Amidst controversies over recent GAC ‘Factual Findings’ ,into circumstances surrounding the conduct of 25million United States dollars intended to Mop-Up excess liquidity, Transparency International and the Center for Transparency and Accountability in Liberia (CENTAL), is calling on President George M. Weah to return the report and direct the GAC to proceed in keeping with his earlier mandate to conduct an “investigative audit” and to also provide an assurance regarding its findings.
CENTAL also called on the President to allowed GAC an additional three-week period to conduct a forensic investigation building on preliminary information in its possession.
In a release issued in Monrovia, CENTAL further insists that President Weah takes appropriate administrative action against the Minister of Justice, Cllr. Frank M. Dean, for failing to ensure that the Presidential directive relating to an “investigative audit” was considered and adhered to when he (Mr. Dean) engaged the services of the GAC as an officer of the President.
It may be recalled, the General Auditing Commission (GAC) on Thursday, May 16, 2019, released a report titled: “Auditor-General’s Report of Factual Findings on Applying the Agreed Upon Procedures of the US$25Million Mop-Up Exercise Conducted by the Central Bank of Liberia (CBL) as mandated by the Technical Economic Management Team (TEMT)”.
The release furthermore, lauded the Government of Liberia (including the GAC) and all whose work contributed to this report, including the Presidential Investigation Team (PIT) and the United States Government through Kroll Associates, Inc./Kroll, for ensuring democracy prevail through proper management of state resources.
“Firstly, ladies and gentlemen of the Press, the “Auditor-General’s Report of Factual Findings” comes as a surprise. It can be recalled that on March 7, 2019, the public was informed that the Ministry of Justice, by directive of President George M. Weah, had requested the GAC to conduct an “investigative audit” into how the US$25million earmarked for the mopping-up of excess Liberian dollars was expended.
“According to the release than, the Presidential mandate grew out of the PIT’s report, which called for a “forensic investigation” of the entire mop-up exercise as well as the report done by Kroll. But despite this Presidential order for an “investigative audit”, the GAC proceeded to conduct an Agreed Upon Procedure (AUP) Engagement.
“Contrary to the spirit and intend of the Audit, the GAC notes that it provided “possible alternatives” to the President’s request: Forensic Audit or AUP Engagement, and that the Government of Liberia through the Minister of Justice opted for an AUP to be performed. CENTAL struggles to understand the rationale for this position, which contradicts the clear and unambiguous mandate of President Weah that the GAC conducts an “investigative audit”. CENTAL noted.
The release additionally states that the report released by the GAC cannot suffice as an “investigative audit” in light of the circumstances that gave rise to commissioning of the audit.
CENTAL observes: “This is so because the Government’s selection of an AUP, as against a Forensic Audit, so clearly limits the GAC to report on factual findings without expressing any assurance, thus shifting the said role to the Government or public to draw their own conclusions.”
” This could lead the Government or the public to misinterpret the results of the said procedure as the field of financial accounting or audit is technical and specialized. In our opinion, this was not the result intended by the PIT and Kroll. We believe that the PIT’s recommendation of a “forensic investigation”, which formed the basis for President Weah mandating an “investigative audit”, was based on the fact that preliminary investigations.”
CENTAL press release narrates that establishing a probable cause for a forensic investigation that could uncover corruption, conflict of interest, and other types of fraud, and that such discovery could lead to prosecution of suspected corrupt officials under controlling Liberian laws, must be taken into consideration.
“This, we believe, is why the PIT report did not hold any official accountable for the mop-up exercise, but did so in the missing 16 Billion scandal. Specifically, it named Messrs. Charles E. Sirleaf, Milton Weeks, Richard H. Walker, Dorbor M. Hagba, Joseph Dennis, and the Swedish company, Crane AB as being in violation of Liberian laws including the Penal Law: Section 15.81 (Misuse of public money, property, or records) of the Penal Law, Section 15.82 (Theft and/or illegal disbursement and expenditure of public money), Section 10.4 (Criminal Conspiracy); Section 10.2 (Criminal Facilitation), Section 12.34 (Tampering with Public Records).
“Therefore, it is our considered opinion that the “forensic investigation” was recommended by the PIT in order that culpable individuals are identified, similarly as in the case of Mr. Charles Sirleaf and others. Kroll had already shed some light when it indicated that “the approach taken by the CBL to implement the USD Mop-Up Exercise, whereby small teams of bank personnel directly purchased LRD banknotes from local businesses and foreign exchange bureaus in exchange for USD notes, created an enhanced level of risk with respect to: i)potential misappropriation of banknotes, ii) potential opportunities for money laundering and iii) potential execution of transactions with illegal businesses… [and that] consequently, there is a risk that significant funds were unaccounted for by the CBL.” CENTAL stated.
CENTAL is at the same time calling on GAC to continued from where the PIT and Kroll stopped.
“In other words, the GAC should have gone beyond the limits imposed on the PIT and Kroll investigations by time, scope, and financial resources. Yet, the Government of Liberia, through the Minister of Justice, settled for a procedure that does not mirror that which was prescribed by the PIT and Kroll.
” We wonder why the Minister of Justice, Cllr. Frank M. Dean, who approved the PIT report (including recommendations) as Chairman of the PIT Steering Committee, would discard the recommendations in favor of a less stringent and basically procedural engagement.
“We also cannot fathom why the GAC provided an AUP as an alternative approach to the President’s directive for an “investigative audit”, being fully aware of the scope limitations of said procedure.”CENTAL contended.
CENTA said the GAC report has presented facts that have claimed attention, especially when the report states that: It states that: US$491,769.00 was purportedly sold to fifteen (15) entities, but that the said entities have denied participating in the exercise. Another US$702,680.00 was sold to twenty-seven (27) entities not registered to do business in Liberia.
On the underlying accounts and records, CENTAL stated that variance found by the report of LR$17,775,323.78 between the summary report and detailed report of the CBL, with an additional variance of US$1,466,783.00 between the summary list of beneficiaries and the detailed report per beneficiaries which amounts to Eighty-nine (89) beneficiaries with total amount of US$5,670,880.00 needs further calculation to further confirm the amounts in US$ transacted with the CBL.
“While these findings further relate the extent to which the mop-up exercise was marred by irregularities and potentially corruption, the report falls short of the specificity required for a successful prosecution of individuals that ought to be held accountable.” CENTAL emphasized.
In the recent audit report, GAC itself admits that the AUP it employed does “not constitute either an audit or a review made in accordance with International Standards of Supreme Audit Institutions (ISSAI) or International Standards on Review Engagements (ISRE).”
With that, CENTAL is questioning why did the GAC not decline to carryout the procedure, being in the position to have known that the said procedure would have been of less audit significance under the circumstances?
“We regret to note that the procedure under review amounts to a waste of the Liberian people’s precious time and money, for it essentially duplicates efforts of the PIT and Kroll and does little to inform the Liberian people of the ramifications of actions by the Technical Economic Management Team (TEMT). Rather, the GAC has shifted its statutory responsibility to the Liberian people for determination of what went wrong, who did wrong, and how things went wrong. Such was the same outcome of the PIT and Kroll reports and we do not see how the GAC report is any significantly different. ”CENTAL release concluded.