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‘Millions lost’

By \\\\\ Asha Javeed asha.javeed@trinidadexpress.com

Co-ordinators with criminal backgrounds, massive fraud, millions misspent, ghost centres, ghost participants and improper procurement were some of the findings of the Central Audit Committee’s report into the Ministry of Sport’s LifeSport programme.

The programme, conceived by Sport Minister Anil Roberts designed to rehabilitate criminals has spawned massive corruption.

About $40 million was spent for vocation training but no work was done. One company, E-Beam Interact Ltd, owned by Adolphus Daniell, was paid $34 million for no work, while many others submitted padded invoices to the Ministry of Sport.

Millions spent on computers  and laptops for the programme were stolen from the centres or unaccounted for.

Further, the Ministry of Sport increased the number of LifeSport centres without Cabinet’s approval. Cabinet had approved 33 centres but ten more were added by the ministry and several could not be located during the audit.

The 53-page report, which was focused on the payment system of the programme, was tabled in Parliament yesterday and sent to the Director of Public Prosecutions (DPP), the Commissioner of Police, the Integrity Commission and head of the Public Service for appropriate action.

The auditors observed that initial payments in the programme were  done in cash which meant there could be little verification or control over the payments.

“From the review it is clear that the LS (LifeSport) Programme has a number of irregularities judging from the widespread absenteeism, absence of proper procurement practices, overpayment for goods and services and possible criminal activities ranging from fraud (where money has been invoiced and paid but goods and services not supplied) to theft and possible breaches of the Proceeds of Crime Act. In addition, statements from members of the Police Service with whom the auditors interacted during the audit of the programme suggest there may be criminal elements in positions of supervision and coordination within the programme,” the report noted. 

Following are highlights of the  audit which was initiated by Prime Minister Kamla Persad-Bissessar on May 24 following a series of exclusive stories in the Express on how the programme was financing criminals: 

Vocational Training (Trade Component) Payments were made for services not received and these may constitute a breach of the Proceeds of Crime Act.

1. An amount totalling $5,619,250. was paid to Allsnorth General Contractors, Re Construction and Repairs Ltd, Scobex Tech Ltd, Kadeem & Associates Ltd and McKain Enterprises Ltd for the provision of vocational training. Theodore Charles, Ronnell Barclay and Cyril Berkeley could not provide any details on the tender and award processes. Centres visited revealed the Vocational Training Component was never implemented. All the companies listed above submitted invoices which did not have VAT registration numbers displayed. Based on the value of the said invoices, they all exceeded the legal VAT threshold and it is mandatory that they are registered with the Board of Inland Revenue. This constitutes a violation of the Proceeds of Crime Act.

2. Central Audit was informed that E-Beam was solely selected mainly because of the company’s president/CEO, Adolphus Daniell’s track record as an educator with respect to individuals who have struggled academically. The contract amount was agreed at TT $34,000,000 with a planned commencement date of December 6, 2012 and a projected completion date of September 30, 2014. To date that component of the programme has not started. However, the payment of $34,000,000 was made to EBeam.

 

“The current position of this contract requires expert legal advice which Central Audit cannot provide. It is therefore recommended that SporTT await the advice of the senior counsel, which it has sought, and which hopefully would assist in determining a way forward,” it noted.

“Central Audit also recommends that a formal request be sent to the Inland Revenue Division (IRD) to examine whether or not E-Beam Interact Ltd filed a Corporation Tax Return for the year 2013. The objective is for IRD to verify that the company declared the seventeen million dollars (TT$17,000,000) it received in 2013 as well as to keep in mind the 2014 Corporation Tax Return due in 2015 for the declaration of the other seventeen million dollars received in 2014,” the auditors noted.

 

  Centres

“The Ministry of Sport increased the number of LifeSport Centres (LS) without Cabinet’s approval. Several of these centres could not be located.”

1. “It was discovered that some of the recently-introduced centres do not have a fixed or proper place to operate. For example, Central Audit discovered that the Four Roads and Cocorite community centres, out of which the Four Roads and Cocorite LS centres were supposed to be operating, have never been used.”

2. “Similarly, Central Audit was unable to locate Malabar Train Line 1 and 2, Beetham Gardens and Covigne Road LS centres when a visit was made to the listed addresses. It was also discovered that some of the older centres are still operating out of churches, panyards and savannahs.”

 

Coordinators 

“The coordinators seem to have criminal records which made them unsuitable as role models for the participants.”

They were paid $30,000 a month.

1. During the field visits, personnel from the police service who provided protective escort to officers of the Central Audit Committee expressed concern about certain individuals who were contracted as coordinators for specific centres. 

These officers have alleged that a few such individuals in the East/West corridor are currently under police surveillance for illegal activities in their relevant areas.

2. The police officers were also very apprehensive whether such individuals can reform the participants under their watch when they themselves may still be involved in criminal behaviour. One of the officers strongly believed that the Cocorite, Four Roads and Covigne Road centres may have some sort of allegiance with the Carapo centre. Central Audit could not verify whether any such allegiance exists.

