Appendix 2.
Translations of the charges
Appendix 2.1 The charges against Ato Tilahun Abbay et al
(Bank executives and business people)
The Federal Ethics and anti-Corruption Commission
Federal Democratic Republic of Ethiopia
The Federal High Court
Addis Ababa
The Federal Ethics & anti-Corruption
Commission O/Penal Code # 003/94
Indictor:-Prosecutor of the Federal Ethics and anti-corruption commission
Defendants:-
1/Tilahun Abbay Abraha
Age:60
Occupation:President of the Commercial Bank of Ethiopia
Address:
2/Alazar Dessie Kasahun
Age:
Occupation:Executive Vice President Operations
Address:
3/Naser Hasser
Age:
Occupation:Vice President of Credit & Risk Management
Address:
4/Hailu Legesse Aichew
Age:42
Occupation:CBE, Vice President of Credit & Risk Management
Address:Woreda 17, Kebele 21, House # 407/48
5/HabteSelassie Hagos
Age:
Occupation:CBE, Executive Vice President Operations
Address:
6/Mulugeta GebreMedihim Brook
Age:
Occupation:CBE,Assistant Vice President Credit Analysis and Appraisal
Address:Woreda 17, Kebele 29, House # 165
7/Negussie Tadesse
Age:
Occupation:CBE, manager Short Term Finance
Address:
8/Ephrem Negash
Age:
Occupation:CBE, Assistance Vice President Loan Review & Risk Management
Address:
9/Gondere Ayana
Age:
Occupation:CBE, Head of Credit Analysis
Address:
10/Yeshiemebet Demissie
Age:
Occupation:CBE, Credit Head Domestic Trade
Address:
11/Amare Gashaw
Age:
Occupation:CBE, Senior Credit Analyst
Address:
12/Baysa Gemeda
Age:
Occupation:CBE, Assistant Manager Credit Division
Address:
13/Kidane Wolde
Age:
Occupation:CBE, Manager Credit Division
Address:
14/Tsegaye Aga
Age:
Occupation:CBE, Senior Credit Analyst
Address:
15/Girma Negash
Age:
Occupation:CBE, Assistant Vice President International Banking
Address:
16/Alemaihu Zegeye
Age:
Occupation:CBE, Senior Credit Analyst
Address:
17/Kelemework Berhane
Age:
Occupation:CBE, Head Export/Import Section
Address:
18/Abera Mekonen
Age:
Occupation:CBE,
Address:
19/Asrat Belachew
Age:
Occupation:CBE, Anwar Mesgid Branch Manager
Address:
20/Girma Aredo
Age:
Occupation:CBE, Anwar Mesgid Branch Manager
Address:
21/Belay G/Mariam
Age:
Occupation:CBE, Anwar Mesgid Branch Manager
Address:
22/Assefa Tadesse
Age:
Occupation:CBE, Anwar Mesgid Branch Manager
Address:
23/Alula HaileSeilassie
Age:
Occupation:CBE, Finfine Branch Manager
Address:
24/Tilahun Taye
Age:
Occupation:CBE, Finfine Branch Manager
Address:
25/Towelde Asfeha
Age:
Occupation:CBE, Anwar Mesgid Assistant Branch Manager
Address:
26/Girma Muluneh
Age:
Occupation:CBE,
Address:
27/Tesfaye Tekle
Age:
Occupation:CBE, Credit Section Head, Anwar Mesgid Branch
Address:
28/Solomon Asfaw
Age:
Occupation:CBE, Head, Credit Section, Finine Branch
Address:
29/Tilahun Fanta
Age:
Occupation:CBE,
Address:
30/Zewdu Hailu
Age:
Occupation:CBE, Addis Ababa Regional Manager
Address:
31/G/Egzabhare Woldu
Age:
Occupation:CBE, District Manager, Mexico District
Address:
32/Seid Yemer
Age:
Occupation:CBE, Planning and Budget Officer, Addis Ababa Region
Address:
33/Asefa Abishiru
Age:
Occupation:CBE, Addis Ababa Regional Manager
Address:
34/Alemayehu H/Michael
Age:
Occupation:CBE, Mexico District Manager
Address:
35/Jemal Muosa
Age:
Occupation:CBE, Mercato District manager
Address:
36/Zalashweyen Assefa
Age:
Occupation:CBE, Addis Ababa Regional Manager
Address:
37/Tadesse Worku
Age:
Occupation:CBE, Controller
Address:
38/Abraham Aregawi
Age:
Occupation:CBE, Manager Branch Operations Division
Address:
39/Nesredin Mohammed
Age:
Occupation:National Bank of Ethiopia, Vice Governor
Address:
40/Alachew Admassu
Age:
Occupation:CBE, Manager Property Administration Division
Address:
41/Nejib Sheriff
Age:
Occupation:CBE, Broad Member
Address:
42/Worku Megra Bedada
Age:51
Occupation:Share holder/General Manager, Star Business Group PLC
Address:Addis Ababa, Woreda 13, Kebele 01, House# 118
43/Minwuyelet Atnafu Abtew
Age:48
Occupation:Shareholder/General Manager, Mina Trading PLC.
Address:Addis Ababa, Woreda 23, Kebele 15, House # 1056
44/Abebaw Gelaye Beze
Age:32
Occupation:General Manager Tana Transport PLC.
Address:Addis Ababa, Woreda 23, Kebele 13, House #
45/Asnake Gembere Metku
Age:47
Occupation:General Manager/Shareholder AJEMA Ethiopia PLC
Address:Addis Ababa, Woreda 18, Kebele 26, House # 223
46/Abebaw Desta Alemu
Age:38
Occupation:General Manager/Shareholder, Tiss Abay PLC
Address:Addis Ababa, Woreda 23, Kebele 12, House # 1170
47/Berhane Gidey Meshesha
Age:42
Occupation:General Manager/Shareholder:
-Awassa Flour Mill PLC
-Ababa Transport PLC
-Bazen PLC
Address:Addis Ababa, Woreda 17, Kebele 19, House # 277
48/Yeshihareg Zewde Jema
Age:39
Occupation:General Manager/shareholser
-Yegeta Trading PLC
-Addis Ababa Flour Mill PLC
Address:Addis Ababa, Woreda 23, Kebele 12, House # 322/05
49/Sami Yusuf Ahmed
Age:31
Occupation:Shareholder/General Manager Sami Yusuf Import Export
Address:Addis Ababa, Woreda 17, Kebele 23, House # 1061
50/Eskinder Yosef TekleMarian
Age:45
Occupation:General Manager/Shareholder, Meskel Flowers PLC
Address:Addis Ababa, Woreda 28, Kebele 01, House #
51/Abraham GebreKirstos GebreMedhin
Age:
Occupation:General Manager/Shareholder, Abmar Trading PLC
Address:Addis Ababa, Woreda 23, Kebele 12, House # 3-2-2/08
52/Temesgen Mahari
Age:
Occupation:General Manager/Shareholder
-Nile International PLC
-Nile Coffee Export PLC
-Tana International Trading PLC
53/Tedla Yizengaw
Age:
Occupation:General Manager/Shareholder Teddy PLC
Address:
54/Berhan Assefa EnkuSelassie
Age:49
Occupation:Shareholder, Berhan Assefa Trading
Address:Woreda 17, Kebele 20, House # 652
Statement of Offence #1 : for Defendants listed from # 1-53 only.
The prosecutor charges the Defendants as follows:
In violation of the 1957 Ethiopian Penal Code article #32/1/a, article #33 and the revised special penal code proclamation #214/1981, article 23/1/b.
Particulars of Offense:
The Defendants listed from numbers 1 to 41, in collaboration with those accomplices whose identity is not yet known, while working in various capacities in the Commercial Bank of Ethiopia, committed illegal acts to favor the Defendants listed from #42 - 53 and their respective business enterprises violating the following Bank Policy and Procedures:
-Extending loan to new clients without adequate credit assessment.
-Extending loan that exceeds the borrower is business enterprises paid up capital.
-Extending loan in various and complicated manners where the borrower is also guarantor to individuals and enterprises.
-Approving or Recommending loans without the request being deliberated upon by the Bank's credit committee echelons.
-Accepting personal guarantee as security.
-Lowering down the value of the collateral by increasing the loan amount.
-Extending loan in the absence of a business financial statement from an accredited auditor.
-Accepting chattel mortgage, share certificates, financial guarantee bonds as collateral which are not allowed for loans.
-Failure to require additional collateral to compensate for the depreciated value of assets.
-Extending merchandise loan for the collateral that are not yet at hand.
-Approving temporary overdrawal without first requiring a promissory note from the borrower.
-Extending large amount of loan while the value of the collaterals are low.
-Extending credit facilities with inadequate analysis.
-Extending loans without establishing the identities of the legitimate loan approving bodies.
-Extending large amount of loan against the collateral of exaggeratedly valued merchandise.
-Extending loans against assets with exaggerated value of assets valuated by an unaccredited external valuator instead of the Bank's valuation officers.
-Switching already collateralized assets as additional collateral for other loans.
-Accepting already collateralized assets as additional collateral for loans extended for a further period.
-Transfer of loans from one account to another without credit analysis and appraisal.
-Taking a building that doesn't have building permit as collateral.
-Taking vehicles as collateral without revaluating them annually.
-Keeping un-saleable inventories as collateral for a prolonged period of time.
-Allowing borrowers to utilize temporary overdrawals as regular overdraft facility.
-Extending term loan while overdraft credit is still in place.
-Providing similar loan for a borrower prior to the settlement of an existing similar loan.
-Approving loan to a borrower who does not own any fixed assets.
-Approving another loan without rectifying discrepancies observed on previous loan.
-Accepting chattel mortgage with a 2nd degree mortgage status.
-Extending credit by concluding mortgage contract without the legal consent of the spouse.
-Extending large amount of loan to companies that lack extensive experience in the commercial transport sector.
-Securing machines as collateral where there is no registering body that prevents the sell and transfer of those properties.
-Concluding loan contract with a person who has no legal right to borrow.
-Using a particular enterprise's fixed asset as security for another enterprise.
-Extending merchandise loan prior to verifying documents for equity contribution.
-Extending merchandise loan prior to holding equivalent merchandise value as collateral.
-Issuing C.P.O. services with insufficient fund in the account.
-Extending credit to individuals with unlawful land lease agreement.
-Fully settling previous loan with another new loan.
-Extending Credit for a duration outside the statue of limitation.
-Extending additional loan at a time when the previous loan should have been first collected.
1.1Whereas, Defendants #1, #2, #3, #4, #5, #6, #14, #20 and #30 inappropriately extended the following credit between 11/12/97 and 08/05/01 to Defendant #42 and Star Business Group Private Limited Company, through the Commercial Bank of Ethiopia's Anwar Mesgid Branch:
1.1.1Overdraft Birr10,000,000.00
1.1.2Merchandise loanBirr20,000,000.00
1.1.3Overdrawal loan Birr15,000,000.00
Total Birr45,000,000.00
1.2Whereas, Defendants #1, #3, #4, #5, #6, #7, #8, #9, #10, #12, #13, #14, #18, #19, #20, #21, #22, #23, #28, #32, #37 and #39 inappropriately extended the following credit between 25/01/93 and 16/02/00, there the Commercial Bank of Ethiopia's Anwar Mesgid Branch.
1.2.1Overdraft Birr40,000,000.00
1.2.2Merchandise loan Birr75,000,000.00
1.2.3Truck Loan Birr37,718,700.00
1.2.4Letter of Credit Birr10,000,000.00
1.2.5Overdrawal Birr27,500,000.00
TotalBirr 190,218,700.00
1.3Whereas, Defendants #1, #2, #4, #5 and #6 inappropriately extended a truck loan amounting to Birr 35,388,240.00 on the 6th of November 1998, to Defendant #44 and Tana Transport Private Limited Company, there CBE's Anwar Mesgid Branch.
