Finance: What we know about SSNIT $72 million alleged fraud scandal

Finance: What we know about SSNIT $72 million alleged fraud scandalWhat we know SSNIT $72 million alleged fraud scandal

Top management executives of Ghana’s Social Security and National Insurance Trust (SSNIT) have been left embattled over a $72million fraud scandal rocking the trust.

 

  • Top management executives of Ghana’s Social Security and National Insurance Trust (SSNIT) have been left embattled over a $72million fraud scandal rocking the trust.

  • When the project was to be awarded at an initial $32million, a bidding was done and Perfect Business Systems (PBS) won the bid to install the OBS platform.


Top management executives of Ghana’s Social Security and National Insurance Trust (SSNIT) have been left embattled over a $72million fraud scandal rocking the trust.

What happened?

Local media report that the SSNIT had decided to launch an initiative, Operational Business Suite, to help with the activities of the trust in 2014.

However, the IT project failed after the SSNIT had doled out a total of $72million for the project. When the project was to be awarded at an initial $32million, a bidding was done and Perfect Business Systems (PBS), which led a private consortium won the bid to install the OBS platform.

Subsequently, the cost of funding the project had continued to increase as SSNIT dropped another $34million and later $6million to the completion of the failed project.

The OBS initiative is an IT project that is geared providing new technology that would deliver a master card electronically after beneficiaries have undergone biometric registration, which is a departure from business-as-usual.

The OBS will provide a master or smart card that will see each beneficiary having a new biometrically generated SSNIT number which would ensure free access and accessibility to state-of-the-art services.

The OBS was adopted to create multiple delivery channels to customers, make the transaction easier, eliminate fraud and reduce benefits processing time.

The OBS was also expected to facilitate collaboration between SSNIT, business partners, banks, National Health Insurance Scheme and Students' Loan Trust.

Who was behind it?

There are allegations that top management executives of the SSNIT as well as the owners of the consortium that won the bidding to design and create the OBS engaged in fraudulent activities in the government parastatal.

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According to local reports, Former Director-General of the Social Security and National Insurance Trust (SSNIT), Ernest Thompson is the man at the center of the fraud allegation.

Other suspected top executives of SSNIT, who have been fingered in the alleged fraud are former OBS project manager, John Hagan Mensah, and Caleb Kweku Afaglo, who was head of IT.

Related:   Finance: Ghana’s anti-graft agency picks up Capital Bank’s chief, William Essien

Also in the picture is Juliet Hassana Kramer, Chief Executive Officer (CEO) of Perfect Business Systems (PBS), which led the private consortium to win the bid to install the OBS platform.

 

How has Ghanaian government reacted?

The Ghanaian government has reacted to the alleged fraud by the country’s anti-graft agency, the Economic and Organized Crime Office (EOCO).

Already, SSNIT Board Chairman, Dr. Kwame Addo Kufuor has revealed that the four top executives fingered in the fraud scandal are expected to face a charge of willfully causing financial loss to the state in the award of a $72 million OBS contract.

Kufuor also announced that a report from the PricewaterhouseCoopers, an international audit firm, covered operations of SSNIT for the period ended December 31, 2016, and the three-month period ending March 31, 2017.

The PricewaterhouseCoopers report also indicted the previous board of SSNIT headed by Joshua Alabi.

The report had said Joshua Alabi led board did not appear to demand accountability when the issue of poor overspending and poor project management were brought to their attention.

 

Will any action be taken?

Already, the EOCO had arrested the prime suspects of the alleged fraud that has attracted so much attention of the public.

While the SSNIT board alleged that a total amount of over $70 million was paid to PBS in respect of the OBS project, the EOCO is conducting investigations to ensure the culprits are brought to book.

“The original OBS contract sum was $34 million but at the time the project was completed, the contract sum had shot up to $66.8 million and GH¢36 million.

“This means that at the end of the OBS project, an additional amount of $32 million and $36 million was paid to PBS.

“Five suspects were arrested… However, four of them have been cautioned. These include Ernest Thompson, Mrs. Juliet Hassana Kramer, John Hagan Mensah and Caleb Kweku Afaglo,” a spokesperson for EOCO indicated.

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