TREASURY Secretary Koiari Tarata found himself at a loss yesterday to explain K1 million paid to a security firm for leaders’ security in 2001. The firm, Alert Security, owned by businessman Caspar Wollom — who was elected Moresby North-East MP in the 2002 national elections but has since been unseated in a successful court decision disputing his election — was paid K1,163,770. On top of that, the firm also received K57,422 for security provided to then Prime Minister and Treasurer Sir Mekere Morauta, his then Finance Minister Andrew Kumbakor and the secretaries for Treasury and Finance. The Deputy Secretary’s (Finance, operations) security costs was also paid for. The Public Accounts Committee found that K27,000 of that amount was “excessive’’. The committee zeroed in on the K57,422 paid in October 2001 — K27,422 more than the combined security allowances for the two ministers (K12,000 for the Prime Minister and K6000 for the Finance Minister) and the departmental heads (K6000 each) — amounting to K30,000. The Deputy Secretary was not entitled to a security allowance. The security costs being questioned by the committee were for: * PRIME Minister and Treasurer’s residence — K32,736; * MINISTER for Finance, National Planning and Rural Development — K8184; * SECRETARY for Treasury — K9955; * SECRETARY for Finance — K1637; and * DEPUTY Secretary (Finance, operations) — K4910. In response to PAC Chairman John Hickey’s query about the “excessive’’ cost, Mr Tarata, after a whispered conference with his key officials, said that there was a security contract entered into between the department and the firm to supply static guards at the residences of the four leaders. “At that time, you will appreciate that law and order (problems) was at its highest,” Mr Tarata told the committee. When asked to name the security firm, Mr Tarata said: “Alert Security Services.” Mr Tarata also identified the principal of the firm as Caspar Wollom. Mr Wollom, then a businessman, won election to Parliament last July on a People’s Democratic Movement ticket. The party is led by Sir Mekere who is now Opposition Leader. When reminded about the Salaries and Remuneration Committee’s determination on security allowances, Mr Tarata agreed that if the law had been followed these amounts would not have been paid. Asked who authorised the excessive payments, Finance Secretary Thaddeus Kambanei said; “It would have been captured in the contract at that time. The excessive amount was because of my termination of this contract. When I took office, I terminated the security firm . . . I’m at a loss to explain who authorised that.” Mr Hickey directed the department to provide the original contract to the PAC Chairman or in his absence the PAC Secretary. Mr Tarata also came under the spotlight for the cost of a lock for his residence — K1095. Mr Hickey asked why the lock replacement cost that much. Mr Tarata lives on exclusive Davetari Drive on Touaguba Hill. The repair was paid for by the department and the committee queried how that could be when Mr Tarata receives a K31,200 a year housing allowance. Mr Tarata said that he had not seen the management letter related to this but indicated he could repay the “excess’’ on his security bill and the cost of the lock to his residence.
THE Government paid K807,907.17 for Treasury Secretary Koiari Tarata's medical bill in Australia in late 2001. Auditor General Mark Wani's report to Parliament yesterday revealed that the payment was done without detailed explanation from the Treasury Department on the "extra-ordinary" payment despite repeated requests in March this year. Mr Wani's report on the audit of the accounts of the Department of Finance and Treasury for 2000 and 2002 also indicated that in the absence of proper documentation and approvals, the expenditure was considered "illegitimate and needed to be fully recovered". Mr Wani's report also cited instances of gross abuse of vehicles, vehicle allowances, travel allowances and restaurant entertainment, running into hundreds of thousands of kina. In one instance, some officers of the Departments of Defence and Finance wined and dined, running up a bill of K6,109 in seven days. In another, staff were collecting US$450 a day in overseas travel allowances when they were entitled to only $300 per day. Mr Tarata was also collecting $450 a day for 60 days while on sick leave. Either him or his predecessor was collecting vehicle allowances while having fully use of a secretary's official vehicle. Mr Tarata fell ill in late 2001 and was transferred to Wesley Hospital in Brisbane, Australia, accompanied by wife and his medical doctor. The audit report disclosed that expenditures for medical treatment and other associated costs totalled K807,907.17. Funds were drawn from three votes of the department to pay medical expenses as follows: miscellaneous multi-function: K676,611.57; general unforeseen expenditure: K98,303; and information technology division: 32,792.60 The report said a total of K682,008,01 was paid to the Wesley Hospital for medical expenses while K125,899.16 was paid as accommodation and allowances. "It is unclear on what basis Wesley Hospital was selected for providing special medical treatment to him. "These payments were not