1.4Whereas, Defendants #1, #2, #3, #4, #5, #6, #7, #14, #20, #21, #26, #27, #36, inappropriately extended the following credit services between the period 20/08/96 and 20/12/00, to Defendant #45 and AJEMA PLC, through CBE's Anwar Mesgid Branch.
1.4.1Overdraft Birr12,000,000.00
1.4.2Truck loan Birr10,230,921.00
1.4.3Merchandise loan Birr 5,000,000.00
TotalBirr27,230,921.00
1.5Whereas, Defendants #1, #3, #4, #5, #6, #7, #8, #9, #10, #12, #13, #14, #19, #20, #21, #25 and #27, inappropriately extended the following credit between 07/02/95 and 22/02/01 to Defendant #46 and Tiss Abay PLC through CBE's Anwar Mesgid Branch:
1.5.1Overdraft Birr60,000,000.00
1.5.2Truck loan Birr44,643,418.00
1.5.3Merchandise loan Birr15,000,000.00
1.5.4OverdrawalBirr21,000,000.00
TotalBirr 140,643,418.00
1.6Whereas, Defendants #1, #2, #3, #4 and #5 inappropriately extended the following credit between 04/06/96 and 09/01/01, to Defendant #47 and his companies through CBE's Bole and Awasa Branches:
1.6.1Abeba Geday P.L.C.
-Overdraft Birr20,000,000.00
-Truck loan Birr47,431,000.00
-Overdrawal Birr 3,000,000.00
TotalBirr70,431,000.00
1.6.2Bazen P.L.C.
-OverdraftBirr10,500,000.00
-Term loan Birr 2,500,000.00
-Term loan Birr13,258,743.00
TotalBirr26,258,743.00
1.6.3Abeba Transport PLC
-Overdraft Birr12,500,000.00
1.6.4Awasa Flour Mill Factory
-Overdraft Birr20,000,000.00
Grand TotalBirr129,189,743.00
1.7Whereas, Defendants #1, #2, 3#, #4, #5, #6, #8, and #17 inappropriately extended the following credit between October 1993 and 13/03/01 to Defendant #48 and Yegeta Trading P.L.C from CBE's Finifne Branch:
1.7.1Overdraft Birr 27,400,000.00
1.7.2Merchandise Loan Birr 19,033,896.00
1.7.3Term Loan Birr 78,204,038.00
1.7.4OverdrawalBirr 3,000,000.00
TotalBirr127,637,934.00
1.8Whereas, Defendants #1, #2, #4, #5, #6, #7, #9, #10, #11, #12 and #14 inappropriately extended the following credit services, between the period 16/09/94 and 27/06/01, to Defendant #49 and Sami Yusuf Import Export Business Enterprises, through CBE's Finine Branch.
1.8.1Overdraft Birr22,000,000.00
1.8.2Merchandise loan Birr80,496,000.00
1.8.3Letter of creditBirr15,000,000.00
TotalBirr 117,496,000.00
1.9Whereas, Defendant #1, #2, #3, #5, #6, #9, #11, #12, #13, #40 and #41, inappropriately extended agriculture loan of Birr 8, 244,918, between the period 07/04/93 and 24/01/98 to Defendant #50 and Mesket flower PLC, through CBE's Bole Branch.
1.10Whereas, Defendants #1, #4, #5, #7, #8, #23, #24, #25, #29, #30, #31, #32, #33, #34, #35 and #36, inappropriately extended the following credit, between the period 28/10/96 and 20/04/01, to Defendant #51 and ABMAR International PLC through CBE's Finfine Branch.
1.10.1OverdraftBirr 1,800,000.00
1.10.2Term loan Birr 5,000,000.00
1.10.3OverdrawalBirr 2,050,000.00
1.10.4Letter of creditBirr 2,000,000.00
1.10.5Truck loan Birr12,899,246.00
TotalBirr23,749,246.00
1.11Whereas, Defendants #1, #4, #5, #6, #7, #9, #12, #13, and #15 extended the following credit between the period 16/09/99 and 25/05/01, to Defendant #52 and his companies through CBE's Abakoran and Finfine Branches:
1.11.1Nile International Trading P.L.C.
-Overdraft Birr30,400,000.00
-Truck loan Birr37,729,838.02
-Term loan Birr15,000,000.00
TotalBirr84,577,438.02
1.11.2Nile Coffee Exports P.L.C.
-Overdraft Birr35,000,000.00
-Truck loan Birr13,000,000.00
-Overdrawal Birr 3,000,000.00
-Merchandise loan Birr13,000,000.00
-Revolving credit Birr10,000,000.00
TotalBirr74,000,000.00
1.11.3Tana International Trading P.L.C.
-Overdraft Birr 1,000,000.00
-Truck loan Birr 2,594,439.80
TotalBirr 3,594,439.80
Grand TotalBirr162,171,877.82
1.12Whereas, Defendants #1, #2, #3, #4, #5, #6, #7, #8, #14, #19, #20, #21 and #27 extended the following services between the period 01/07/96 and 31/05/01, to Defendant #53 and Teddy Trading P.L.C. through CBE's Anwar Mesgid Branch.
1.12.1Overdraft Birr3,000,000.00
1.12.2Merchandise loan Birr5,002,000.00
1.12.3Term loan Birr1,500,000.00
Total9,502,500.00
Furthermore, Defendants #42, #43, #44, #45, #46, #47, #48, #49, #50, #51, #52 and #53, having been managers and owners of the aforementioned commercial business enterprises, illegally received the amount of money indicated; whereas, all Defendants are charged for conspiring to undermine the government's and people's interest and for being accomplices to the abuse of power entrusted to them by the people.
Statement of Offence #2 :for Defendants #1, #52 and #54 only.
The prosecutor charges the Defendants as follows:
In violation of the 1957 Ethiopian Penal Code article #32/1/a, article #33 and the special penal code proclamation #214/1981, article 23/1/b.
Particulars of Offense
Defendant #1, in collaboration with those officials of the Commercial Bank of Ethiopia, whose identity is not yet known, but worked as members of the Management Board Committee and heads of the International Banking Divisions, committed the following illegal acts to favor Defendants #52 and #54:
1)Whereas, Defendant #52, while working as Manager of Berhan Assefa Coffe Export Enterprise, Applied through a letter written (registration # 192/92/84 and dated Sene 3, 1984 E.C) to the International Banking Division of the Commercial Bank of Ethiopia, requesting the Bank to forward payments to the Coffee Marketing Corporations, for the value of the coffee the Defendant planned to export to Saudi Arabia; whereas, the amount forwarded by the Bank was to be repaid through sale of imported merchandise, in lieu of the coffee exported; thus, based on such an applications and without any credit contractual agreement, Defendant #1 allowed the Bank to forward, through several transactions, Birr 60,024,622.19 (sixty million twenty four thousand six hundred twenty two and nineteen cents) to the Coffee marketing Corporation.
2)In exchange for the coffee, exported, the tyres and tubes imported were loaded through the bill of lading numbers YAS 012, CAS 012, YAS 017 and YAS 015; whereas, contrary to the delivery order, the bartered goods were loaded under the beneficiary title of Berhan Assefa Export rather than the Commercial Bank of Ethiopia; whereas, Defendant #1 failed to instruct the other Defendants to follow up the case and have the Enterprises collect the document after paying the aforementioned amount.
3)Whereas, Defendant #54, in a proxy letter - dated 10/04/84 and registered BA/510/84/91 - authorized Mrs. Belaynesh GebreMariam, the then Nile International's Assistant Manager, to represent Berhan Assefa Export Enterprise, and execute all activities related to the Coffee Marketing and Coffee Corporation; whereas, by virtue of such a commission, the Defendant facilitated the following transactions: the transfer of the aforementioned Birr 60,024,622.19 from the bank to the Coffee marketing Corporation; and the signing of the purchase agreement of the 7000 tons of 5th grade Harar coffee an agreement which Defendant #52 used to leverage the enterprise's credit application - exported to Saudi Arabia.
4)Defendant #52, after having the Commercial Bank of Ethiopia extend, on his behalf, the aforementioned amount of money, purchased coffee from the Coffee marketing Corporation and exported the goods to Saudi Arabia; whereas, rather than paying back the debt and secure the bill of lading documents, the Defendant kept the money to benefit himself.
Whereas, all the defendants are then charged for conspiring against the government's and people's interest and for abusing the power entrusted to them by the people.
Statement of Offense #3:for Defendants #1, #4, #5, #6 and #42 only
The prosecutor charges the Defendants as follows:
In violation of the 1957 Ethiopian penal code article #32/1/a, article #33 and the revised special penal code proclamation #214,1981, article 23/1/b
Particulars of Offense:
1)Defendants #1, #4, #5 and #6; intending to advance unlawful gains to Defendant #42 and the enterprise he manages Ethio Investment Group Private Limited Company - committed the following acts: whereas, to recover a previous loan that Commercial Bank of Ethiopia extended to Ethio Automotive Private Limited Company (ETAMO), the Bank's foreclosure on the asset and enterprises of ETAMO and LATCO, enabled Ethio Investment Group to win the bid at the floor price of Birr 182,000,000; whereas based on the pre-conditions set on the bid offer by Ethio Investment Group, the Bank's assigned negotiation team, ignoring the property valuation and audit report made by an external consultant decided to sell the assets for Birr113,717,594; whereas, after the sells agreement was signed, further discount was made during sales delivery, inappropriately bringing the final sales price from Birr 113,717,594 to Birr 93,705,384.67.
2)Whereas, based on the sales agreement, to cover 80% or Birr 90.9 million of the sales price, the Bank, having agreed to extend the previously used ETAMO and LATCO's Birr 50 million merchandise and 40 million overdraft that amounted to Birr 90 million; whereas, after the sales price was further lowered to Birr 93.7 million, in accordance with the aforementioned contractual agreement, a proportional 80% adjustment on the final offer should have brought the credit facility from Birr 90 million to Birr 74.9 million; whereas because of an inappropriate arrangement, it has become evident that 96% of the sales price was covered by the bank.
Defendant #42, having secured an undeserved bank loan through inappropriate sales negotiation of the enterprises, bought ETAMO and LATCO enterprises in an unlawful manner.
Whereas, all the Defendants are charged for conspiring against the government's and peoples interest and for being accomplices to the abuse of power entrusted to them by the people.
Statement of Offence #4:for Defendants #1, #4, #5, #6 and #48 only
The prosecutor charges the Defendants as follows:
In violation of the 1957 Ethiopian Penal Code article #32/1/a, article #33 and the revised special penal code proclamation #214/1981, article 23/1/b
Particulars of Offense
Defendants #1, #4, #5, and #6, intending to advance unlawful gain to Defendant #48, and the enterprise she manages Yegeta Trading PLC, committed the following acts:
Whereas, based on the December 12, 2000 decision of the Management Board of the Commercial Bank of Ethiopia, a foreclosure bid was carried out to recover the loan, and interest accrued, amounting to Birr 54,870,779.53; whereas the loan was extended to the owner of the Addis Ababa flour mill factory, Halek Wolde Hiamanot Seguar, and his enterprise Genesis; whereas, Defendant #45, unlawfully gained from the acquisition of the Addis Ababa Flour Mill Factory through the following inappropriate bid process.
1)Whereas, the Bank approved the valuation and sales of factory machines, vehicles and office equipments that were neither collateralized by the Bank nor registered by a legal body.
2)Whereas, while determining the floor price of the factory, valuations on the fixed and non fixed assets were made by unrecognized entities outside the Bank.
3)Whereas, when the factory's building was collateralized in 1996 by the Bank, the valuation officer estimated the building at Birr 31,051,900.00; whereas, the estimate for the same building during the bid process brought the figure down to 19,136,778.01; allowing the Defendant to buy the factory for Birr 42,500,100.99, and resulting in a loss of Birr 14,009,643.27 for the Bank.
