We have noted with concern a story published in The – Herald newspaper of Wednesday, September 11, 2019 under the headline – “Government Team On PDS Detects Fraud at Donewell Insurance” – imputing fraud to DICL’s role in providing PDS GUARANTEE. We wish to state that DICL’s role in this PDS matter was to issue a guarantee for USD100 million for the Lease Assignment Agreement and USD 250 million for the Bulk Supply Agreement which was done professionally and in accordance with international best practices, and in conformity with the Insurance Act, 2006 (ACT 724).
We draw the public’s attention to paragraph 7 of the said publication in The – Heraldnewspaper which alleges instances “in which AlKoot had purportedly issued Demand Guarantees which were fraudulent transactions involving Donewell, Genser and Barack Companies, all of which were done by Yahya Al Nouri”, as the basis of its assertion.
With respect to the allegation above which was culled from paragraph 21 of the Minister’s report, we wish to state unequivocally that DICL has had a history of business transactions with AlKoot involving the same Yahya Al Nouri who is the Head of Reinsurance and has been the principal officer dealing with those transactions on behalf of AlKoot through JoAustralia, the Reinsurance broker.
It is therefore inconceivable per the agency theory of commercial transactions for anyone to impute wrongdoing on the part of DICL for dealing with AlKoot through Yahya Al Nouri and JoAustralia, when this same official and broker have been involved in similar transactions in the past without any disclaimers. We are therefore at a loss as to why an officer held out by his company as Head of Reinsurance to DICL could now be said not to represent AlKoot as a company after the transaction had taken place and after DICL had transferred premiums through the broker and received valid evidence of cover through JoAustralia. It is erroneous for AlKoot to impute fraud at DICL for all the previous transactions in the report of the Minister leaked to the press.
Paragraph 17 of the Minister’s report which leads a casual reader to the conclusion that DICL has acted fraudulently has no bearing on our fiduciary responsibility with AlKoot in the issuance of the PDS guarantee. DICL vehemently rejects in toto any assertion relating to the authority of Al Nouri as an employee of AlKoot that he acted without authority since he still remains an employee of AlKoot.
Insofar as international commercial transactions of this kind are concerned, it is untenable for any company of the calibre such as AlKoot, an A – rated international company to say that it did not know or authorize what its principal employees do on their behalf, to warrant innocent third party companies being described as fraudulent.
It is unfortunate that the Minister’s leaked report has not been officially submitted to DICL to enable the Company give an appropriate response. In the interim, DICL wishes to assure the insurance community and the government that it has provided sufficient information as evidence to investigative agencies, pointing to the fact that its involvement in the issuance of this guarantee was above board.
One of the misleading propositions in the leakedMinister’s report is an allegation that AlKoot’s net worth of USD 170 million was far below the exposure that these guarantees covered. It is trite knowledge in insurance practice that no insurance/reinsurance company uses its net worth to assume a risk. How are Ghanaian insurance companies able to insure companies such as Bulk Oil Storage and Transportation Company Limited, Tema Oil Refinery, Ghana Airport Company Limited, Ghana Ports and Harbours Authority and the likes whose exposures are in excess of the insurance companies’ net worth? This is possible because in practice there is no relationship between the net worth of an insurance company and the risk they assume as insurance thrives on risk sharing.
DICL is a fully complaint insurance company with a track record which can be vouched for at the National Insurance Commission. It has taken pains over a period of 26 years to do ethical business to win the support and cooperation of individual Ghanaians and corporate entities.
DICL has never been involved in any activity that a court or Regulator will deem fraudulent. We wish therefore to say that the effort to craft the said article in The – Herald newspaper could have benefitted from in-depth insights rather than on mere regurgitation of the said Minister’s report.DICL is an ethical business and a corporate citizen. Our reputation thrives on the values of our founding fathers and will not at any point in its operations be involved in anything untoward or unethical.
As a respected newspaper, we expected The – Herald newspaper to have contacted DICL on the issues mentioned, and not to postulate on unconfirmed and contentious matters some of which are engaging the attention of our lawyers.
We would respectfully demand that an appropriate effort goes into the publication of this rejoinder to set the records straight and assure the Ghanaian insurance community that the leaked Minister’s report has issues whose veracity are still in contention and must not be accepted as sacrosanct.
Meanwhile, notice is served that due to legal actions which are emanating from this transaction, the public should not be unduly misinformed. DICL is at the moment studying parts of the Minister’s report and shall at the appropriate time institute legal action locally and internationally on this matter to clear its name.
We assure all Ghanaians that DICL will not sacrifice its reputation for any political smear or media misadventure. We call on the public to be circumspect on the issues until the appropriate official response is given on the supposed Minister’s report.
Our tagline “If must be done, it must be Donewell” will remain our guiding principle in all our processes. We thank you.
Donewell Insurance Company Limited
September 12, 2019