assure them that they will be paid”.

Other meetings are slated for the Bolgatanga Jubilee Park in the Upper East Region on September 22 and the Wa Jubilee Park in the Upper West Region on September 24, 2016.

The meetings come in the wake of an abortive demonstration by DKM customers in Sunyani last Saturday to protest what they described as government’s lack of commitment to retrieve their money from the micro-finance company.

The demonstration was set to coincide with the manifesto launch of the ruling National Democratic Congress (NDC) at the Coronation Park.

Pricewaterhouse

In a related development, the advisors to the official liquidator, Pricewaterhouse Coopers, has urged all customers of DKM with cases in court to withdraw their legal suits to pave the way for negotiations, as their names are not on the list of those whose money is to be refunded.

But Mr Robert Twene, one of the lawyers for the disgruntled DKM customers with cases in court, told Joy News that they were willing to settle the matter out of court if the liquidator decided to do so.

“As a lawyer, I have a duty to ensure that parties that are willing to settle their matter out of court do so. But we will not withdraw the case unless the liquidator comes to the court to make that request,” he said.

Background

On May 11, last year, the BoG suspended the operations of DKM Diamond Microfinance Company Limited for violating the Banking Act.

The FIC also froze five accounts of the company, directing an immediate freeze of all debit transactions on any of the five accounts.

The company has since been in a financial coma, with distressed customers chasing the company and the BoG for their funds which have been locked up.

In April this year, the Registrar-General’s Department began the liquidation process to establish the true financial position of DKM through the conduct of a forensic audit.

DKM gaffe

The audit confirmed weaknesses, including misreporting to the BoG, mismatches of assets and liabilities and weak governance structures.

DKM’s total deposits — including interest — according to the audit report, stood at GH¢115.24 million, compared with liquid assets of GH¢11.8 million and accumulated losses of GH¢21.02 million.

The company is reported to have diverted GH¢77.2 million of its customers’ deposits to run its subsidiary companies, some of which are DKM Airline Company, DKM Fuel Station, DKM Transport, DKM Shea Butter Company and DKM Mining Company.

 

Source: radioxyzonline.com

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