supported by detailed schedules of costs items or invoice from Wesley Hospital. The payment vouchers were not processed to conform to financial procedures. Proper approval, authorisation, certification and support documentation lacked in the process. "The secretary also claimed overseas allowances at the rate of US$450 per day for 60 days amounting to $27,000 (K105,233.16 at the exchange rate of 0.2565 on November 14, 2001)," the report said. The department did not provide any report to indicate whether Mr Tarata was granted sick leave with or without pay during this period. Attempts were made by the department to recover medical expenses from his insurance company but the firm refused to accept indemnity, stating that the illness was due to a pre-existing condition. "We note that there is no evidence to confirm that the department contested the decision in order to recover the amounts paid," the report said. "We further note that some cheques raised for the payment of the secretary's medical expenses were shown as cancelled or repaid in the payee history reports. However, no evidence was produced to support purported repayments totalling K199,573.49. An audit letter was issued to the Department of Treasury on March 7, 2003, and was followed up again on March 21 seeking comments, clarification and explanation and relevant documents as contract of employment and bank statements but there was no adequate response. Mr Wani noted that a detailed response from the department is being "unduly delayed" therefore the audit is unable to vouch and satisfy the propriety of the payments in accordance with the provisions of the Public Finance Management Act. Mr Wani concluded that in the absence of relevant information and records and the lack of adequate response from the department, it appears that the payment for the secretary's medical expenses "is not consistent" with the law. A public service leader's entitlement in such situation only provides for an allowance equivalent to the premium cost of medical and health insurance under any medical health insurance scheme approved by the Salaries and Remuneration Commission Determination G97-5. The audit report did not place any financial limits but went on to say that the "payment of this nature and significance had to be properly approved and authorised". "In view of the fact that the expenditure incurred is extra-ordinary and material in nature, it has to be strictly adhered to financial regulations and procedures in terms of authorisation, approval and certification and fully supported by proper documentation to that effect," said Mr Wani in the report. He said despite the secretary's long service at senior levels and being eligible for insurance cover as head of department, he was unable to pass in audit that these payments are in order. Mr Wani recommended that the payments receive a covering approval in terms of the Public Finances (Management) Act. "In the absence of these approval, the payments are considered illegitimate and needs to be fully recovered," he said.
THE deposit and withdrawal of two cheques totalling K1.2 million into a personal bank account via ATM and EFTPOS machines is one of nine misconduct in office charges facing Yangoru-Saussia MP Bernard Hagoria. The leadership tribunal chaired by Justice Salamo Injia and assisted by two senior magistrates began its hearing on Friday into misconduct in office allegations against the MP over his use of K1.2 million, part of his electorate’s district support grant for the years 1997, 1998 and 1999. The hearing commenced after a failed attempt by Mr Hagoria’s lawyers on Thursday to get the National Court’s permission to conduct a judicial review of the Ombudsman Commission and Public Prosecutors’ decision to refer the MP. Counsel Davies Stevens, acting for Mr Hagoria, told the tribunal his client would tell the tribunal during the course of its proceedings, that he received two cheques of K1.15 million (PNGBC cheque 635758) and K60,000 (Bank of Papua New Guinea cheque 2071) respectively from Treasury and the Office of Rural Development (ORD). The MP subsequently deposited them in his PNGBC-Wewak personal account 3066222999. He said Mr Hagoria would deny all nine allegations stated by the Ombudsman Commission as the monies were spent in the appropriate manner and the Yangoru-Saussia joint district planning and budget priorities committee (JDPBPC) was aware and involved in its disbursement. Witnesses would be called to support the MP’s evidence. Jack Pambel, lawyer representing the State, said the main crux of their argument would be that Mr Hagoria received the money and used them in an illegal manner contrary to NEC guidelines and statutory requirements. And that the monies were used for the MP’s own benefit and not that of his electorate. The tribunal heard that the monies were withdrawn through 208 different transactions. These included 77 unverified and improper debit transactions by writing out cheques to pay cash, 76 unverified and improper transactions through automatic teller machine (ATM) withdrawals to get cash and about 55 unverified and improper debit transactions through funds-transfer-at-point-of-sale (EFTPOS) for personal goods and services. The hearing was adjourned to Wednesday.
