A US Federal court in Chicago, Illinois, presided over by District Judge, Thomas M. Durkin, has dismissed a complaint filed against GN Bank, its Chairman, Dr. Papa Kwesi Nduom, GN Bank’s outside directors, and others.
The equity fund and securities investment company based in the United States, Birim Group LLC, filed the legal challenge against Dr. Nduom and 18 others, including his immediate family, over claims of money laundering and wire fraud.
The complaint was filed by the California Limited Liability Company, whose sole member was the lawyer who filed the complaint.
The lawyer had purchased $30,000 and $52,219 claims against companies in Ghana from two citizens of that country.
Although neither GN Bank, Dr. Nduom nor any of the GN Bank directors were alleged to have themselves taken any action against these Ghanaian citizens, the complaint named each of them as defendants based on vague allegations of a vast international conspiracy for which the Court found no supporting facts had been alleged.
Noting that “the U.S. Defendants characterize the Plaintiff’s complaint as a political smear devoid of actionable allegations,” the Court in its dismissal decision stated that “the complaint is adorned with extraneous information, making the allegations difficult to parse into a coherent narrative.”
The bulk of the complaint made civil allegations under the RICO statute, but the Court dismissed those claims “with prejudice.”
This means the RICO claim cannot be brought again. Referring to the Ghanaian citizens from whom the Plaintiff had purchased its claims, the Court also stated about the remainder of the complaint that “[m]ost of the allegations appear wholly unrelated to any losses suffered by Assignors.”
According to the Court, those allegations were “pled in conclusory fashion and fail to allege any liability on the part of the U.S. Defendants for Plaintiff’s common law claims.”
The Court gave Plaintiff 21 days to explain how it could cure the deficiencies of the complaint or else the dismissal of the entire complaint would become permanent, just like the dismissal of the RICO claim.
GN Bank was confident that upon review, the Court would agree that this complaint was without merit and could not proceed as a matter of law.
“We are grateful for the care the Court exercised in reaching its decision today,” said Dr. Nduom.
“Unfortunately, even when allegations are entirely false and without merit, the fact that they have been made at all can be misused for financial or other reasons. That is what happened here, but hopefully, the Court’s clear and decisive decision will put an end to any further misuse of these unfounded allegations.”
Dr. Nduom in his defence had said earlier that the suit by the company was an attempt to “smear [him] a Ghanaian entrepreneur and political leader of the Progressive People’s Party.
Groupe Nduom on April 5, 2021, therefore filed a motion asking for dismissal of the case.
In response to the Tuesday, November 23, 2021, ruling, an elated Dr. Nduom in a Facebook post said,
The suit, which was filed jointly by Coconut Grove Beach Resort and Conference Centre Limited and Groupe Nduom (GN) Limited, is challenging the decision of the central bank to declare GN Savings and Loans Company insolvent leading to the revocation of its operating licence.
Among the reliefs being sought by the plaintiff include a declaration that by failing to take into accounts the indebtedness of the government of Ghana and its MDAs to Groupe Nduom, Gold Coast Advisors Limited or GN Bank before concluding that the savings and loans company was insolvent and, consequently, revoking its specialised deposit-taking licence violates their rights.
They also want an order of certiorari, quashing the decision in the notice issued by BoG which declared GN Savings and Loans Company insolvent and, consequently, revoked its licence to operate as a specialised deposit-taking institution.
Again, the suit is seeking an order on BoG to restore to the company its licence to enable it to continue operating as a specialised deposit-taking institution.
It also wants an order on the Receiver of the company “to submit the possession, management or control of the assets, operations and other activities of the company to its shareholders or persons who, immediately before August 16, 2019, were in possession, management or control of such assets, operations and activities.”
The Bank of Ghana on August 16, 2019, revoked the licences of some 23 insolvent savings and loans and finance house companies including GN Savings and Loans Ltd owned by Dr. Papa Kwesi Nduom.
According to the central bank’s report, GN Savings and Loans transferred $62 million and another £718,000 to its sister company in the US without the knowledge of BoG and the Ministry of Finance.
The BoG, in its release announcing the closures of the said financial institutions, indicated that the financial condition of the GN Savings and Loans Limited had deteriorated since its reclassification from GN Bank in 2018, with both negative capital adequacy ratio and negative net worth.
It added that GN Savings and Loans Capital Adequacy Ratio (CAR) was -61% in breach of the minimum requirement of 13%.