Ministry swindled of millions

Edmond Campbell, Senior Staff Reporter

EYEBROWS WERE raised in Gordon House yesterday after it was reported that $21 million was allegedly fleeced from the Ministry of Finance by a senior executive who has since resigned and is said to have migrated.

Visibly upset members of Parliament's Public Accounts Committee (PAC) grilled senior technocrats on the issue, demanding answers on how this could have happened at a ministry where checks and balances should have been supreme.

"One would have thought that particular and painful efforts would have been taken to ensure that the very said ministry which issues these guidelines are above board ... " committee member Dr Morais Guy lamented.

He bemoaned the lapses at the ministry, which have led to several cases of multimillion-dollar fraud over the last four years.

The irregularities in the latest case were detected last year by the Accounts Department at the ministry and the matter reported to the auditor general and the police.

Brenton Burrell, a senior executive at the Auditor General's Department, requested an update on the issue at the PAC meeting yesterday.

No breakthrough

Acting principal finance officer at the ministry, Granville Green, told the committee yesterday that although the Fraud Squad started its investigations into the matter late last year, it has not yet made a breakthrough.

He said the Fraud Squad interviewed at least 12 members of staff, but since then, there has been no response from the police.

Committee member Ronald Thwaites quizzed ministry officials as to whether there were internal auditors at the ministry. However, no answer was forthcoming.

Under pressure from the committee, Green explained that a senior executive was appointed to head a unit at the ministry.

"... This person was in charge of this unit of about three persons. She was the coordinator of the MOU (memorandum of understanding) Secretariat and was the liaison between the secretariat, the unions, the various training institutions, so she basically could authorise and approve documentation and expenditure on a daily basis," he said.

Green stressed that when documents were submitted to the Accounts Department, they were deemed legitimate. However, he pointed out that "this person was allegedly generating documents, invoices" for catering services and training.

Fake invoices

The ministry official said fictitious invoices were created but, in some instances, there was collusion between the former employee and outside institutions, including a supervisor at a bank.

As secretary to the Permanent Salaries Review Board, Green said: "It is alleged that when we issued cheques to the members of the board, most of these cheques went the same route, delivered to the coordinator, cashed at the same bank, nine times out of 10, then authorised by the same supervisor at the bank."

A former politician who was contracted to the Ministry of Finance was said to be a victim of the fraudulent scheme, according to Green. He said travelling cheques which should have been issued to him were allegedly encashed.

Financial Secretary Dr Wesley Hughes said the affected person had complained to him about the unfortunate situation.

"It was a very tragic and painful exercise to go through," Hughes told the committee.

Commenting on the issue, committee chairman, Dr Omar Davies, said: "It was an unsatisfactory state of affairs."

Less than two days ago, reports emerged that a senior director at the ministry was slapped with criminal charges for fraudulently assisting someone in obtaining a waiver for a 2005 Nissan Titan pickup.

Cherry Gordon of the taxation policy unit is now facing fraud charges.

In late 2007, nearly $17 million belonging to former Matthews Lane strongman Donald 'Zekes' Phipps disappeared from a safe at the Ministry of Finance's Financial Investigations Division at its Heroes Circle offices.

The money, which was seized in a police raid, was being held as an exhibit in a case against Phipps.

edmond.campbell@gleanerjm.com