Pay review! Prime Minister Sir Michael Somare has promised a review of salaries that could set a standard public-sector wage for chief executives near to his own K175,000 package. And he warned his colleague MPs in Parliament yesterday that some allowances would be slashed in recommendations he would give to the Salaries and Remuneration Commission (SRC). Sir Michael said that K300,000 to K450,000 in salary packages were excessively high, even for the private sector which hardly pays these amounts. He also revealed that Dr Dan Weise’s proposal to have his company Mulroy Ltd engaged by the Independent Public Business Corporation for K1.4 million has been slashed down to K600,000. The Prime Minister said this while answering questions raised by Western Governor Dr Bob Danaya. Dr Danaya — incensed over the millions of kina paid by the State which has even victimised his own province for legal, accountancy and other consultancy fees — wanted to know if there were any control mechanisms in place for professional fees. “Attempts must be made to control or stop this process. Commissions of inquiries are expensive. Yet the Government sees fit to set such bodies up and pay them thousands and millions,” Dr Danaya said. Sir Michael said: “I am now reviewing this; and I am bringing this salary that was set up on the top down.” “If the Prime Minister of the country can get K175,000 — why should we get a man who is in charge of IPBC to get K600,000 or K1.5 million?” he added, drawing cheers of approval from various parts of the Parliament chamber. Sir Michael said there was a system in place for monitoring professional fees, which allows room for negotiations. Sir Michael said that this system takes into account the contribution that one makes and the workload that is given to a firm, an individual or a body. With this system, Sir Michael said, “Dr Weise, when he asked for his contract to be K1.4 million a year, I was able to reduce the amount down to K600,000.” “Ministers are not involved at all; we have a system in the public service — if tenders are much higher — it is then considered by tenders board; tenders board has the power to grant tenders”. On salary reviews, Sir Michael has set up a small team to make recommendations when appointments are made for department heads, statutory bodies or independent bodies where people are appointed as managing directors. “The fees that we set originally were too high. Some of them are K450,000; some of them K1.5 million,” he said. “Now I have recommended to even SRC that it should be standard form.” He said the ideal situation was that both salary packages for public service and those in State enterprises were equal. “I know the private enterprise will not pay K300,000 or K400,000 for an individual who is performing a task as managing director. “I know for a fact that in PNG, it does not happen,” he said, dismayed at the State instituting a program of getting people on much higher packages and he intends to see change.
THE Government is finalising moves to engage founding former army chief and MP Ted Diro as a special security advisor for more than K270,000 a year. And pressure is being exerted on Attorney-General Francis Damem to give the nod for the contract to be signed. Mr Diro’s role — if approved — would duplicate roles already played by members of the National Security Advisory Council (NSAC) to the government. NSAC chaired by Chief Secretary Joshua Kalinoe comprises the Defence Force Commander, the Police Commissioner, the National Intelligence Organisation Director-General, Correctional Services Commissioner, Inter-Government Relations Department Secretary and the Attorney-General. The NSAC has a small secretariat headed by former PNG Defence Force Commander Brigadier-General Gago Mamae. NSAC reports to the National Security Council chaired by the Prime Minister and the ministerial heads of the organisations that make up the NSAC. Mr Diro’s contract is understood to be K227,840 a year, paid monthly at an equal rate of K18,986.67 plus school fees of K15,200. In addition to this, he is to be paid 25 per cent of the base fee component as a lump-sum following the successful completion of the programs that are mutually agreed to between Mr Diro and the Chief Secretary. It is believed that the contract, which was originally drafted to take effect on October 10, last year would, when signed, take effect from last September. This would authorise Mr Diro an automatic payment of nearly K95,000 once the contract is signed. Mr Diro, the founding father of the People’s Action Party, which he led in Parliament rising to deputy prime minister, is to identify key external and internal threats on national security and the internal affairs of PNG to Sir Michael and Mr Kalinoe on law and order issues, sovereignty and national security, and roles and functions of the disciplined services. He is also expected to represent the Prime Minister and/or the Chief Secretary in delegated or directed roles on specific issues in dealing with ministers, constitutional office holders, departmental heads, governors, provincial administrators, heads of PNG diplomatic missions and heads of foreign missions, similar officers in foreign governments, and international agencies dealing with policy and strategic functions. Mr Diro in his role as special advisor or consultant would undertake policy reviews of development and reform issues impacting upon and relating to national security and internal affairs. Both Sir Michael and Mr Kalinoe are in Malaysia and could not be contacted for comment on questions raised with the Prime Minister’s Media Unit in relation to Mr Diro’s proposed contract. However, the areas Mr Diro was expected to advise are among many in a wide range of issues; level of financial appropriation in the law and order and national security components of the national budget; the need for the constitutional and legal implications of and the strategies for rationalising and streamlining the three disciplined services; and the need for and the financial and social viability of a National Youth Service.
