Microfinance BoG can't be blamed for DKM Saga - Databank CEO

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The Chief Executive Officer of Databank Kojo Addae-Mensah play

The Chief Executive Officer of Databank Kojo Addae-Mensah

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The Chief Executive Officer of Databank Kojo Addae-Mensah said the Bank of Ghana (BoG) cannot be entirely blamed for the microfinance crisis.

In an interview with Accra based Class FM, Addae-Mensah said "Everybody is pointing fingers at the Bank of Ghana and everybody is saying the Bank of Ghana didn’t do A,B,C. No…some of them are not even registered with the Bank of Ghana in the first place, let alone for them to go in there and regulate."

"Did you check whether the company you were putting your money in has a regulator… or you assumed and you are pointing fingers at the Bank of Ghana? What should the Bank of Ghana do when the guys are not registered under their umbrella? They have no authority or no right to go in there and check their books, so it's important that you make sure, where you are putting your money has a third party properly established regulator," he added.

President John Mahama and the minority leader Osei Kyei Mensah Bonsu have both blamed the BoG for the crisis.

The president in his state of the nation address to parliament said lack of effective supervision by the central bank of Ghana led to the famous DKM case where hundreds of customers had their savings go waste.

Kyei Mensah suggested that the BoG is complicit in the matter because they failed to act timely in an interview with Accra based Starr FM.

He said, “This is a tragedy that has befallen us as a nation. This is a national emergency to some of us and it should be treated as such.” 

“Is it the case that we should always be lamenting and leave people who are responsible for it? We were told some officials of the Bank of Ghana went to the enclave to encourage people to invest. Bank of Ghana failed to act even when huge monies were being withdrawn and converted into foreign currencies.” he added.

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But the Databank CEO said it was incumbent on prospective investors to do due diligence before investing in a company that promise huge investment returns.

According to him, "Databank is regulated by the Securities and Exchanges Commission (SEC), as should all investment companies. Commercial banks are regulated by the central bank, pension funds are regulated by the National Pensions Regulatory Authority (NPRA), insurance firms are regulated by the National Insurance Commission (NIC), so there is a regulator for any properly established finance house and as an investor, you must check this out."

Addae Mensah added that most of the companies involved in the crisis are not under the radar of the BoG, making supervision and monitoring difficult.

"I think there are two of the firms that were under the umbrella of the regulator, but most of the others were not even on their radar. They are fan clubs, everybody is entitled to free associations…they can go ahead and do that."

Several people have committed suicide in the Brong Ahafo Region after several months of failed efforts to get back their monies

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