Integrity Commission raises allegations of fraud in St Ann COVID cleaning contract

The Integrity Commission (IC) has referred Xavier Munroe, a former senior official at the St Ann Municipal Corporation and one of the corporation's contractors to its corruption prosecutor on allegations of fraud linked to a $47 million COVID contract that was "irregular" and "lacked integrity". 

A report on the probe done by the anti-corruption agency was tabled in the House of Representatives on Tuesday. 

It examined the contract that was awarded to Rahim's Cleaning and Trucking Limited, which is headed by Rahim Walker, in March 2020 for cleaning and sanitising works at eight locations in Ocho Rios.

At the time, Munroe was the deputy chief engineer. He is now based at the Hanover Municipal Corporation. 

Sanitisation work was done at the Urban Development Corporation's Island Village complex, Main Street in Ocho Rios, Turtle River Park, Ocean Village, Ocho Rios Market, and Fisherman Village.

But the Integrity Commission's Director of Investigation, Kevon Stephenson, said "there is evidence to suggest that value for money was not attained" and that the circumstances which led to selection and award of the contract to Rahim's Cleaning breached procurement rules.

Eyebrows were raised at a parliamentary committee in June 2020 when it was revealed that it cost more than $9 million to sanitise and clean handrails, gates, doors, gate handles, and door handles at the Ocho Rios Pier.

At the Island Village complex, cleaning involved sanitisation of handrails, gates and their handles, doors and their handles, rail guards and seating, amounting to $7.5 million.

The committee was told that a letter to verify the competency of Rahim's Cleaning and Trucking Limited came from Tracy Fakourie, regional operations manager of North Eastern Parks and Markets (NEPM) Waste Management Limited.

The agreement between the St Ann Municipal Corporation and the contracting firm was signed on March 26, 2020. However, the letter of recommendation from Fakourie was dated May 20, 2020, almost two months after the contract was signed.

The project was funded by money from the Tourism Enhancement Fund. 

Some of the key conclusions and recommendations from the IC's Director of Investigation Kevon Stephenson:

1. Circumstances which led to selection and award of contract to Rahim's Cleaning breached Section 25 (2) of the Public Procurement Act. Conclusion based on the fact that the utilisation of the single-source procurement methodology, given the contract value, required prior approval from the head of entity and no such approval was granted by the chief executive officer at the St Ann Municipal Corporation at the time of the contract award

2.  This conclusion is primarily predicated on the premise of the justification provided by Munroe, who indicated that the locations were selected on the basis of where 'people gather' and the fact that at least three of the premises were closed to the public prior to the execution of the project and the failure of the contractor to fully perform the contract based on the agreed deliverables of the contract. Additionally, and importantly, the inability on the part of the St Ann Municipal Corporation, and the contractor to clearly identify the manner in which the measurements and units were determined also impaired the determination of value for money

3. The procurement process was irregular and lacked accountability and integrity. Conclusion formed on basis of absence of formal procurement documentation and record keeping by the municipal corporation. For instance, Stephenson has seen no written communication (invitation to bid or invitation to submit a quotation) inviting the contractor to submit a bid/quotation for the procurement opportunity. There was also an absence of records documenting the officers of the corporation who were involved in the process. 

4. Stephenson accepted statements from witnesses that the sanitisers and brochures were not provided to the St Ann Municipal Corporation by the contractor as indicated by the bill of quantities for the contract

5. Apparent discrepancy between statements made by Rahim Walker and Xavier Munroe in relation to the duration of the implementation of the contract. Walker said project implemented over two and a half weeks. Munroe said over one week. The IC said based on its observation and statements collected, there is prima facie evidence to suggest that the project was implemented on the weekend subsequent to the signing of the contract on March 26, 2020. 

6. Representations by Rahim Walker during the investigations were in some instances misleading. 

7. St Ann Municipal Corporation, through its Roads and Works Department, failed to demonstrate diligence in the preparation of the bill of quantities and the general conceptualisation of the project

RECOMMENDATIONS

1. Copy of investigation report referred to Director of Corruption Prosecutions Keisha Prince for such actions as the director may deem appropriate.

2. Report referred for consideration as to whether contractor committed offence of fraud based on submission of his invoice for work purportedly done and for which the DI could not confirm.

3. Report referred for consideration as to whether contractor and Xavier Munroe committed offence of obtaining money by false pretences contrary to the Larceny Act based on payment made to the contractor for works which the DI could not confirm were executed.

5. Report referred for consideration as to whether the contractor and Xavier Munroe conspired together and/or with other persons to defraud the St Ann Municipal Corporation in relation to works allegedly executed as reflected on the contractor's invoice and which Munroe confirmed were satisfactorily done and payments made. 

6. Report referred for consideration as to whether Xaviier Munroe committed an act of corruption contrary to Sections 12 (1)b of the Corruption Prevention Act when he, in performance of his functions, failed to act with proper diligence to verify works or the reference contract, for the purpose of the contractor and or himself obtaining an illicit benefit.

7. Report referred for consideration as to whether Xavier Munroe and Rahim Walker committed perjury during the course of the judicial hearings in relation to their statements regarding the provision and distribution of approved sanitisers and brochures/posters.

8. St Ann Municipal Corporation urgently establishes a specialist procurement unit in accordance with the Public Procurement Act and its regulations

9. St Ann Municipal Corporation implements an effective and efficient record keeping and/filing system that will aid in maintaining proper financial and procurement records in accordance with the Public Procurement Act and the GoJ Public Procurement Guidelines and Procedures (2014).  

10. St Ann Municipal Corporation establishes oversight mechanisms that will facilitate greater scrutiny of the projects and programmes administered by the Roads and Works Department in an effort to ensure prudent financial management. 

Companies Office of Jamaica records indicate that Rahim's Cleaning and Trucking Limited was incorporated in August 2017 and is located at 3 Smith Street in Woodford Park. Rahim Walker and Damion Shirley are named as directors and shareholders.

- Jovan Johnson

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