A FORMER Southern Highlands politician is alleged to have misappropriated K12 million belonging to the province in the last six years. And more than K106 million was also misappropriated and misused around the same time. Inter-Government Relations Minister Sir Peter Barter told people at Koroba High School grounds on Friday that an “individual stole and misused the K12 million”. However, reliable sources said the individual referred to was a former politician. In another instance, when the provincial administrator was suspended, more than K2 million was allegedly misappropriated, the source said. Sir Peter, who is also responsible for the province in the absence of an elected governor, told a large crowd that these and other findings were contained in an audit report prepared by the Auditor-General. He said he had also given a copy of the report to the police for further investigation into the allegations contained in the report. Sir Peter said the report contained far more than that and showed these monies were not acquitted and allegedly misappropriated by certain people. He also said another individual stole K830,000 and of that K500,000 was later recovered. Documents made available to Post-Courier show that from the K830,000 allegedly stolen, K500,000 was deposited through Treasury Bills and it was retrieved through a National Court order. Transport Minister Don Polye — then acting as Inter-Government Relations Minister — on January 24 wrote to the Registrar of National Court: “As you are aware, K500,000 was retrieved from (named) Treasury Bill through the National Court. “The National Court ordered that the monies be paid to the Southern Highlands Provincial Government.” Mr Polye also said in the letter that the money should then be released to the Koroba/Kopiago district for intended projects. However, in another letter to the Bank of South Pacific written on the same day, he directed that the money be cleared to the District Administrator of Koroba/Kopiago. Mr Polye said the suspect was arrested and charged and was out on a K1000 bail. Deputy Police Commissioner Tom Kulunga confirmed that the suspect was arrested and charged with misappropriation of K332,000.
MPs CONSTITUTIONAL office holders’ pays have doubled in the past two years. The Salaries and Remuneration Commission’s 18th report — updated on January 1, 2002, shows the Prime Minister’s pay was K82,689 on January 1, 2000. It was doubled to K165,000 on January 11, 2001, and topped up to K172,770 this year. The Chief Secretary’s pay was K51,852 on January 1, 2000. A month later, it was upped to K128,395. He is now on K134,518 a year. The Chief Justice was paid K80,220 a year in January, 2000. A month later, it was K164,270. He is currently paid K172,007 a year. The Parliament Speaker was on K75,625 in 2000 but a year later, his pay went up to K140,000. It is now K146,645. The deputy prime minister and the opposition leader were paid K63,851 each in January 2000 but by January 11, 2001, their pay had been increased to K100,000. They are now being paid K104,845 a year. The Defence Force Commander and the Police Commissioner’s pays were set at K52,545 in January 2000, but a month later that was doubled to K102,770. They are now on K107,740. The Chief Ombudsman was on K62,920 in January 2000. A month later, his pay was doubled to K102,770. In January 2001, it was reset at K115,000 and now draws K120,520 a year. Ministers’ pay was set at K47,367 in January 2000. In January 2001, their base pay was increased to K80,000 and had since been readjusted to K83,945 from last January. Others whose pay was increased were the Auditor-General (from K52,000 to K107,000), national court judges (from K61,000 to more than K107,000) and heads of central agencies (from K51,000 to over K107,000). Entitlements for constitutional office holders were also adjusted up with the Prime Minister and his deputy, the Speaker, Leader of the Opposition and the Chief Justice receiving K15,500 a year in entertainment allowance. Ministers, Clerk of Parliament, Police Commissioner and the Defence Force Commander receive K9050 in allowances. They are also entitled to a vehicle, driver, accommodation and gardener’s allowances.