“Based on the history of some coordinators, the decision to give such persons the power to manage, control and authorise payments without proper supervision was ill-conceived. Based on circumstantial evidence it appears that some coordinators are in collusion with certain providers of goods and services, some participants and maybe even officers from the LS Programme,” was the auditor’s concern.

 

Coaches

“The number of coaches being paid is greater than the actual number of coaches who are actually working on the programme which suggest a real possibility of fraud.”

1. Discrepancies were discovered with respect to the number of coaches performing the duties and the number of coaches actually being paid. According to the accounting records the full complement of coaches has consistently been paid but what was discovered during the site visits was that several coaches were not actually performing the duties for which they were hired.


Participants

“The review of attendance reveals several irregularities. There is a high possibility that the total number of participants being paid was significantly higher than the number of participants who actually attended the programme.”

The number of participants increased from 1,980 at 33 centres to 2,250 without Cabinet’s approval.

 

1. Examination of the payment documents for June revealed several instances where stipends were made to participants without proper approvals and supporting documentation.

2.  Additionally, during the visit to centres, it was noted that the number of participants present was less than the number of participants who signed the daily attendance register and even less than the number of participants submitted for the monthly stipend. In many instances participants were signing on behalf of other participants.

 

Catering Services

“A number of irregularities were observed involving catering services.”

Daily meals were provided to participants at a cost $75- $25 for breakfast and $40 for lunch.

1. During the visits to various LS centres it was discovered that in most cases the amount of meals catered far exceeded the amount of the average daily attendance of participants. In one instance Central Audit actually observed the delivery of the lunches. 

The caterer delivered the lunches without beverages in small lunch boxes, which normally retail for less than thirty dollars ($30.00) each in most fast food shops. Checks however revealed the caterer claimed and was paid for the full sixty-five breakfasts and sixty-five lunches for nineteen days in the month of June 2014. What was more instructive was that the invoices submitted by the majority of the caterers were almost always equal to the full participants’ enrolment, notwithstanding the level of absenteeism observed in the programme.

2. It was discovered that this was encouraged by both the past and current directors of the LS Programme, Henry Charles and Cornelius Price respectively. They both insisted the caterers must be paid for the number of meals as per the contracts.


Janitorial Services

“Payment of the janitorial services appeared exorbitant, questionable and fraudulent in many cases.”

Janatorial services cost the programme $1 million a month.

1. Examination of invoices revealed that the scope of works submitted by these contractors were the same regardless of the dissimilarity of the individual state of affairs of the Centres. Examination of the items claimed for works performed appeared to be inflated and duplicated.

2. In addition, examination of the above revealed an invoice related to cleaning services at Carapo Community Centre in the amount of $37,900. It should be noted that these participants are housed under tents, and as such, the provision of cleaning services needs further investigation as these cost may be exorbitant and questionable.

3. A site visit on June 11, 2014 to Point Fortin revealed that the programme has been operating from the Fanny Village Pavilion since August 2013 (9 months) which is located next to the community centre.  Despite this, substantial payments were made to Richie’s General Contractors Ltd for janitorial services in the amount of $51,750 on two occasions. Taking into account the location (a pavilion) it is questionable as to the relevance of the janitorial payments.


Maintenance of 

Recreation Grounds

Similar to janitorial services, several instances of exorbitant,questionable, and possible fraudulent payments were observed.

The contractors were recommended by the Ministry of Sport and were often duplicated.

1. Commencing January 2014 contractors were awarded nine (9) month contracts for field maintenance works at a cost of $68,000 per month VAT exclusive. The scope of works and costs relating to the maintenance of recreation grounds appears to be excessive and may have been overstated. These concerns were confirmed when the various centres were visited; major discrepancies were observed with respect to invoices submitted by these contractors.

2.  The review of payments for maintenance works revealed that even though the award of contracts was based on the lowest price submitted several contractors won awards even though their bids were not the lowest.

3. Several invoices from Reno were signed by Jolene Legere and affixed with the Company’s stamp. Central Audit noted that Jolene Legere was also a contracted caterer attached to the Enterprise LS Centre. The signature on the Reno invoice and the signature from a catering invoice submitted by Jolene Legere appeared identical. This defeated the stated purpose of encouraging many small entrepreneurs to be involved in the programme.

4. Central Audit also noted numerous invoices submitted by Reno and SOS (West Indies) Ltd (SOS) dated February 28, 2013 and March 31, 2013 which shared similar invoice numbers even though the periods being invoiced, the grounds being maintained and amounts charged were all different. Further, both companies shared a common director, Mr James Dedier, the same fax number and had a similar pattern of invoice numbering.

5. Discussions with LS Programme coordinators/supervisors during the various site visits revealed that recreation grounds used by the centres are maintained by the respective Borough/Regional Corporation. However, invoices/payments were seen from contractors for maintenance works at the said grounds.

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