Whereas, defendant #45, unlawfully acquired the Addis Ababa flour mill factory through an inappropriate bid process; whereas, all the Defendants are charged for conspiring against the government's and people's interest and for being accomplices to the abuse of power entrusted to them by the people.
Appendix 2.2
The charges against ato Assefa Abreha et al (Ato Seeye and Ato Tamrat)
13 October 1994 (E.C)
Federal Democratic Republic of Ethiopia
The Federal Supreme Court
Addis Ababa
Federal Anti-Corruption Commission
File No. # 001/99
Indictor:Prosecutor of the Federal Ethics and Anti-Corruption Commission
Defendants:-
1 Assefa Abreha Hagos,
Age 45
Occupation :- With a rank of a Minister, Head of Public Enterprises Supervisory Authority; Board Chairman of Ethiopian Privatization Agency and formerly Board Chairman of Commercial Bank of Ethiopia .
Address ;Addis Ababa, Wereda 24, Kebele 15, House No. 3841 .
2 Beshah Azmite Mulatu,
Age 54
Occupation :- General Manager and Board Secretary of Ethiopian Privatization Agency.
Address; Addis Ababa, Wereda , Kebele, House No.
3 Seye Abreha Hagos,
Age 48
Occupation :- Formerly Minister of Defense in The Transitional Government of Ethiopia ; Member of the House of the Representatives, Manager of EFFORT
Address ;Addis Ababa, Wereda , 17 Kebele, 19 House No. 105/6
4 Tamerat Layne,
Age
Occupation :- Formerly Prime Minister in The Transitional Government of Ethiopia ;
5 Mehereteab Abreha Hagos,
Age 34
Occupation :- Businesman
Address ;Addis Ababa, Wereda , 21 Kebele, 09 House No.
6 Fisseha Abreha Hagos,
Age 38
Occupation :- Businesman
Address ;Addis Ababa, Wereda , 23 Kebele, 13 House No.13
7 Fiturzeab Asgedom,
Age
Occupation :- Member of Board of Directors of AMCE
Address ;Addis Ababa, Wereda , 23 Kebele, 12
8 Timnit Abreha Hagos,
Age 34
Occupation :- Pharmacist
Address ; Addis Ababa, Wereda , 17 Kebele, 20 House No. 364
9 Kahsay Abay Hagos,
Age
Occupation :- Businesman
Address ; Addis Ababa, Wereda , 24 Kebele, 13 House No.1035
10 Dr Abdi Adem ,
Age
Occupation :- Formerly Minister of Health,
Address ;Addis Ababa, Wereda , Kebele, House No.
11 Hirayar Behinsilyan,
Age 54
Occupation :- Businesman,
Address ;Addis Ababa, Wereda , Kebele, House No.
12 Fitsumzeab Asgedom,
Age
Occupation :- Businesman
Address ;
Statement of offense1:For Defendants #1, #3, and #5 only.
The prosecutor charges the Defendants as follows:-
The Defendants are charged for violating: the 1957 Ethiopian Penal code article #32/1/a/1b/, article 33 and the revised special penal code, proclamation #214/1981 article 23/1/b/c.
Particulars of Offense
Defendant #1, while working at the public enterprise supervising authority under the rank of a Minister and as chairman of the Board of Directors of the Commercial Bank of Ethiopia; and Defendant #3, while working as member of the house of representatives of Federal Democratic Republic of Ethiopia; pursued on illegal act to favor Defendant #5 and MFAM Private Limited Company-a business enterprise established by the blood brothers of the above mentioned Defendants #1, and #3 respectively. The 5th Defendant and the aforementioned enterprise, seeking bank loan services, used Defendant #3, to illegally solicit through several telephone calls at different instances, and instruct the president of CBE to provide Defendant #5 and MFAM with bank loan services. These illegal solicitations were made between the period 27/2/96 to 9/1/2001 and resulted in the following loan services.
1/A term loan of over Birr 6,900,250 and
2/An Overdraft loan of over Birr 10,800,000; provided to Defendant #5, taking advantage of the high rank positions of Defendants #1 and #3. The aforementioned loan was released from CBE's, Bole Branch in a manner that undermined the public interest and harm national interest. All Defendants are then charged for conspiring and soliciting to benefit from the illegal act mentioned; abusing the power entrusted to Defendants #1 and 3 by the people.
Statement of Offense 2:Indictment 2: for Defendants #1,#3,#4, and #9 only.
The prosecutors charges the Defendants as follows:
The Defendants are charged for violating the 1959 Ethiopian penal code article #32/1/a/1b/, article 33/35, and the revised special penal code, proclamation #214/1981, article 23/1/b/c
Particulars of Offense
Defendants #1 and #3, while working as senior public officials pursued on illegal act to favor Defendant #9, and violated the November 1991, Commercial Vehicles Imports Duty Exemption Act #9,1991, to import the following vehicles.
1/Motor #358-0054-003-3118, chasis# WMA 5034 653 MO 17894.
2/Motor #4010106600 chasis# 385147 14422900.
3/Motor #362-910-10-807560 chasis# 61644815161134.
4/Motor #401-927-10-259106 chasis# 38552015043550.
5/Motor #104-927-10-260324 chasis# 3855281576886.
Defendant #9 solicited Defendant #4, the then Prime Minster, to import the aforementioned commercial truck vehicles, where as, Defendant #4, violating the spirit of the Act in a manner that undermined the power entrusted to the Defendant by the people, authorized the then Provisional Ministry of Finance to issue permit for the importation of the vehicles. Thus, Defendant #9, having benefited from the illegal importation of the vehicles; all the Defendants are charged for conspiring and soliciting to benefit from the illegal act mentioned, in a manner that abused the power entrusted to them by the people.
Statement of Offence 3: For Defendants #3, #5, #6, and #7 only.
The prosecutors charges the Defendants as follows:
The Defendants, are charged for violating the 1957 Ethiopian penal code article #32/1/1/b/, article 33/35, and the revised special penal code, proclamation #214/1984, article 23/1/b/c/.
Particulars of Offence
Defendant #3, while working as Member of the House of Representative of the Federal Democratic Republic of Ethiopia and General manager of EFFORT, Defendant #7, while working as Board Member of AMCE, pursued an illegal act to favor Defendants #5 and #6, where in the Ethiopian Government is a share holder of AMCE, and Defendants #5 and #6 illegally purchased vehicles, soliciting similar discounts offered to EFFORT and Trans Ethiopia- when the later two companies purchased 213 commercial truck vehicles from AMCE. Thus, Defendant #5, purchased the following in a manner mentioned above.
1/Five commercial truck vehicles registered under his name benefiting from the discounts negotiated by the aforementioned companies:
CHASIS # 032727, Motor # 475013
CHASIS # 032725, Motor # 475037
CHASIS # 032625, Motor # 475924
CHASIS # 032624, Motor # 473899
CHASIS # 032623, Motor # 473851
2/The following 10 vehicles (7 commercial truck vehicles whose chasis and motor numbers are mentioned below and 3 other trucks whose chasis and motor numbers are not yet identified) registered under MFAM Private Limited Company, soliciting a 19% discount rate:
CHASIS # 061570, Motor # 538498
CHASIS # 061243, Motor # 537161
CHASIS # 061379, Motor # 536670
CHASIS # 061315, Motor # 538356
CHASIS # 061314, Motor # 537914
CHASIS # 065821, Motor # 545092
CHASIS # 065761, Motor # 545153
Where as Defendant #3, influenced the General manager of AMCE, Mr. Franco Marnlin, through other company managers, to help Defendant #5 secure the discount rate and import the vehicles; where as Defendant #7, having been entrusted with the power to represent the Ethiopian Government in AMCE, undermined his position insidiously by successfully influencing the General manager of the company to issue the discounts and benefit Defendants #5 and #6; where as, Defendants #5 and #6, taking advantage of the powers entrusted to Defendant #3, influenced the company's employees to purchase five commercial vehicles in October 1997G.C, and 10 more commercial truck vehicles between the period January - April 2000. The vehicles, having been purchased illegally all Defendants are then charged for conspiring and soliciting to benefit from the illegal act mentioned, in a manner that abused the power entrusted to them by the people.
Statement of Offence 4: for Defendants #3, #8 and #10 only.
The prosecutor charges the Defendants as follows:
The Defendants are charged for violating the 1957 Ethiopian Penal Code article #32/1/9//b/, article 33/36, and the revised Special Penal Code, proclamation #214/1981, article 23/1/b/c.
Particulars of Offense
Defendant #3, while working as Minister of Defense of the Transitional Government of Ethiopia; and Defendant #10, while working as Vice Minister of Health of the Transitional Government of Ethiopia, pursued an illegal act to favor Defendant #8; where as Defendant #3 influenced Defendant #10 so as to secure an employment position at the Addis Ababa Ministry of Health office for Defendant #8. Defendant #10, undermining the powers entrusted to him by the people and violating the government's guidelines for hiring or recruiting employees, ordered/authorized employment of Defendant #8 at the Addis Ababa Ministry of Health Office. Defendant #8, taking advantage of the powers entrusted to Defendant #3 secured herself employment position at the aforementioned ministry and benefited illegally; where as all the Defendants are then charged for conspiring and soliciting to benefit from the illegal act mentioned, in a manner that abused the power entrusted to them by the people.
Statement of Offence: for Defendants #1, #6 and #11 only.
The prosecutor charges the Defendants as follows:
The Defendants are charged for violating the 1957 Ethiopian Penal Code article #32/1/a/1b/, article 33 and the revised Special Penal Code, proclamation #214/1984, article 23/1/b.
Particulars of Offense
Defendant #1, while working as head of the Public Enterprise Supervising Authority, pursued an illegal act to favor Defendant #5; where as Defendant #1 influenced the late Mr. Teka Wagaw, the then General Manager of Meta Abo Brewery, as to help Defendant #5 secure Meta Abo's Distribution Agency Contract for Temben district in Tigray. Defendant #1 authorized Mr. Teka through the telephone, to revoke Defendant #5's former business partner's (Hagos Hdera's) distribution agency contract without any legal reasons; thus disadvantaged the aforementioned victim by doing so, Defendant #5, taking advantage of the power entrusted to Defendant #1 secured himself the sole distribution agency and benefited illegally. All the Defendants are then charged for conspiring and soliciting to benefit from the illegal act mentioned, in a manner that abused the power entrusted in them by the people.
Statement of Offense 6: for Defendants #1, #2, #11 and #12 only.
The prosecutor charges the Defendants as follows:
The Defendants are charged for violating the 1957 Ethiopian Penal Code article #32/1//1//b/, article 33 and the revised Special Penal Code, proclamation #214/1981 article 23/1//b/.
Particulars of Offense
Defendants #1 and #2, while working as Board Chairman, Board Secretary and General Manager of the Ethiopian Privatization Agency respectively, pursued an illegal act to favor Defendants #11, #12 and other accomplices - share holders and General Managers of different business establishment - whose relationship towards each other, among other things, is of blood, mutual benefits and affinity. Defendants #1 and #2, while working from 1987 - 1993E.C in the aforementioned positions are charged for pursuing the following illegal act:
Count 6.1:After Bid # 03/1990 was issued to privatize St. George Brewery, and the Agency's Bid Evaluation Committee and the Management Board declared and approved respectively, Gomba Group of Companies as winner of the two finalists, the decision was reverted favoring BGI, the seemed bidder, who lost on the original pre-sales-contract signing negotiations, justifying that BGI raised its offers from US$ 4 million to US$ 7.5 million; where as after this offer was presented to the committee and was rejected again, the company's final offer of US$ 10 million - although there wasn't any offer as such - was presented to the Agency's Management Board meeting as an agendum; where as in a manner that violates the bid procedure, and without first consoling Gomba's US$ 10 million offer and completely ignoring Gomba's pre-conditions and final offer of US$ 10.75 million (an offer to be executed effective September 27, 1998), the brewery was sold to BGI for US$ 10 million, in a manner that illegally favored and benefited BGI.