STAFF at Post PNG stole K3 million from the company between January 2000 and November 2001, the Parliamentary Public Accounts Committee heard yesterday. The committee further heard that K1.3m of this money was through thefts of Salim Money Kwik (electromagnetic money order). Interim liquidator Simon Fraser had stated in his report that Post PNG management had failed to stem out theft, which has been carried out by staff. "It appears endemic in this business that Post PNG is 'open season' for any staff who wish to steal funds. Employees have exploited control weaknesses to engage in theft understandable if not forgiven, having seen senior staff do the same," he said. As at August 2001, Post PNG was insolvent and had incurred losses of more than K15 million in four and a half years of operation. The payments and claims made to six dismissed managing directors amounted to K4m. Mr Fraser said court actions are being taken recoup the K4 million paid out to these individuals. He said in one instance, a former manager of Port Moresby post office put K526, 000 into his private account over a period of time instead of the company account. Post PNG managing director Peter Maiden told the PAC hearing yesterday that he had never in his life seen an organization is such poor health and a recovery plan was in place to turn the company back into solvency and positive equity. Mr Maiden said between 1998 and 2001, there was total lack of inter-control within the company, including lack of planning, control and communication to its 70 field centers. He said strict controls are now being put in place to curb these problems, resulting in some 50 employees being terminated in the last 15 months. "We have no tolerance for theft, fraud and bribery ... these seems to be disappearing," he said. He said since Aug 21, 2001, Post PNG has had only one loss through theft by staff members, while all other thefts have been reported to the Police Fraud Squad. "You ought to be congratulated," commended PAC chairman John Hickey. Mr Fraser said an analysis of Post PNG operations also shows that only nine of the 70 operations are profitable with Rabaul or Kokopo being the biggest loser. Port Moresby saw the biggest SMK theft of K341,994 between January 2000 and November 2001 followed by Kiunga (K74,509), Morapuput (K70,000), Finschhafen (K55,000) and Stop & Shop Hohola (K44,643). Mr Fraser said SMK fraud is collaboration between staff members and as such Post PNG always pays for the public sending and receiving money. But when someone within the organization sends the same SMK document to a remote post office for payment to a collaborator, the company is paying twice on the same SMK, leaving a "hole in the bucket''. The inquiry into Post PNG resumes this afternoon.
POLICE Commissioner Joseph Kupo says he traded in his three-year-old vehicle because it was “under powered”. Mr Kupo said this in answer to a a set of questions relating to why a vehicle purchased by former police commissioner John Wakon was changed during the election period for a top of the range Toyota VX Landcruiser which costs around K350,000. “Although the old Toyota was mechanically sound, it lacked power due to the engine being under powered for the size of the vehicle,” Mr Kupo said in a prepared answers to the questions. “The vehicle did not have the mobility to manoeuvre and climb steep roads quickly which could have placed me in a security risk situation. “The new VX with the turbo charged engine had overcome all the difficulties the previous vehicle had.” He said the old car, a Toyota Landcruiser, was purchased by Mr Wakon in August 1999, and was three years old when it was traded in before the election period for the new vehicle. Mr Kupo said the trade-in price for the old Landcruiser was K85,000 which was a good price considering the vehicle was purchased for K115,000. “The new VX, including all on the road costs and VAT, was priced at K298,333.20 less trade-in of K85,000, leaving a balance of K213,333.20 paid by the police department,’’ Mr Kupo said. He said the balance was paid when he took delivery of the vehicle. Mr Kupo said the old Toyota was on the list for replacement this year. He said K1.5 million was appropriated under the 2002 vehicle replacement program and the money to pay for the VX came out of that appropriation.
