Finance Minister Seth Terkper has revealed that DKM Microfinance Company Limited invested GH₵77 million of investors’ deposits into personal businesses and subsidiaries belonging to managers of the firm.
Terkper made this known when he appeared before Parliament on Tuesday to answer questions on the operations of some rogue microfinance companies.
The money is suspected to have been diverted into companies such as DKM Mining Ltd, DKM Transport Ltd and DKM Cement Depot Ltd.
According to Terkper, DKM microfinance was registered as a savings and loans company in 2013 but violated regulations of the Bank of Ghana which eventually led to the closure of the popular firm in the Brong Ahafo region.
A report by the Financial Intelligence Centre revealed that the company collected ₵115.2 million from customers but had only ₵10.8 million in its accounts at the time of investigations.
After customers complained of the firm’s inability to pay their claims, the Bank of Ghana gave DKM a month to raise GHc50 million in addition to the GHS10.7 million the firm had in its vault, so it could be cleared to resume operations and pay its investors their due principals and accrued interests.
But DKM was unable to do so, despite an extension of the grace period accorded it by the Central Bank.
The CEO of DKM was arrested by the BNI last year after he was sued by a client but he was later granted bail.
Hundreds of clients affected by the saga recently ransacked the company’s premises to seize properties in order to offset their debts.