Count 6.2:After bid # 004/87 was issued to privatize the Debre Zeit Flour Mill and the offer made by the two contending bidders was rejected by the Bid Evaluating Committee for being lower than the indicative/floor price of Birr 8,678,246.00 (Eight million six hundred seventy eight thousand two hundred forty six Birr); and considering that the indicative floor price itself was actually low and that the mill's capacity to grind wheat - other than maize - was understated, the mill was sold at Birr 8 million to Defendant #11 on the 10th of August, 1987 E.C in a manner that illegally favored and benefited Defendant #11.
Count 6.3After bid offer #01/1989 was issued to sell Gulele Soup Factory, the two contenders, Mr. Duguma Hunde and Mr. Getu Geleteu on one hand, and Defendant #12 on the other hand offered to buy 100% and 51% ownership of the factory respectively; where as the Agency's Bid Evaluation Committee after declaring Mr. Duguma Hunde and Mr. Getu Geletu's offer of Birr 21,556,000.42 for 100% ownership of the factory as winner of the bidding contenders, the Board reverted the decision, supporting and illegally favoring Defendant #12, who was supported to raise his ownership offer from 51% to 100%, and was able to buy the factory on January 5, 1989E.C. accordingly.
Count 6.4While the Ethiopian Orthodox Church's appeal on its ownership right over Harar Printing Press was still under investigation by the Privatization Agency and while the final decision on this issue was still pending; and in a manner that illegally favors Defendant #12, the only bidder for the Agency's publicly notified tender in bid # 004/87 for the printing press, the aforementioned Defendant was allowed to illegally buy the printing press on December 29, 1988 E.C., after allowing the Defendant to raise his initial offer of 75% to 100% ownership, and extending the three month bid offer further than is constituted on the bid document.
Count 6.5In a bid that was issued to sell Taitu Hotel, where professionals did not participate in estimating the price and where a low floor price was set to illegally favor the sole bidder, Defendant #12, and ignoring the value of the 505 national antiques that were registered by the Ministry of Information and Culture in the valuation, documentation and property transfer process, the hotel was sold to the aforementioned Defendant on June 21, 1991E.C, in a manner that undermined public interest; where as Defendants #1 and #2, taking advantage of the power entrusted to them by the people, and in a manner that illegally benefited Defendants #11 and #12, all Defendants are then charged for conspiring and soliciting to benefit from the illegal act mentioned, and the abuse of power entrusted to them by the people.
REMARK
This indictment is issued based on Federal Courts Proclamation # 25 1996 article 8/1/1 and the Anti-Corruption Special Procedure and Rules of Evidence Revised Proclamation #239/2001 article #51.
appendix 2.3the charges against ato belete alemayehu et al
(the sugar state managers)
Date: 06/05/02
The Federal Democratic Republic of Ethiopia
To The Federal High Court
The First Penal Bench
Addis Ababa
The Federal Ethics and Anti-Corruption Commission
Prosecutor Penal Register No. 004/94
The Federal High Court Penal Registry No. 541/94
Indictor:The Prosecutor of The Federal Ethics and Anti-Corruption Commission
Defendants:1st Belete Alemayehu Kassaye
Age:47
Occupation:Manager of Mathara Sugar Factory
Address:East Oromiya Fentale Wereda Methara Town
within the Compound of the Sugar Factory.
2nd Solomon Baraki
Age:
Occupation:Manager of Wonji Shoa Sugar Factory
Address:
3rdBrhanu Jijo Anbesse
Age:42
Occupation:Manager of Wonji-Shoa Sugar Factory
Address:East Oromiya Adama Wereda within the
compound of Wonji-Shoa Sugar Factory
4thShoaferaw Girma Wesen
Age:52
Occupation:Manager of Ethiopian Sugar Industry Support
Center Share Company.
Address:Addis Ababa, Wereda 17, Kebele 17, House # 147
5th Demelash Arega Werkineh
Age:36
Occupation:Commercial Department Head of Ethiopian Sugar
Industry Support Center Share Company.
Address:Addis Ababa Wereda 10, Kebele 02, House No. 777
Charge No. 1:Only on the 1st, 2nd and 3rd Defendants.
The Offense:
In violation of the 1957 Ethiopian Penal Code No. 32(1)(A) and the 1974 Revised Special Penal Code proclamation No. 214/1974 article 23(1)(A) and (B).
Particulars of the Offense
From October 1994 to 1997, the 1st Defendant was working as Manager of Methara Sugar Factory and the 2nd and 3rd Defendants were working as the managers of Wonji Shoa Sugar Factory. An instruction has been issued by the Office of The Prim Minister. It was written on October 13,1994 with reference no. "M30-ATs 3/01/08". The instruction was stating that the sugar that is being produced by the factories must be sold in an open tender. In accordance to this instruction, the tender committee members that was formed from the factories have conducted 75 tenders out of which the defendants have approved 73 of them while the remaining two were canceled. This was done from 22/10/94 - 24/09/98 and in the process of the approval of these tenders.
1.1To properly perform the sales of sugar in an open tender it was expected from the Defendants to prepare on internal tender procedure in line to the Governments guide line and directives showing :
How the tender will be issued and implemented.
How the tender committee members will be elected and their responsibilities and,
The procedure of tender cancellation.
But they failed to do this and has been performing the tender without proper control, unprocedurally changing committee chairpersons and members, carelessly performing the evaluation of the tenders and approving.
1.2The meeting of December 12, 1995 passed a decision that any tenderer can buy minimum 5000 quintals and maximum 15,000 quintals. This was done with the intent of controlling monopoly on the sugar trade. This decision was followed until the 52nd tender. But the 1st and 3rd Defendant changed the minimum quantity to 1000 quintals and lifted the upper limit as of the 53rd tender with the intent of supporting few capable organizations to monopolize the sugar market. As a result of the change of the previous practice they have made:
A/Mina Trading PLC:Purchase sugar in tenders No. 53-64 and 67 - 75.
B/Tiss Abay PLC:Purchase sugar in tenders No. 53-74.
C/Tedi PLC:Purchase sugar in tenders 53 - 55,59,68,69,70&71
D/Ajema Ethiopia:Purchase sugar in tenders 53-55,59,62-71,73 & 74
E/Star Business Group:Purchase sugar in tenders 53-57,59,60,62,68-75
1.3When Dinsho PLC faild to settle the remaining payment to the 156,000 quintals it purchased in tender No. 2 and lift the sugar from Methara and Wonji-Shoa Sugar Factories, the tender committee on its meeting of February 1, 1995 decided that the Birr 4,371,840 (four million three hundred seventy one thousand eight hundred forty birr) bid bond should be confiscated. To this effect a letter was written to the organization on 02/02/95, with reference no. 16/21/454 stating the transfer amount of:
Birr 3,060,288 (three million sixty thousand two hundred eighty eight Birr) for Methara Sugar Factory account,
Birr 1,311,522 (one million three hundred eleven thousand five hundred twenty two Birr) for Wonji-Shoa Sugar Factory account
The 1st and 2nd Defendant interfered in the authority of the committee and decided in-appropriately and the money was paid back to Dinsho PLC.
All the three Defendants have used their authority beyond the limit and this has caused damage to the benefits of the government and are charged for abuse of power to commit corruption crime.
Charge No. 2:Only on the 2nd Defendant.
The Offense:
In violation of the 1974 revised special Penal Code proclamation no 214/1974 article 23(1)(A).
Particulars of the Offense:
When the 2nd Defendant was working as the manager of Wonji Shoa Sugar Factory he has instructed the sales of 700 quintal of sugar for the workers of Wonji-Shoa for Birr 175,000 (one hundred seventy five thousand Birr) without tender by the letter dated 07/11/94 Ref. No. 01/062/8-9.
This was done in violation of the instruction given by the Office of The Prime Minister in its letter of October 13, 1994 Ref. No. "M30-ATs3/01/08", which states that sugar product sales must be performed in an open tender. He is then charged for abuse of power to commit corruption crime.
Charge No. 3:Only on the 4th Defendant.
The Offense
In violation of the 1974 Revised Special Penal Code proclamation No. 214/1974 article 23(1)(B).
Particulars of the Offense
The Defendant was working as the manger of Ethiopian Sugar Industry Support Center Share Company from October 1997 to April 2001;
3.1An instruction letter has been issued from the Office of the Prime Minister on October 13, 1994 reference No. "M30-ATs3/01/08" instructing him to perform the sales of sugar in an open tender. To implement this instruction appropriately he was given the legal authority to prepare procedures as how the tender is to be issued, how the tender committee members are to be appointed and how they will approve or cancel the tenders. He violated this instruction and performed the sugar tender with out internal procedures for tender sales.
3.2Star Business Group was supposed to pay Birr 10,695 (ten thousand six hundred ninety five Birr) for storage due to its failure to collect the sugar it has purchased in tender No. 12. Due to the letter written on April 17,1991 Ref. No. 01/75/435-3 by the Defendant the payment was not effected.
3.3Violating the instruction written by the Office of the Prime Minster on October 13, 1994 Ref. No. "M30-ATs3/01/08" which states that sugar must be sold in an open tender, he has sold 80 quintals for Birr 32,000 (thirty two thousand Birr) without tender to the Ministry of Defense as per their request letter of February 13, 1998 Ref. No. M/4-1/711+12/266.
3.4As per the government guide line the payment of the export sugar of the year 2000/01 was to be done by letter of credit to be opened for the center through the National Bank of Ethiopia:
A/Soyama Impex with bank credit advance Birr 846,866 (eight hundred forty six thousand eight hundred sixty six Birr) and by cash payment order (CPO) Birr 2,363,911 (two million three hundred sixty three thousand nine hundred eleven Birr) in cash and check Birr 241,570 (two hundred forty one thousand five hundred seventy Birr);
B/Miftah Kemal by telegraphic transfer Birr 407,300 (four hundred seven thousand three hundred Birr), by cash payment order (CPO) Birr 1,685,833 (one million six hundred eighty five thousand eight hundred thirty three Birr), in total Birr 2,093,133 (two million ninety three thousand one hundred thirty three Birr);
C/Taye/Yesu Trading by cash payment order (CPO) Birr 325,319 (three hundred twenty five thousand three hundred nineteen Birr);
D/Yegeta Trading by telegraphic transfer Birr 7,847,760 (seven million eight hundred forty seven thousand seven hundred sixty Birr) by cash payment order (CPO) Birr 6,419,815 (six million four hundred nineteen thousand eight hundred fifteen Birr) in total Birr 14,267,575 (fourteen million two hundred sixty seven thousand five hundred seventy five Birr);
has made the payments to be effected through the above listed an acceptable form of payment.
3.5Due to his failure to arrange a proper control system for the export product that was produced with high attention and cost, until April 2001.
A/From the 120,971.5 quintals that was expected to pass to Kenya through Moyale 29,357.5 quintals did not leave the country.
B/From the 800,000 quintals that was expected to be taken to Djibouti by Kahan International, 274,210 quintals did not leave the country.
This has resulted in the sales of the sugar locally at higher prices and disturbed the local market.
Since he has abused his power to the effect of damaging the interest of the government, he is charged for committing corruption crime.
Charge No. 4:On the 5th Defendant
The Offense
In violation of the 1974 Revised Special Penal Code proclamation No. 214/74 article 23(1)(B).
Particular of the Offense
The 5th defendant when working as the commercial department head of the Ethiopian Sugar Industry Support Center Share Company, has inappropriately transferred the cash payment order (CPO) of Star Business Group who was not a participant in the tender which was prepared in the name of Ethiopian Sugar Factory Industry Support Center Share Company for an amount of Birr 3,000,000 (three million Birr) by the Wegagen Bank; to Tiss Abay Private Limited Company who was a winner in tender No. 58.
As a result of allowing this payment transfer he has abused his power resulting in damaging the interest of the government and therefore is charged for committing a corruption crime.