THE Mineral Resources Development Company is said to have incurred K7 million in "bad debts" while managing Gobe petroleum project landowners' equity funds. Independent investigator Rex Paki, who began probing allegations of misuse of the Petroleum Resources Gobe Limited (PRG) royalties yesterday, said that this was one of the first pieces of information brought to his attention on only his first day into the investigations. "I will make sure that every toea is accounted for. It is the simple village people's money," Mr Paki told The National. Mr Paki was appointed investigator by members of the PRG board of directors, Obed Posou, deputy chairman Jimmy Kinobu and chairman Philip Kende. However, MRDC managing director Dan Kakaraya released a statement on Wednesday night denying this had taken place and accusing Mr Paki of attempting a coup on his management and therefore defying ethical and good company practices. Mr Kakaraya also said the duly appointed auditors of MRDC and PRG was major accounting firm, PriceWaterHouseCoopers. However, Mr Paki said he was working together with landowner lawyer John Kil in the investigations and denied assertions to the contrary by the MRDC management. He said he doesn't need to go into MRDC offices to conduct investigations as he was already collecting sufficient information from outside, and he promised to "drop the bombshell" next week. "The big picture is that a lot of money is unaccounted for. This is not comparable with the NPF investigations where only K2 million went missing, resulting in a Commission of Inquiry," said Mr Paki. He said about two weeks ago, the board of directors of PRG met in Cairns, Australia. In the meeting, the MRDC management asked the board if K7 million could be written off as bad debts. However, according to Mr Paki, the board of directors flatly refused to accept Mr Kakaraya's request and deferred the matter for discussion to another date. Mr Paki said he would find out how that K7 million was spent and he wanted all the landowners from Gobe to know that all the money must be accounted for. Already, Mr Paki has information on how much oil has flowed out of Gobe since production began. Combining that with the price of oil every month since 1997 should give an indication of the 2 per cent value of Gobe people's gross equity dividend funds, less costs and cash calls.
THE Central Supply and Tenders board serves “political masters of the day”. That’s how Treasurer Bart Philemon yesterday described the government body that lets contracts for government projects. He was replying to questions in Parliament from Eastern Highlands Governor Mal Smith Kela querying previous decisions made by the board on contracts that cost more than what they were worth. Describing these as “padded contracts”, Mr Smith Kela, a businessman, cited as examples the purchase of the old Defence Force Arava aircraft for $US16 million (K64 million) which he said was really worth $US6 million (K24 million). He also questioned the purchase of military equipment through the Sandline International contract and contracting of experts, referring to the hiring of former World Bank employee Pirouz Hamidian Rad for K7 million. He said the Yumi Yet Bridge program was twice its real price and was tendered for costing the Government K115 million of which K70 million was outside of budget allocations. “Obviously, all these contracts are clearly padded,” he said as he called for neutral audits to assess the board’s decisions so “contracts fall within acceptable commercial limits”. Mr Smith Kela wanted independent expertise from the community to be engaged on this exercise. Mr Philemon, in response, said he had met with one of PNG’s international donors over concerns on control of expenditure, including the question of tenders board processes. “Quite often tenders are left out for items not conforming with the tender package. Sometimes not the best tender is accepted. There’s no standard procedure to the whole process because the tenders board serves the political masters of the day,” Mr Philemon said.
Luxury vehicle raises eyebrows A top-of-the-range Toyota Landcruiser purchased for the West New Britain provincial administrator is raising eyebrows around Kimbe town. And a second vehicle of the same type and range is still on order, reportedly for the Governor. One of the vehicles, a VX Turbo Toyota Landcruiser has cost the Provincial Government K327,000. The Post-Courier was told that the vehicle earmarked for the administrator, with registration number PAC 489, was released to the provincial administration this week, and was being used by aid agencies visiting the province to assist volcanic victims. The purchased of such flashy vehicle is against National Government direction to cut costs and expenditure on such luxuries vehicles, although it was ordered last year. But it also comes at a time when the province needs every toea to assist in the disaster relief operation. Yesterday, provincial administrator William Padio confirmed the purchase of the vehicle, but shifted blame to administration staff and the finance division. Asked to confirm reports of a second vehicle being ordered for the Governor, Mr Padio said he could not speak for the Governor. He said the vehicle was purchased under his contract of employment and payment was made over a period of four months. And he said he was prepared to return the vehicle if the people in the province were upset about it. Mr Padio referred the Post-Courier to executive officer Fred Raka, who said the administrator had been using a six-year-old vehicle and saved the new one. Mr Raka also sidetracked on the question of why such an expensive vehicle was bought. The purchase has already drawn criticism from people who have called on the administrator to justify expenditure on such a luxury vehicle while the people were suffering from the volcanic disaster.
