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Financial Crime Case Studies in Gabon: A Story of Unconventional Business Dealings
In January 2021, Gregory Rockson, CEO of mPharma, walked into a boardroom meeting in Accra, Ghana’s capital, to pitch an unconventional plan. The company, which had grown exponentially through clever use of technology and working capital, was considering expanding its business into the public sector.
The Unconventional Plan
Rockson proposed managing Gabon’s National Pharmaceutical Office (OPN), a struggling state medicines distribution agency that the country’s $1.8 billion sovereign wealth fund had decided to refocus on social infrastructure. The contract offered scope for future ownership and a model with applicability to many other countries.
Challenges and Risks
However, the deal came with significant risks, including resourcing concerns, bureaucratic hurdles, and cash flow constraints. Rockson and his team were aware that similar attempts in other African countries had failed due to corruption, opacity, and dysfunctional politics within ministries.
Factors That Led to the Decision
- A desire to shake up the provision of public services and essential goods in Gabon
- Potential contract in the Democratic Republic of Congo, backed by the World Bank, which ultimately failed due to local political resistance
The Call from Akim Daouda
In 2019, Rockson received a call from Akim Daouda, then chief investment officer of Gabon’s sovereign wealth fund, who persuaded him to take a detour to Libreville, Gabon’s capital. Daouda described how persistent failures to deliver medicines on time or affordably had largely displaced the OPN by commercial pharmacies.
The Covid-19 Pandemic and mPharma’s Intervention
The Covid-19 pandemic hit in 2020, and mPharma stepped in to provide test kits and medical equipment, giving Rockson a taste of the system. He discovered that there was no IT system to benchmark performance, nor even emails for employees.
The Situation on the Ground
- Warehouses were not up to standard
- Infrastructure was really poor
- Staff were very demoralised
The Proposal and Its Terms
Later that year, Daouda was promoted to chief executive of the wealth fund and moved ahead with his plans. After taking control of OPN, he proposed a $5 million operational management contract with mPharma to cover its costs in overseeing procurement and distribution.
The Decision Ahead
- Rockson had to convince his directors to proceed
- Operating in a complex francophone country with which, as a Ghanaian, he was unfamiliar
- In an inefficient sector he had avoided because of fierce vested interests that resist reform
- Uncertainties over politics and patronage
What Would You Do?
What would you do if you were in Rockson’s situation?