Abuhay Guade
Prosecutor of the Commission
3.THE RESTRAINING ORDERS
APPENDIX 3.1THE APPLICATION BY THE POLICE OFFICER AND THE RESTRAINING ORDERS GIVEN AGAINST ATO ASSEFA ABRAHA ET AL, BY THE FEDERAL SUPREME COURT
The Application
No.: MM/WK/8784/93
Date: July 16, 2001
To The Federal Supreme Court of
The Federal Democratic
Republic of Ethiopia
Registration no. of the
Federal Supreme court # 6754, 6756
Main Division of Investigation
Co-ordination
Crime Investigation Department of
The Federal Police
Indictor:The Law
Defendants:1st, Assefa Abraha Hagos, who was head of the office of Public Enterprises Supervising Authority of the Federal Democratic Republic of Ethiopia with a rank of a Minster and Board Chairman of Ethiopia Privatization Agency and Commercial Bank of Ethiopia;
2nd Ato Mihreteab Abraha Hagos;
3rd Ato Fitsumzeab Asgedom W/Michael
4th Mr. Hrayer Behensineyan;
5th Ato Fiseha Abraha Hagos;
6th Ato Beshah Azmite, who was the General Manager of Ethiopian Privatization Agency & the Board Secretary and member of the Agency.
7th Ato Seeye Abraha Hagos, who was member of the House of Representatives of the Federal Democratic Republic of Ethiopia, Board Chairman of Ethiopian Airlines, Ethiopian Telecommunication Corporation and EFFORT;
In compliance to the Anti-Corruption Special Procedure and Rules of Evidence Proclamation No. 236/2001 (as amended) article 3,5 & 6, an Application submitted for a Restraining Order presented with an Affidavit before the establishment of the criminal charge.
1.The 2nd Defendant Ato Mihreteab Abraha and the 5th Defendant Ato Fiseha Abraha with the 7th Defendant Ato Seeye Abraha who was member of the House of Representatives and the 1st Defendant who was Head of the Office of Public Enterprises Supervising Authority with the rank of a Minister, are suspected to be accomplices to a corruption criminal act and are currently under arrest.
2.The 3rd Defendant Ato Fitsumzeab Asgedom and the 4th Defendant Mr. Hrayer Behensineyan with the 6th Defendant Ato Beshah Azmete and the 1st Defendant Ato Assefa Abraha Hagos are suspected to be accomplices to a corruption act and currently under arrest.
As per Proclamation No. 25/1996 article 8 sub article 1, and Proclamation No. 236/2001 Article 51(1) (as amended) the court has the authority to see the case.
A/Material Fact to the Charge
1.The 1st, 3rd, 4th and 6th Defendants with corrupt relationships have participated in inappropriate sales and purchase of Harar Printing Press, Gulelle Soap Factory, Taytu Hotel & Debre Zeit Flour Factory (later named Debre Zeit Food Industry) in contravention to the directives of the government.
1.1While the Privatization Agency and its Board have confirmed the extra-judicial nationalization of Harar Printing Press and while the claims of the Ethiopian Orthodox Church for restitution was under evaluation and decision was not yet given;by the order of the 1st Defendant it was sold by an illegal tender to the 3rd Defendant who is his brother-in-law. Due to the corrupt relationships they have got with the 1st, 2nd, 5th, 6th, 7th Defendants this printing press which he purchased illegally was pledged as bank guarantee for MFAM Trading.
1.2On the tender floated to sell Gulelle Soap Factory, where two bidders participated and whereas the bidder marked to be the winner of the tender by the Bids Evaluation Committee is discarded and engaging in an illegal negotiation wit the 3rd Defendant and have it approved by the board sold the factory to the 3rd Defendant. Besides the 1st and 6th Defendant have played a major role on the illegal discount from that of the price that was stated in the tender document.
1.3Whereas it has been decided that Taitu Hotel should be sold on a tender and that the floor price is set to Birr 12 million and while an offer of Birr 15 million is submitted, in the disguise that there is no interested buyer for the hotel the floor price has been lowered to 5.3 million Birr and claiming to have only one bidder it was sold inappropriately to the 3rd Defendant. In the course of this sale, major role was played by the 1st Defendant who is the brother-in-law of the buyer and the chairman of the board and the 6th Defendant who was the manager of Privatization Agency.
1.4While Debre Zeit Food Industry is earmarked for sale on tender, the management board of the factory got the factory valued by experts at over Birr 18 million.
However, despite this value and the different high values given by the valuation experts of the agency, for the sake of benefiting the buyer, the lowest floor price estimate of 8.7 million Birr was selected. Taitu, when it was tendered with this floor price two bidders participated (including the 4th Defendant) and as both bidders offered below the floor price, the management board of the factory commented that the tender should be canceled by the tender committee since the selected price for the sales was extremely low, and in addition while the management board of the factory and the labor union and the federation were mentioning that the factory has started milling wheat and is transformed from a money losing enterprise to a profitable one and as a result can fetch more value than was offered earlier and stating their objection of the price approved by the board of the agency in their letter to the 1st and 6th Defendants by stating the reason that the factory is a loss maker, the Defendants rejected the objection of the management board of the factory and the opinion of the tender committee and the factory was sold inappropriately to the 4th Defendant.
2.Using their authority and influence the 1st and 7th Defendants have made their brothers the 2nd and 5th Defendants receive inappropriate benefits. Accordingly:-
2.1In an illegal way, without following the procedures of the loan service of the bank, and also by presenting collaterals with exaggerated valuation and as a result of the telephone and verbal order of the 1st Defendant to the heads of the Commercial Bank of Ethiopia, the 2nd Defendant inappropriately received a loan of over 5 million Birr from Commercial Bank of Ethiopia, Bole Branch.
2.2The owners of MFAM the 2nd & 5th Defendants using the influence of the 1st and the 7th Defendant and by exaggerating the value of the properties used as collaterals without following the procedures of the bank conspiring with the authorities of the bank secured loan of Birr 4,650,419 (four million six hundred fifty thousand four hundred nineteen Birr) on April 26, 2000 from the Commercial Bank of Ethiopia, Bole Branch knowingly that the government has 30% share in AMCE company were made to receive 19% price discount in the purchase of 10 trucks from this company.
2.3Trans-Ethiopia, which is one of the sister companies of EFFORT, while importing over 200 vehicles at a substantially reduced price in Lire with the agreement that it has with IVECO, was favored with a special discount because of the high volume of the purchase and, on the basis of instruction given by the 7th Defendant, who is a high government official as well as the overall head of EFFORT, for the special discount to be extended to his brother too. His brother, the second Defendant, was assisted to obtain a discount of Birr 250,000 (two hundred an fifty thousand Birr) per vehicle in the name of Trans-Ethiopia company in an improper and illegal purchase of the 5(five) vehicles.
B/Steps Taken and Status of the Case
1.Search has been made according to court instruction.
2.Various documentary evidences have been collected and they are being categorized and scrutinized.
3.Work is progressing as what experts and other witnesses have to say is being registered.
As the case is complicated and extended, the investigation is yet to be completed, and hence, couldn't press charges.
C/The properties were obtained by corruption
1.Documentary evidences collected and witnesses identified attest that the 1st, 3rd, 4th and 6th Defendants, having conspired for a benefit, have improperly participated in the sale and purchase of Harar Printing Press, Gullele Soap Factory, Taitu Hotel and Debre Zeit Flour Mills in contravention of government directives.
Accordingly:-
1.1While the Agency and the minutes of the Agency's board of management confirm that Harar Printing Press was confiscated in violation of the relevant nationalization proclamation, correspondences of the Ethiopian Orthodox Church that were written to indicate that the factory was illegally nationalized and that it should be returned to its owner and witnesses presented confirm the same. In addition, the minutes of the Agency's board of management confirm that instruction was given by the 1st Defendant for the sale of the printing press before decision was reached on the claim for restitution.
1.2Minutes of the tender award committee as well as documents obtained from the Agency and testimonies of witnesses indicate that Gulelle Soap Factory was improperly and in an illegal way sold to the 3rd Defendant on pressure applied by the 1st and 6th Defendants.
1.3The following points prove the significant role played by the 1st Dependent, who is brother of the purchasers wife, and the general manager of the Privatization Agency, the 6th Defendant, in the sale of Taitu Hotel to the 3rd Defendant at a low price.
Testimonies of witnesses who applied to purchase the hotel for 15 million.
minutes of the board showing the statement of the board member that the hotel should be retendered.
documents collected to show that title deed was transferred to the 3rd Defendant before 70% of the payment was effected.
1.4About the improper sale of the Debre Zeit Food Industry below its price:
document of the labor union addressed to the Prime Minister's Office, Privatization Agency and other bodies objecting the sale.
correspondence of the board of management of the factory, objecting the sale.
documents indicating that the 4th Defendant was lending money to the 2nd Defendant and that there was a relationship between the two in this regard.
the Auditor General's performance audit report on the factory indicates that the factory was sold improperly.
2.Various documentary evidences and witnesses confirm that the 7th Defendant used his authority and influence to enable the 2nd and 5th Defendants, who are his brothers, benefit illegally.
Accordingly:
2.1Inspection report sent from the Commercial Bank of Ethiopia shows that the 2nd and 5th Defendants repeatedly took loans from the Commercial Bank of Ethiopia in an illegal way.
2.2Witness testimonies and documents written by AMCE show that the 2nd and 5th Defendants, who are owners of MFAM, have improperly secured loan from Bole Branch and, in addition have improperly obtained 19% price discount from AMCE in the purchase of 10 vehicles.
2.3AMCE's price related letter and witness testimonies show that, on the basis of instruction given by the 7th Defendant, an unusual discount of over two hundred and fifty thousand Birr (250,000) was made for the 2nd Defendant and that he improperly and illegally imported five vehicles.
3.The properties obtained by the suspects in the corrupt ways described above and the money they improperly made using the properties in the course of their business activities have been partly deposited in banks and partly used for the acquisition of other properties.
3.1A letter written by the Commercial Bank of Ethiopia demonstrates that Birr 13,849.89 (thirteen thousand eight hundred forty nine and eighty nine cents) obtained by Ato Assefa Abraha in the corrupt ways described above is deposited in his name and in the name of Rebecca Mengesha (his wife).
3.2Documents sent from the Commercial Bank of Ethiopia and Abyssinia Bank confirm that a loan of Birr 1,306,110.71 (one million three hundred six thousand one hundred ten and seventy one cents) Ato Mihreteab Abraha has taken in an illegal way, Birr 28,348.24 (twenty eight thousand three hundred forty eight and twenty four cents) has been deposited in a bank account registered in his names, Birr 2,444.81 (two thousand four hundred forty four and eighty one cents) in a bank account registered in the name of MFAM and Birr 500,000 (five hundred thousand) has been invested in shares of Abyssinia Bank.
3.3Documents sent from banks confirm that the money that the 3rd Defendant, Ato Fitsumzeab, acquired from the business activities of Taitu Hotel, Harar Printing Press and Gulelle Soap Factory, which enterprises he purchased illegally, and the money he obtained through improper and illegal way of borrowing is deposited and found in banks.
3.4The 4th Defendant, Hrayer Behensineyan, for an illegal purchase of Debre Zeit Food Industry using the bank loan fund secured through benefiting his other companies;for acquiring additional bank loan of Birr 19 million mortgaging again the factory bought at a low price (not more than Birr 10 million); for engaging in business and the money he illegally obtained from the bank is deposited in a bank account and this is certified by the documents received from the bank. Moreover, apart from the factory and business illegally acquired, the loan fund he illegally secured at different times from the bank is deposited in various accounts under the names of Hagbes, Sivita Real Estate, Ultimate Motors and Beza Private Limited Company in various branches of Commercial Bank of Ethiopia. He has deliberately deposited a very small amount of money under the name of Debre Zeit Food Industry.