MORE and more working class women are getting in trouble with the law, particularly for stealing huge amounts of money. One is about to be charged with trying to cash a government cheque of K10 million, while two appeared briefly before the courts yesterday for allegedly stealing more than K150,000 and K300,000 respectively. Police prosecutors have expressed concern over women going through the courts for allegedly stealing huge amounts of money. “This appears to be a new trend now that we see working class women in conflict with the law,” a police prosecutor said. The prosecutor said a woman would be charged soon for trying to cash a government cheque for K10 million. He said arresting officers had been seeking advice from the prosecution office to ensure correct charges were laid against the woman. Yesterday, another woman from East Sepik Province appeared briefly before the Waigani Committal Court. Her case was adjourned to 9.30am Friday. Miriam Ngaffin, 34, was charged with 75 counts of false accounting amounting to a total of K169,174.39. She had allegedly overpaid workers from a motor dealing company and later collected the overpayments and paid them into her private bank account. The alleged offences took place between January 20, 1999, and March 29, last year. Police arrested and charged her on August 13, after a lengthy investigation. Another woman also appeared before the same court yesterday on false pretence charges amounting to a total of K319,350 — money belonging to East New Britain Provincial Government education department. Veronica Charlie’s case was adjourned to August 26, for the hearing of an application to have the matter transferred to Rabaul where the alleged offence took place. The police prosecutor said there were also a lot of women bankers involved in cashing stolen or valueless cheques. He said women working with commercial banks may have had directly or indirectly involved themselves in false pretence and forgery.
THE Office of the Public Curator is reportedly owed K20 million by superannuation funds and has run out of funds. The money is said to have been advanced to surviving relatives of deceased contributors on the understanding that the super funds would reimburse the Curator. Public Curator and official trustee Paul Wagun said yesterday his office now found itself unable to pay new claims because it had no more money. Mr Wagun said of the money owed, more than K15 million was paid in advances over the last 10 years to benefactors of the deceased, with K2.5 million in cheques cashed at supermarkets in Port Moresby “under questionable circumstances”. A further K1.5 million was paid to a consultant but this was also done “under cloudy circumstances”. He said there was another invoice for K1 million from the same consultant company pending payment, which Mr Wagun had so far refused to pay because he says there was no work done in the form of consultation. Mr Wagun also revealed that more than 1000 properties left behind by deceased people were now owned by the wrong people through fraudulent means. Mr Wagun said the advances of more than K15 million over the last 10 years made to relatives and benefactors from dead people’s money was done in the belief that the super funds would reimburse the Public Curator’s office but this had not happened. He said his office was now awaiting a decision from the National Court on the recovery of the money. Mr Wagun said the dilemma was brought to light when a widow called in collect K600,000 but could not be paid because the Public Curator did not have the money. He also highlighted cases involving two officers stealing from the office. Both men were sacked. In one incident, an officer was caught corroborating with a another man by feeding him with details of the dead person and his relatives. The man then went to the office identifying himself as a next-of-kin and came to collect a K27,000 cheque. When police arrested the imposter, his office collaborator ran away but was eventually arrested and charged. In another incident, a senior officer had his staff write out blank cheques in the pretext that he would fill the rest out and give the cheque to the benefactors. He instead wrote open cheques and cashed them himself. Mr Wagun said these were only two examples of deceased people’s hard-earned money being stolen. In the case of properties, he said some people got around procedures, obtained land titles and had them transferred to themselves. He said he had already investigated and repossessed four of these properties but to complete the rest he would need two permanent lawyers and money to properly litigate these cases.
