Sunday, February 25, 2018

Tracking LifeSport’s DNA

 In Trinidad and Tobago fragmented government ministries, pliable special purpose companies, and compromised technical staff make scandals like LifeSport possible. But, the oversight bodies cannot keep up with the raw banditry. The few criminal prosecutions are long and drawn out, convictions near impossible. Political resignations and dismissals are no help. The problems spread wide and sink deep. So, with Anil Roberts gone, what will we do?

On his resignation, Anil offers an insight: “Several ministers, whose ministry came under question, were never asked to resign.” Roberts had to go, but he is right about the others. LifeSport is likely replicated across the “State sector”, that nebulous government activity that swelled over time, with political neophytes and various predators as sponsors and chaperones. Special purpose companies have grown and drawn the spotlight, UDeCOTT, EMBD, and now the Sport Company of Trinidad and Tobago (SPORTT).

The Housing Development Corporation, the CEPEP Company, and more recently Caroni Green, all carry the LifeSport DNA. Without solving crookedness at the longer established WASA, TTEC, PTSC, and other state operatives, new vehicles were deployed, each with a watermark of slackness that over time cost the taxpayers dearly. Roberts says the LifeSport DNA is all over, so what’s next?

Anil Roberts’ resignation does not provide the answers, but SPORTT, the special purpose company executing projects on behalf of the Ministry of Sport, can provide some answers. Buried in the scant LifeSport audit report of July 25, 2014, the former departed SPORTT CEO suggests that he may have been “set up” to execute the $34 million “contract” with EBeam Interact Limited, something he now regrets. The auditors conclude, “it is evident that the ‘mind and management’ of this contract has always been and continues to be” the Ministry of Sport. This is rubber-stamping, but is it prevalent?

The LifeSport audit report also refers to the execution of the $34 million contract between SPORTT and EBeam in December 2012, and the later ratification in March 2013 by the SPORTT board. Who signed that December 2012 contract, on what authority, and why was it necessary for SPORTT to later ratify the contract? Did the board of SPORTT independently and objectively examine the case for sole selective tendering or did it merely rubber-stamp the Permanent Secretary’s request to the SPORTT CEO to approve the contract? The audit report’s recount of that justification appears flimsy, so it will be useful to understand SPORTT’s basis for acceptance of it. More importantly, each SPORTT director must examine the basis on which the contract was approved or ratified. 

This is critical learning for state company directors, many anxious to expedite, facilitate, and rubber-stamp. The audit report says SPORTT was initially in control of LifeSport for a five-month period, but in January 2013 the Ministry of Sport assumed full control. Notably, SPORTT continued to have a role as “payment provider” to “facilitate payment”. Unfortunately, the auditors did not examine this role and did not examine the relationship between the Ministry of Sport’s full control of LifeSport and the fiduciary responsibility of SPORTT’s board of directors for payments the special purpose company approved or just facilitated. 

The EBeam contract and the auditors’ comments on it point to the likelihood that SPORTT was a mere rubber-stamp, a prospect that requires closer examination and accountability. Directors must take note because politicians, especially resigned, dismissed, or voted-out ones, cannot shield them from personal liability. And, SPORTT handles multimillion dollar infrastructure projects at Couva and Tacarigua. Is the $34 million EBeam contract indicative of how it conducts business? A forensic examination will answer.

/The author is a lawyer and possible PNM candidate for the next general election