3.5The 5th Defendant, Ato Fisseha Abreha, while working as the manger of MFAM P.L.C., the money he illegally acquired is deposited in a bank account and it is certified by the documents we have received from the bank.
| List of Property and Address |
No.Owner of Property of which restraining order is requestedAddressType of PropertyPlate No.1Mehreteab AbrehaAddis AbabaVehicle3-42401- Truck2 3-42402- Truck3 3-43387- Truck4 3-43388- Truck5 3-43389- Truck6 3-43385- Truck7 3-46119- Truck8 3-46940- Truck9 3-49753- Truck10 3-06036- Trailer11 3-06816- Trailer12 3-06813 -Trailer13 3-06690- Truck14MFAM Trading PLC 3-52659- Truck15 3-52657- Truck16 3-52656- Truck17 3-49097- Truck18 3-49098- Truck19 3-49099- Truck20 3-49100- Truck21 3-49101- Truck22 3-52360- Truck23 3-52361- Truck24 3-52544- Truck25 3-08615 -Trailer26 3-08614- Trailer27 3-08613- Trailer28 3-08002- Trailer29 3-08003- Trailer30 3-08004- Trailer31 3-08005- Tillers32 3-08006- Trailer33 3-08564- Trailer34 3-07102- Trailer
Lieutenant Belete Kitesa
Coordinator of Investigations and Operations.
NoName of BuyerProperty of Which Restraining order is requestedSellerAddress1Fitsumzeab AsgedomGullele Soap FactoryThe Privatization AgencyAddis Ababa Wereda 82Fitsumzeab AsgedomTaitu HotelWereda 23Fitsumzeab AsgedomHarar HotelHarar Wereda 3, Kebele 094Mr. Hrayer BehensineyanDebre Zeit Food IndustryDebre Zeit City
Lieutenant Belete Kitesa
Coordinator of Investigations and Operations.
No.Owner of AccountAmount of MoneyDeposited in ___ BankAccount No.RemarksAssefa Abreha1Assefa Abreha13,849.89Commercial Bank of Ethiopia Meskel Branch32911.1Assefa Abreha and/or Rebecca Mengesha72,358.84Commercial Bank of Ethiopia Meskel Branch18992Meheteab Abreha2.1Mehreteab Abreha1,306,110.71Commercial Bank of Ethiopia Bole Branch100992.2Mehreteab Abreha28,063.39Commercial Bank of Ethiopia Bole Branch18442.3Mehreteab Abreha500,000.00Shares in Abyssinia Bank2.4MFAM Trading1,453.06Commercial Bank of Ethiopia Bole Branch348MFAM Trading991.75Cherkos Branch2477
Lieutenant Belete Kitesa
Coordinator of Investigations and Operations.
No.Owner of AccountAmount of MoneyDeposited in ___ BankAccount No.Remarks2.5Mehereteab Abreha284.85Commercial Bank of Ethiopia; Air Marefia Branch24723Fitsumzeab Asgedom3.1Fitsumzeab Asgedom15,843.81Commercial Bank of Ethiopia, Bole Branch19811Fitsumzeab Asgedom216.68Sengatera Branch12943.2Fistumzeab Asgdom (Harar Printing Press)301.41Bole Branch1603.3Fistumzeab Asgdom (Gulele Soap Factory)1,852.50Bole Branch1593.4Fistumzeab (Taitu Hotel)152,360.02Mahteme Ghandi Branch1444
Lieutenant Belete Kitesa
Coordinator of Investigations and Operations.
No.Owner of AccountAmount of MoneyDeposited in ___ BankAccount No.RemarksFitsumzeab Asgdom (The Yellow Pages6,650.16Commercial Bank of Ethiopia, Sengatera Branch1182Fistumzeab Asgdom Wolde Michael9,413,920.28Bole Branch99999Fitsumzeab (Vision Ethiopia)32,108.70Mahteme Ghandi Branch14334Hrayer Behensineyan4.1Hrayer Behensineyan (Debrezeit Food Industry)259.25Debrezeit Branch1099Hagbes Hrayer Behensineyan22,180,268.43Arada Branch839Hagbes Hrayer Behensineyan170,497.98Cherkos Branch2403
Lieutenant Belete Kitesa
Coordinator of Investigations and Operations.
No.Owner of AccountAmount of MoneyDeposited in ___ BankAccount No.RemarksUltimate Motors Hrayer Behensineyan572,847.09Arada Branch2350Beza P.L.C.6,376,406.21Arada Branch23715Fisseha Abraha5.1Fisseha Breha 15,207.09Dashen Bank Mekele Branch50110810045.2Fisseha Abreha 3,692.86Wegagen Bank Mekele Branch626
Mehereteab Abraha enterprise is privately owned by Ato Meheretab Abraha Hagos and it is a company established with one million Birr capital registered with the contribution of 750,000 Birr of Mehereteab Abraha, 150,000 Birr of Fisseha Abreha and 100,000 Birr of Ajebnesh Samson (spouse of Ato Mehereteab Abraha)
Etegue Taitu Hotel (formerly known as Taitu Hotel) enterprise has 2000 shares, out of which, 1800 shares belong to the Yellow Pages P.L.C. and the remaining shares belong to Articraft P.L.C. (both belong to Ato Fitsumzeab)
The Yellow Pages company has 500 shares, out of which, 490 shares belong to Ato Tesema Asgedom and the remaining 10 shares belong to Ato Seyfe Asgedom. However, since the shares (490) where transferred from Ato Fisumzeab Asgedom to Ato Tesema Asgedom on May 10, 2001 G.C. and the notary office authenticated this on June 26,2001 G.C., we, therefore, request a restraining order to be effected in compliance with the law.
From the shares owned by HAGBES Company the following own:-
1.Mr. Hrayer Behensineyan 2225 shares or Birr 970,000.00
2.Child Sivag Hagen Behensineyan 25 shares or Birr 10,000.00
3.Child Talrmery Behensineyan 25 shares of Birr 10,000.00
4.Child Behenkeriana Behinsilyan 25 shares or Birr 10,000.00
Since we have not yet received information on the particulars of ownership on the rest of enterprises lodged for restraining order, we, therefore, state that we will submit the particulars to the honorable court as we receive it.
Ruling being requested
The documentary evidences collected and the statements that of witnesses will attest that the properties owned individually by the aforementioned suspects or under their registered companies are acquired through corrupt practices. In this regard, until the investigation underway is completed and with ruling of the court of law, the properties are resituated to the rightful owner; we hereby request the honorable court, to restrain the suspects from their rights of ownership on the properties; the factories along with their vehicles and their working capital, to freeze funds registered in private banks, to appoint receivers on the properties and administer them as stipulated on article 12 to 15, Proclamation No. 236/2001.
If this application for restraining order reaches a 3rd party, it can severely damage the confidentiality of the investigation and hamper the course of investigation. We, therefore, request the honorable court to take this into consideration and possibly give instructions to file this along with the police investigation dossier.
With greetings,
Lieutenant Belete Kitesa
Coordinator of Investigations and Operations
the restraining orders
Criminal Charge File # 6756
July 19, 2001
Federal Democratic Republic of Ethiopia
Federal Supreme Court
Judges:Fesseha Workneh
Mekdes Tesfaye
W/Michael Meshesha
Getachew Mihretu
Getachew Akosa
Applicant :The Federal Ethics and Anti-Corrutpion Commission
1)Mr. Assefa Abraha
2)Mr. Mereteab Abraha
3)Mr. Fistumzeab Asgedom
4)Mr. Hrayer Behensenian
5)Mr. Fisseha Abraha
6)Mr. Beshah Azmte
7)Mr. Seeye Abraha
Based on the applicant's affidavit, (dated July 18, 2001 and registered as 8784/93) applying for restraining order, the court, after investigating the file, hereby issued the following order:
Order
Whereas, the applicant in its affidavit indicated that the respondents, having been suspects and accomplices to a corruption crime and disregarding the government directives conspired to buy and sale the Gulelle Soap Factory, Taitu Hotel and the Debre Zeit Flour Mill Factory (Debrezeit Food Industry); whereas, in particular, Defendants #1 and #7, using the power entrusted to them conspired with Bank officials to assist Defendants #2 & #5 and facilitated bank loans from CBE's various branches by accepting exaggeratedly valuated collaterals. The suspects further purchased ten vehicles at a discount rate of 19% from AMCE - an enterprise where the government owns 30% of the total shares. Thus, the individuals, having been suspects for the aforementioned activities are currently under arrest.
The applicant, further claiming that the evidence gathered so far indicate that the assets registered under the individuals' and enterprises' names were acquired through corrupt practices, and citing Proclamation # 236/93, Article 8/1 and 2/4, requested the court to grant a restraining order for the following:
-to restrain the suspects from their rights of ownership to their assets,
-to freeze the enterprises' working capital, to grant a restraining order on the factories and vehicles and to appoint receivers to administer the properties.
-to freeze the individual accounts.
After deliberating on the specifics of the law and the applicant's request, the court, unless otherwise issues a new ruling, orders the following:
1/The amount of money indicated alongside the names of the individual suspects mentioned within pages 6 through 7 of the application letter;
-The money registered under share capital; the money deposited under the aforementioned names of the various factories and individuals within the CBE and other Ethiopian Banks;
2/The assets indicated within pages 7 through 8 of the application letter; the assets indicated on page 9 of the applicant's letter;
3/Money deposited under MFAM Trading accounts; money deposited under Fitsumzeab's account and the factories bank and cash accounts
The court hereby grants the applicant a restraining order on the aforementioned assets, individuals and factorys' accounts; this order shall be forwarded to all concerned parties:
-any appeal or request shall be seen by the count in the future.
-the court order shall be attached to file Criminal Charge File 6754.
-this court order is granted based on the majority votes casted.
Signature of the Judges:Fesseha Workneh
Mekdes Tesfaye
W/Michael Meshesha
Getachew Akosa
N.B.
1)The 6th and the 7th suspects had neither property to be restrained nor bank accounts to be blocked. Their names are included for no purpose.
2)The bank accounts stated as belonging to the 1st suspect, Assefa Abraha Hagos, were later on proven to belong to another family with a similar name (name sake) and hence rectified.
I have dissented only on the issue of freezing the bank accounts for the following reasons:
1.The owners of these various properties are entitled to have enough money for their various activities. Denying them such rights will contribute to having their establishments run out of business; and that consequently affects the nation's economy. The ruling, among other things will jeopardize the welfare of their employees and other third party beneficiaries. In a situation where the charges are not yet established, the ruling could have considered to verify whether or not sufficient money is available for both the individuals' welfare and their business expenses. The accounts should not be frozen without such deliberation.
2.Other than the amount in their aforementioned accounts, it must have been verified whether or not the individuals do have other financial resources.
3.Prior to such rulings, it must be verified indisputably and by conclusive evidence whether or not the money in the aforementioned accounts are acquired by corrupt practices.
4.In addition to the affidavit, other evidence must have proved whether or not the aforementioned amount of money is actually in the bank.
The judges signature:Getachew Mihretu
Signed
Date:19/04/2001
APPENDIX 3.2THE RESTRAINING ORDER GIVEN AGAINST ATO MENWUYELT ATINAFU ET AL, BY THE FEDERAL HIGH COURT
Federal Democratic Republic of Ethiopia
Federal High court
Judges
Girma Tilahum
Medhin Kiros
Elisa T/Brhan
Complainant public Prosecutor
Accused1. Minwyelat Atnafu Abitew
2.Abebaw Desta Alemu
3.Worku Megra Bedada
4. Abebaw Gelaye Beza
5. Asnake Jembere Mitiku
6. Abraham G.Kirstos G.Medhin
The case is initiated by the application dated July 20, 2001 and supported by affidavit. The applications request the restraining of the properties of the accused and the appointment of Receiver in accordance with Article 7(8) of the Federal Ethics and Anti-Corruption commission Establishment Proclamation No. 235/2001 and Articles 3,5, and 6 of the anti corruption special Procedure and Rules of Evidence Proclamation NO.236/2001.
