Quashing revocation of the License of Unicredit by Court of Appeal and the Lessons for Regulatory Bullying-Prof. John Gatsi

The banking and financial sectors suffered seriously due to the approach adopted by the Bank of Ghana in dealing with the banking and financial sector cleanup. Generally, it was the view of many people with understanding of the sector that the Bank of Ghana might be applying the law without recourse to other requirements of Act 930 and the 1992 Constitution that border on fairness, exhaustion of processes and appropriateness of revocation actions. It was as if the Bank of Ghana thinks the power to revoke license in section 16 of Act 930 , section 92 relating to directives and section 60(5) relating to prior approval of directors before appointment of same by Banks and Special Deposit-taking institutions relate only to show that the Bank of Ghana has power. There is a time coming and approaching very soon that using regulatory power in a manner that exclude other citizens and bully them will turn to those involved as a poison pill that they cannot swallow if the regulations are applied to them in same manner.

Application of regulatory power from a positivist jurisprudential mindset may derail stakeholder confidence and create multiple legal actions. Applying regulatory measures just because the Bank of Ghana has the regulatory power to revoke, give directives or give prior approval in a manner that does not take into consideration proper utilization of regulatory power, then the risk to regulatory management will be pronounced.

The question is in case the Bank of Ghana exercises one of the options in the the Court of Appeal's ruling in the Unicredit case by going to the Supreme Court and fail, it means the revocation is overturned with financial and other legal implications for banking?. 

The provisions in sections 16 and 60 do not expect the regulation actions regarding revocation and prior approvals to be done without comprehensive due process. What will happen to Ghanaian citizens if regulatory authorities become partisan or excessively allergic to constructive criticism? It is likely the regulations will be applied with impunity but dangerous to inclusive regulatory benefits. Take for example section 60(5) that only says the Bank of Ghana has the authority to give prior approval of nominated persons to directorship in Banks and Special deposit taking institutions. So providing section 60(5) as reasons for the decline of directorship only means the Bank of Ghana has assume the role of appointment of directors to banks which is dangerous development in the country. It will become a political motivation for politically oriented and those who think the regulator is above criticism.

The Court of Appeal's ruling is a light into a future that requires healing of masses of Ghanaians who have experienced psychological mutilation for being customers or investors or professional discussants of banking and financial sector issues. The pain of many Ghanaians as a result of the banking and financial sector cleanup needs to be addressed. The banking sector cleanup may need a forensic enquiry that will address the painful experiences of entrepreneurs, investors and customers.