Private legal practitioner Martin Kpebu has commended the Office of the Special Prosecutor (OSP) for taking action on the Strategic Mobilisation (SML) deal.
He says that the action of the OSP means finally, accountability is taking place.
“Finally, there is some accountability. When this story broke in the previous administration, because President Akufo was the clearing agent, he quickly got KPMG to issue a report. A lot of CSOs said KPMG shouldn’t do it because KPMG had too many contracts from the Akufo-Addo government. It is good that OSP is finally coming to speed on this matter to some extent,” he said on the Key Points on TV3 Saturday, June 28.
“OSP has been slow, but finally it is okay, they have come,” he added.
The OSP announced that it has arrested Rev. Dr. Ammishaddai Owusu-Amoah, former Commissioner-General of the GRA; Isaac Crentsil, ex-Commissioner of Customs and now General Manager at Stargetic Mobilsation Limited (SML); and Christian Tetteh Sottie, former Technical Advisor and now MD/CEO of SML.
In a statement on Wednesday, June 25, the OSP said that the arrests were linked to ongoing investigations into suspected corruption and corruption-related offences in respect of contracts between the GRA and SML for revenue assurance services.
“The probe also seeks to verify SML’s claims that its services have been saving the nation significant revenues. Owusu-Amoah, Crentsil and Sottie were detained last night after failing to meet bail conditions,” the statement said.
About the SML Scandal
The SML scandal was revealed in an investigative documentary by three former reporters of The Fourth Estate, Evans Aziamor-Mensah, Adwoa Adobea-Owusu, and Manasseh Azure Awuni, after a year’s extensive investigation into the shady operations of SML.
The company had been paid over $141 million by the government by the end of 2023 for its contracts, which have allegedly broken several laws, including the PPA Act.
Read also: Let’s have balanced view on GRA-SML deal – Gyampo
In 2023, the Minister of Finance, Ken Ofori-Atta, directed that the scope of SML’s contract be expanded to cover the mining sectors and upstream petroleum sectors.
The contract, worth more than $100 million a year, was for an initial period of five years, subject to another five years’ renewal.
Under that deal, SML is entitled to a percentage of revenue from every litre of petroleum product one buys in Ghana. The company is also entitled to a fixed percentage of revenue from every barrel of oil produced in Ghana and a fixed percentage of revenue from every ounce of gold mined in Ghana.
Following the investigation by the three journalists and subsequent report by KPMG, the upstream and mining sector contracts have remained suspended. The government also cancelled the external price verification and transaction audit services at the port, which the KPMG report said were already being performed by the GRA.
Read also: GRA-SML deal: No technical needs assessment was done prior to engaging SML but… – KPMG report
About SML deal
In April 2024, the then President, Nana Addo Dankwa Akufo-Addo, instructed the Ghana Revenue Authority (GRA) and the Ministry of Finance to renegotiate the revenue assurance contract with Strategic Mobilisation Limited (SML).
The then President emphasised that the renegotiation should be closely monitored and evaluated periodically to ensure it meets expectations.
The decision to renegotiate the contract followed Mr Akufo-Addo’s acceptance of recommendations made by KPMG after its audit of the deal.
The audit findings prompted the need for a review of the revenue assurance contract, highlighting areas where improvements are necessary to enhance its effectiveness.
“There is a clear need for the downstream petroleum audit services provided by SML. GRA and the State have benefited from these services since SML commenced providing them. There has been an increase in volumes of 1.7 billion litres and an increase in tax revenue to the State of GHS 2.45 billion. KPMG also observed that there were qualitative benefits, including a 24/7 electronic real-time monitoring of outflow and partial monitoring of inflows of petroleum products at depots where SML had installed flowmeters and six levels of reconciliation done by SML.
“This minimises the occurrence of under-declarations. However, it is important to review the contract for downstream petroleum audit services, particularly the fee structure. Given the experience and proficiency of SML over the last four years of providing this service, the President has directed that the fee structure be changed from a variable to a fixed fee structure. Other provisions of the contract worth reviewing include clauses on intellectual property rights, termination, and service delivery expectations,” a press statement released by the then Communications Director at the Presidency, Eugene Arhin read.
Fourth Estate’s GH¢3bn lie report
The Fourth Estate, in a December 2023 investigative report, implicated Strategic Mobilisation Ghana Limited (SML), the Ghana Revenue Authority (GRA), and the Ministry of Finance.
The report alleged that GRA granted SML a purported 10-year contract with an annual payment of $100 million, raising concerns about possible irregularities.
SML refuted the claim, asserting that it had a five-year contract instead.
The GRA, in a statement on December 20, 2023, maintained that the proper procurement procedures were followed.
On January 3, 2024, SML welcomed President Akufo-Addo’s directive to suspend its ongoing revenue assurance operations and undergo an audit of its contract with the GRA and the Ministry of Finance.
President Akufo-Addo appointed KPMG, an audit, tax, and advisory services firm, to conduct the immediate audit.