The application forwarded by the Investigator pronounce as follows:
The first defendant Minwyaelet Atnafu, the owner of Mina Trading has acquired illicit loan amounts to 143,230,871 in the name of Mina Trading Pvt. Ltd. Co. He has obtained the loan by presenting overstated pro forma invoice to Commercial Bank of Ethiopia, Anwar Mosque Branch, by presenting insufficient guaranty, and by presenting false documents which show the payment of 30% which should have been paid to AMCE. Furthermore, he has issued C.P.O from various banks and purchased sugar, by pledging the sugar he has taken loan from different banks. In addition to this, while working as the owner of Mina Trading and chairman of the Board of star Business Group, he has taken Birr 105 Million from Commercial Bank of Ethiopia Anwar Mosque Branch. In the absence of adequate fund, pretending as if he has fund and conspiring with bank officials, he has taken C.P.O from C.B.C Anwar Branch and purchased large amount of sugar from Ethiopian Sugar Industry Agency Share Company.
Second defendant, Abebaw Desta while working as the Manager and owner of Tiss Abay Trading has taken Birr 112,643,421 loan in the name of Tiss Abay Trading by presenting over stated pro forma invoice to CBE Anwar Branch and without sufficient guarantee. Likewise, he has taken loan improperly from Commercial Bank of Ethiopia by presenting false document without paying 30% that he should have paid to AMCE. He has taken loan from various banks by acquiring C.P.O without having money in the bank for the purchase sugar and pledged the sugar for the loan.
3rd defendant, while working as General Manager and share holder of Ethiopia Investment, he purchased companies known as ETAMO and LATCO which they have bank loan. During negotiation to buy the companies for Birr 182 million, first he requested that he does not accept spare parts more than one-year life span, receivables, goods value of Birr 12 million taken from Assab and goods sold during the process and requested the reduction of the price. He presented his request while he was negotiating with the committee established by the Bank and signed a contract illegally to buy it for Birr 113 million. Later on during delivery, pretending that reduction is made in accordance with the contract, he received property value of Birr 93 million. This is in violation of the provisions of the contract and reduced the price unlawfully. Moreover, he has taken 90 million Birr loan for purchase of vehicles for Ethiopia Investment Group out of the credit policy and guidelines of the Bank.
4th defendant, Abebaw Gelaye while working as the General Manager of Tana Transport have taken loan amounts to 35,888,240 in violation of law and guideline and without providing sufficient guaranty. He has taken the loan in addition to the large amount of loan given to the company.
5th defendant, Asnake Jembere, while he was working as General Manager and owner of AJEMA Pvt. Ltd. Co. has taken loan from commercial Bank of Ethiopia Anwar Branch Birr 20,230,921. He has taken this loan by submitting over stated pro forma Invoice conspiring with the officials of the Anwar branch while the Management committee of the Main Commercial Bank (CMCC) has ratified loan for the purchase of 10 trucks only. He bought spare parts and trucks and over valued the property for guaranty and not providing legally recognized title deed.
6th defendant Abraham G. Kirstos while working as the General Manager and owner of ABMAR Pvt. Ltd. co. has taken Birr 16,699,246 loan from commercial Bank of Ethiopia. He has taken this loan by submitting overstated pro forma Invoice to get money for purchase 19 trucks and without paying his contribution and overvalued the property to be mortgaged and did not provided title deed.
The report of the inspection prepared concerning contract of loan and utilization of C.P.O shows that unlawful acts are committed. The investigator alleged that the investigation is complicated and extensive so the process is not finalized. The Investigator further alleged that the suspects are attempting to take away and dispose the property, acquired by the bank loan, via their representative. He submitted list of properties to the court. The investigator appealed for the restraining order of their property and their bank account and appointment of Receiver in accordance with article 12-15 of proclamation No 236/2001 so as the public properly not to be wasted and utilized by the suspects.
The investigator has submitted a list of bank account numbers, vehicles and shares attached with its application. The court has considered the evidences gathered so as to understand the stage where the investigation reached and the creditability of the investigation. The court observed the following documents;
Concerning the 1st defendant a Memorandum of Association, which shows the formation of Mina Trading Pvt. LTD. Co whose capital is 500,000 by the defendant and Wro. Lackech Mengste. Contracts, regarding the loan taken by Mina Trading from commercial Bank of Ethiopia. Forms filled by Minwyelet Atnafu for different kinds of loans from commercial Bank of Ethiopia. Letter written by Menweyelet requiring loan from CBE. Letter written by Ethio-Automotive and General Trading Pvt. Ltd. Co. to CBE stating that has received 25% advance payment of sales of vehicles.
Ato Minweyelet Atnafu has started credit relationship with C.B.E January 25, 1993. He has established Mina Trading company July 1995. The suspect has taken Birr 2 million-overdraft loan and Birr 2 million term loan totally Birr 4 million initially.
He took additional loan within two months as of the day he took two million over draft loan improved to be 5 million and the total amount of loan raised to seven million. On February 16/1995 the amount of over draft raised to 18 million. For the purpose of increasing the amount of loan, a house to be mortgage previously valued Birr 4,022,500 by the engineers of the bank, later on valued Birr 14,819,900 by an organization known as ADB. The organization valued the property for a project, which have different objective, not for bank guarantee. The company has taken Birr 5,343,750 for purchase of six SCANIA Trucks with in two months as of its establishment. The company has got Birr 5 million over draft facility the value property mortgaged for this loan is Birr 2.5 million. This property was given as additional surety for the loan given for purchase of trucks. And later this guaranty cancelled and provided as guarantee for the above-mentioned loan. The suspect has the facility to overdraw since the time he has started getting the regular loan. The suspect was using the over drawal facility without sufficient guarantee and timely renewal without grantee and with no control as to utilization and payment. When the loan for purchase of vehicles were released the document deposited were pro forma Invoice, it should have been sales invoice. Other loans were given to suspect not in line with the bank regulation.
The Memorandum of Association of the Star Business Group indicate that Minwyelet Atnafu, Mina Trading Asnake Jembere, AJEMA Ethiopia General Trading, Abebaw Desta, Tiss Abay Pvt. Ltd. Co, Tedila Yizengaw and Worku Megra with capital of Birr 4,200,000 on April 4, 1997. The inspection report prepared with regard to Star Business Group explained that the company was established on 3/4/97 within the same year, authorized to get Birr 5 million overdraft and Birr10 million merchandize loan without making sufficient study. The surety provided for this loan was personal vehicle, share certificate and merchandize. This violates the order written on 17/12/98 by the Acting president which states; loan should not be given on personal guarantee. The guarantors are themselves loaners and seeking loan. In a situation where the amount of loan was authorized to be raised from Birr 5 million to 10 million Birr, the surety had to be strengthen by fixed assets. Conversely, the guarantee provided for the lesser amount loan was cancelled. It was not correct also to take share certificate as surety where there is no system of registration of shares in place. It was also improper taking surety of the vehicles as and not to reduce deprecation of the trucks annually. It is improper to allow over drawal with out certifying the utilization of the previous loan.
The three C.P.O of Tiss Abay and the three C.P.O of Mina Trading taken as sample and examined show that they are prepared where the companies do not have sufficient fund in their account.
The reports states that, Ato Ababaw Desta established Tiss Abay Pvt. Ltd. Co. With Wro. Tigist Wondifraw with Birr 5,000,000 capital on February 22, 1996. When he started business, he initially secured Birr 300,000 loan from the Bank. Within few months, the amount of loan was raised to Birr 5,000,000. Moreover, within the next few months the amount of loan hiked to 8,000,000. The loans were given with Proforma Invoice instead of Sales Invoice where the amount of loan increased, additional guarantee was not given while the previous loan was still due, additional loans were released hastily.
The Memorandum of Association shows that Mina Trading and Tiss Abay Pvt. Ltd. Companies established Tana Transport Pvt. Ltd. Co. with one million Birr capital.
The inspection report explains as follows. Tana Transport was authorized to take loan amount of Birr 35,388,240 within two years of its establishment. The credit Management Committee on its meeting authorized that Tana Transport to buy 40 vehicles out of 300 Trucks. The report explains that the Bank authorized Tiss Abay Pvt. Ltd. Company to purchase 46 vehicles and Mina Trading to purchase 51 vehicles. Tana transport manages all this Vehicles. Knowing that, Tana Transport manages all the above vehicles and have experience of a short time in transport sector. This was authorized without submitting Sales Invoice, instead only by presenting proforma, whereas, those with long time experience were authorized to purchase few vehicles. Other enterprises with long time experience were totally denied to purchase vehicles. It is indicated that Tana Transport requested Birr 508,395,840 to Birr 56, 848,000 loan by a letter dated September 16, 1998 by presenting invoices collected from Orbis Company, Equatorial business Group, Ethio- Automotive and AMCE. The Proforma Invoices prepared by, AMCE were also attached. It is attached with the inspection report the document that Tana Transport has taken Birr 16,002 778 loan from Commercial Bank of Ethiopia.
The business license shows that Ato Asenake Jembere managed AJEMA. Its capital is Birr 8,200,000. The inspection report shows that where AJEMA is a very short time customer of the Bank, on 20/8/96 authorized Birr 8 million over draft facility. It secured this facility within 48 days, from that of the day he started relationship with the Bank. It has got the facility without audited accounts and the properties provided for security do not have legally acceptable title deed and not valued by the employees of the Bank. The documents that AJEMA taken loans from the Bank are attached with the inspection report.
Ato Abraham G. Kristos and Wro Marta H/ Mariam established ABMAR International Trading Pvt. Ltd. Co. She transferred her shares and left the company. Ato Daniel G/Kristos buying 25% of the shares have become member of the company. The documents show that the loan taken by ABMAR International Trading from CBE are submitted. The inspection report shows that the company secured Birr 1,200,00 loan account and 2,000,000 term loan without presenting audited accounts of the company. Furthermore, the inspection report shows that the company has presented financial guarantee bond from an Insurance Company, which is not acceptable by the bank, to take additional loan. The company while it secured Birr 3,000,000 loan without presenting audited book of accounts, was declined by the committee. He overdrew above 25% of the over draft facility without authorization. Unapproved loans were also given to the company.
The evidences gathered against the suspects shows, 1) Minwyelet Atnafu, 2) Ababaw Desta, 3) Worku Megra, 4) Ababaw Gelaye, 5) Asnake Jemeber, and 6) Abraham G/krostos have taken loans in the name of the companies, established by them jointly and severally in violation of the guidelines and procedures of the bank. They have taken the loans within short period of their establishment. Moreover, they have taken loans by presenting financial bonds and share certificates as securely which are not acceptable by the bank, by valuing the collateral by other parties rather than by employees of the Bank. They were pledging collaterals to one loan already mortgaged to a previous loan. When they request additional loan, the bank was authorizing the loan without hesitation. This indicates that the suspects amassed wealth by creating illegal relationship with the bank officials.
Therefore,
1.The vehicles registered in the name of Star Business Group were their plate, chassis and engine number is listed and submitted by Federal Criminal Investigation;
2.The vehicles registered in the name of Tana Transport where their plate, Chases and engine number is listed and submitted by federal Criminal Investigation Department;
3.The vehicles registered in the name of Automotive Manufacturing and owned by Ethio-Investment Group where their plate, chassis and engine number are listed and submitted by Criminal Investigation;
4.The vehicles registered in the name of AJAMA Ethiopia General Trading and Industry Pvt. Ltd. Co. where their plate, chassis and engine submitted by Federal Criminal Investigation Department;
5.The vehicles registered in the name of ABMAR International Trading Pvt. Ltd. Co. where their plate, chassis and engine submitted by Federal Criminal Investigation Department;
6.The vehicles registered in the name of Tiss Abay Pvt. Ltd. Co. where their plate, chassis and engine submitted by Federal Criminal Investigation Department;
7.The vehicles registered in the name of Mina trading Pvt. Ltd. Co. where their plate, chassis and engine submitted by Federal Criminal Investigation Department
8.The shares of Abysinnia Bank owned by Ato Abebaw Desta, Ato Minwyelete Atnafu, Ato Worku Megra, Star Business Group Ethio-Investment Group, Mina Trading, AJEMA Ethiopia Trading, Tana transport Pvt. Ltd. co. and Tiss Abay and the benefits and interests that can be obtained from these shares
9.The shares of Nib International Bank and all the benefits that can be obtained from these shares
10.The shares of United Bank owned by ABMAR International Pvt. Ltd. co. and all the benefits that can be obtained from these shares.
11.The bank accounts their numbers stated by Federal Criminal Investigation Department of Star Business Group in Adama, Jimma and Mugad Commercial Bank, Awash Bank, Merkato Branch, Dashin Bank, Tana Branch, Wegagen Bank Bahr-dar, Mekele and Shashimiene Branches and Commercial Bank Gonder and Shashimene Branch as the account numbers are stated by Federal Crime Investigation Department.
12. Bank account of Tiss Abay Pvt. Ltd. in Wegagen Bank Merkato, its number is stated by the Federal Crime Investigation Department.
13.The Bank accounts of ABMAR International in Dashen Bank Dessie and Gola Branches their number is stated by the Federal Crime Investigation Department
14.The Bank accounts of AJAMA Pvt. Ltd. Co. in commercial Bank, Gola and Anwar branches their number is stated by Federal crime Investigation Department.
All the above stated properties shall not be sold or disposed or exchanged or transferred in whatsoever manner; the Bank accounts are to be freezed and restrained.
It is ordered that a committee be established composed of one representative each from Commercial Bank of Ethiopia, Ethiopian Chamber of Commerce, Ethiopian Investment Authority, Ministry of Justice and Ministry of Labor and Social Affairs.
Those offices ordered to send their representatives shall notify their respective representative to the court up to _____________________and they shall make their representatives to appear before the court.
The order shall be passed to the Banks mentioned above, Road Transport Authority and to those offices ordered to represent Receivers. Be the order passed to all concerned.
Those offices that are ordered send representatives shall certify they have good etiquette, adequate experience in their profession and who worked as head of department or equivalent post. Let the order be given to the suspects.
Signature of Judges'
Girma Tilahun
Medhin kiros
Elias T.Brhan
APPENDIX 3.3THE RESTRAINING ORDER GIVEN AGAINST ATO HAILU LEGESSE ET AL, BY THE FEDERAL HIGH COURT
Federal Democratic Republic of Ethiopia
Federal High Court
Judges:Girma Tilahun
Medhin Kiros
Elias T/Brhan
Complainant: Public Prosecutor
Suspect 1. Hailu Legesse
2. Mulugeta T/Medhin
3. Belete Alemayehu
4. Brhanu Jijo
5. Demmelash Arega
6. Brhane Ghiday Meshesa
7. Yeshihareg Zewde Lemma
8. Eskender Ysoeph T/Mariam
The case is presented before the court on account of affidavit submitted, in accordance with Article 3-5 of Proclamation No. 236/2001, by the Investigation Coordination Section of the Federal Criminal Investigation Department, requesting restraining order on the properties owned by the 6th, 7th and 8th suspects. The Section also requested the appointment of Receiver. The Section suspects that the properties of the aforementioned suspects are acquired through corrupt practices.
The application submitted by the Investigator alleges that:
The 6th and 7th suspects, Birhane Ghiday and Yeshahareg Zewde respectively, in conspiracy with Hailu Legesse and Mulugeta G/Medihin, officials of the Commercial Bank of Ethiopia, have secured loans from the bank amounting to Birr 100 million and Birr 220 million respectively. These loans have been secured by the suspects in violation of the loan (credit) policy of the CBE, improperly, and not with sufficient security and lacking legally recognized title deeds on the mortgaged property. Likewise, the above mentioned suspects conspiring with the officials of the Metehara and Wonji Sugar Factory and Ethiopian Sugar Industries Agency Share Company, have procured large amount of sugar in violation of auction rules and directives. As a result, they have caused a serious shortage of sugar in the market. This inflicted injury in the public and government interest.
The investigator explained that the 8th suspect, Eskinder Yoseph, conspiring with the officials of the Commercial Bank of Ethiopia and without furnishing sufficient mortgage, and without a legally ascertained title deed, have taken loan amounts to Birr 8 million. By this act he inflicted harm on the interest of the bank, the public and the government. The Investigator submitted a list of Bank account numbers and vehicles to be restrained which he regarded as property acquired by the commission of corruption offence.
The inspection report demonstrates as follows. Abeba Ghiday Pvt. Ltd. company has loan amounts to 85,431.79 from CBE and other banks. The guarantee for this loan is 80% of the loan. The guarantee is Financial Guarantee Bond and vehicles. This is not sufficient guarantee, it is tantamount to not furnishing any surety. Bazin Pvt. Ltd. company is established on December 25, 1997 and its general manager is Ato Brhane Ghiday. The objective of the company comprises agriculture, industry, construction, production and sale of spare parts and commission Agency. The company's over draft facilities were repeatedly renewed and extended, without taking into account its experience and performance, which should have been considered. Besides, the value of the house mortgaged was decreased from time to time to the extent that it can not cover the overdraft. Vehicles were mortgaged for overdraft knowingly that vehicles were not to be mortgaged for such loan. The credit analyst commented that Bazen does not make any encouraging progress in utilizing the loan for the company purpose, and suggested non-renewal of the Birr 10.5 million overdraft loan being used by the company. Abeba Ghiday and Bazin Private Limited Company have established Abeba Transport Pvt. Company. while this newly established company requested loan the major properties considered as source of income were the 59 vehicles purchased by the loan taken by Abeba Ghiday Pvt. Ltd. Co. from the bank. Then the use of property of one company for getting loan to another company is inappropriate. In the event that a 20 million Birr loan is authorized to Abeba Ghiday Pvt. Ltd. Co. from CBE, the value of the property mortgaged was 16,592,917.40. This amount does not cover the loan. Notice was not given requesting payment of the unpaid amount 502,158,21 of the 6.4 million loans given to Abeba Ghiday Pvt. Ltd. Co. for purchase of vechiles. The inspection report states that Birr 3 million was overdrawn by Abebe Ghiday Pvt. Ltd. company in addition to the regular overdraft facility.
The inspection report by citing the annexed documents explain that, the value of the mortgaged propriety was 38% of the 13million Birr loan provided to Bazin Pvt. Ltd. Co. Action was not taken after expiry with regard to the overdraft supply ended on April 4, 2001. Birr 10 million overdraft facility is authorized to Abeba Transport within two years of its formation and without having sufficient experience. Furthermore, the authorization violates the guideline issued by risk management, accepting insurance guarantee bond as a guarantee. In addition to this, one of the founders of the company have debt due and unpaid amounts to 3,867,500.
The report prepared with respect to Yegeta Trading Pvt. Ltd. Company explains that, Yegeta Trading has been established in February 1993, the manager of this company is Wrt. Yeshareg Zewde. This company has taken Birr 220,093,809 loan in the years from 1986 to 1993. Wrt. Yeshareg had 3 million personal loan from the bank. The capital of the company is Birr 200,000, nevertheless it has taken Birr 130,693,750 loan facility. The company does not have profit and loss statement. When the company got merchandize loan from National Bank for purchase of 174,000.000 quintals sugar, it can not be found a document which can show the payment of 30% of the price of sugar or Birr 26,935,000 to Metehara Sugar Factory. Moreover, it is found to be confusing that the price of the 174,000 quintal sugar and the 70% (Birr 89,784,000) authorized loan are equal. The bank did not confirm that the company has paid 30% of the price. This non-confirmation of payment of the 30% of the price that should be paid in advance violates bank regulation. The company has got 62,848,000 loan without submitting profit and loss statement with the understanding that its capital is not more than 5 million. There is no document showing that the so-called purchased 174,000 quintal sugar was pledged and under control of the bank. The deviation Birr 3,000,000 personal loan of Wrt. Yeshareg Zewde credited as the loan of Yegeta Trading make the company responsible for the unlawful act. Where Yegeta Trading has purchased Addis Ababa Flour Mill owned by Aleka Welde Haimanot Sequar, for 42,500,100 Birr, the 25% of the price should have been paid from the company's money or property. Nonetheless, it was paid from the overdraft taken from CBE, Finine Branch and credited to Aleka Teklehaimanot credit account in Telkehaimanot Branch.
The inspection report conducted on the situation of loan given by commercial Bank of Ethiopia Bole Branch explain as follows; the loan given to Meskel Flower Pvt. Ltd. Co. was above Birr 8.2 million, but the value of property mortgaged for this loan was only Birr 1.8 million. Due to less value of the guarantee, it is considered that the loan is given without guarantee. As the company's activity is in horticulture incase of market problems or transport shortage, the surety would be questionable and the payment doubtful.
The evidences presented by the Investigator demonstrate that 1) Abeba Ghiday Pvt. Ltd. Co. and Bazen Pvt. Ltd. Co. 2) Yegeta Trading Pvt. Ltd. Co.3) Meskel Flower Pvt. Ltd. Co. have taken large amount of loan. The loans were taken through different credit lines without submitting certificate regarding performance of the campanies, and guarantee; and they have taken loan before they settle previous loans. Furthermore, the Bank was authorizing loan to this companies in the absence of objective evaluation of the companies and in transgression of regulations and guidelines that jeopardize the interest of the public. It is found indispensable to restrain the properties of the company acquired in such course of action.
Therefore,
1.The vehicles registered in the name of Abeba Ghiday Pvt. Ltd. Co. and their plate, chassis and engine number listed by Federal Criminal Investigation Department;
2.The vehicles registered in the name of Yegeta Trading Pvt. Ltd. Co. and their plate, chassis and engine number listed by Federal Criminal Investigation Department;
3.The vehicles registered in the name of Meskel Flower and their plate, chassis and engine number listed by the criminal Investigation Department;
4.The Bank accounts of Ababa Ghiday Pvt. Ltd. co. in Awash International Bank Dilla Branch, Commercial Bank of Ethiopia, Bole Branch, CBE, Awassa Branch as the account number stated by the Criminal Investigation Department;
5.Bank accounts in the name of Brhane Ghiday in C.B.E, Bole and Temnja Yaz Branches as their numbers stated by the Criminal Investigation Department;
6. Bank accounts of Yegeta Trading Co. in Constriction and Business Bank main Branch, their number is stated by the Criminal Investigation Department;
7.Bank account in the name of Yesharg Zewde in Dashin bank and in Commercial Bank of Ethiopia, Air Tena and Finfine Branches and their numbers stated by the Criminal Investigation Department.
8. Bank account of Meskel Flower Pvt. Ltd. Co in Commercial Bank of Ethiopia Bole Branch and Abyssina Bank, Bole Branch, their numbers are stated by the Criminal Investigation Department;
Shall not be sold or disposed of or exchanged and transferred to third party in whatsoever manner, and the bank accounts shall be blocked. A copy of this order shall be passed to all concerned.
It is also found essential to appoint receiver so as to preserve the properties and bank accounts, in accordance with Article 12 of the proclamation Number 236/2001. Therefore, it is ordered that a committee to be established composed of one representatives from commercial Bank of Ethiopia, Ethiopian chamber of Commerce, Ethiopia Investment Authority Ministry of Justice, Ministry of Labour and Social Affaires and act as Receiver. Be the order pass to the offices.
The offices requested to send representatives has to send representative to the court of a good character, sufficient job experience in his profession and in the level of head of department or equivalent post up to August 2, 2000. Be the order transferred. Let the order be bestowed to the suspects.
Judges' signature
Girma Tilahum
Medhin Kiros
Elisa T/Brhan
N.B.The 1st, 2nd, 3rd, 4th and 5th suspects had neither bank accounts to be blocked nor properties to be restrained, although their names were included in the list.