EXECUTIVES of the PNG Police Association are being investigated over their handling of funds totaling K8.8 million belonging to serving members of the police force. Three of the Police Association executives are serving policemen - one of them an acting assistant commissioner. Port Moresby police chief Superintendent Emmanuel Hela confirmed the investigation yesterday, saying that the CID will first question the union executives over the use of K550,000 belonging to the association. Mr Hela said investigators will try to account for every toea of the K8.8 million in members' contribution that was paid to the association between 1994 and 2001. The funds in question are union fees deducted by the police department and paid fortnightly into the association. The deductions worked out to an average of K520,000 a year for 17 years. Industrial Registrar Helen Saleu suspended the union executives in mid-June however, they went to court and appealed against their suspension and the matter is still pending. Mr Hela said the investigation was prompted by a letter of complaint signed by 42 financial members who expressed their concern on behalf of all members. He said he had studied the files and reports submitted to him and was satisfied that there were enough grounds to investigate and lay charges. Mr Hela said the initial investigation relates to four undated cases. The first involves K200,000 that was deposited with a finance company. The money was then used as security to obtain loan to buy two dinghies and outboard motors and a motor vehicle. The second case involves the use of K150,000 from the association's superfund for which there were no clear transactions shown and no explanations on why the money was not repaid. The third case involves the association owing a law firm K50,000. The fourth case involves K150,000 which was used to buy 150,000 in shares at K1 per share in a company. A total of K17,000 of this money is unaccounted for. Mr Hela has recommended that further court orders be granted to ban the executives from having access to all members' funds within the Police Association, the association superfund and the police credit fund.
AGRICULTURE and Livestock Minister Simeon Wai has given the National Agriculture Quarantine and Inspection Authority (NAQIA) board four working days as of yesterday to explain how senior executives had paid themselves out in 1998 and continued to remain in office. Mr Wai summoned chairman Daniel Takendu yesterday to explain if the board was aware of the pay-out after The National revealed the issue this week. The minister later told a news conference that he had asked Mr Takendu to provide details of the payments totaling more than K600,000. He said he had instructed the board to verify the payments, including the amount paid to each of the staff, and if the funds were approved by the board. He also wanted to know if the board had instigated measures to recover the money paid. Mr Wai revealed that he had been made aware of the matter recently and had tried to meet with Mr Takendu on May 3 to take appropriate action. "The nature of the allegations is quite serious and I will get to the bottom of it and ensure appropriate action is taken against those responsible, if those payoffs were indeed made," Mr Wai said. "If public funds have been misused as alleged, every effort will be made to recover those funds." Meanwhile, the NAQIA board held a marathon meeting yesterday to discuss the issue and prepare an explanation for the minister.
TELIKOM Ltd has paid one of its former managing directors K1.5 million in an out of court settlement. The Post-Courier understands that the board met two weeks ago and approved the payment for Philip Aki, who served three weeks of his five-year contract. Former Prime Minister Bill Skate appointed Mr Aki as Telikom managing director in July 28, 1999 for a five-year term. However, then Corporatisation and Privatisation Minister Vincent Auali sacked him on August 11 the same year for paying himself K120,000 in housing allowance within two weeks of being in office. Telikom managing director Sunil Andradi yesterday denied any involvement in the decision to settle the matter out of court, saying he would refer the Post-Courier’s queries regarding the settlement to the board. Other Telikom sources said there was considerable political pressure placed on the board and management to settle the payout, which is expected to be paid out in installments. The Post-Courier quoted Mr Auali on August 16, 1999 that Mr Aki’s appointment was revoked “on the grounds of serious allegations of financial mismanagement’’. “I have been furnished with documents that the former managing director (Aki) had been paying himself huge advances of benefits while he has served two months of his five-year contract,’’ Mr Auali, who is the current Privatisation Minister, was quoted as saying. “On August 4 (1999), I issued a specific instruction to all government instrumentalities, advising that there be no capital expenditure, including payment of contracts and other benefits but Aki proceeded to pay himself an advance,’’ Mr Auali said then. Mr Aki confirmed to the Post-Courier then that he had received the allowance to renovate his house but said he had obtained advice from the Telikom who said “everything was in order according to his contract’’, and that normal administrative procedures were followed all along. Mr Aki was the First Secretary to Sir Peter Lus, the then transport minister when he was appointed to the Telikom job. He is currently serving as Sir Peter’s executive officer. Sir Peter is the Minister for Culture and Tourism. Mr Aki has also served as managing director of Pacific Mobile Communications, a wholly owned subsidiary of Telikom, prior to his appointment. He was also suing the State for wrongful termination from Pacific Mobile.
TWO recently resigned members of Parliament are to be investigated for the misappropriation of more than K200,000. Public Prosecutor Chronox Manek yesterday asked Police Commissioner Joseph Kupo to probe allegations of misappropriation of the Gaming Board monies against ex-MPs Bernard Mollock (Bogia) and Kuk Kuli (Anglimp-South Wahgi). Mr Mollock resigned his parliamentary seat on April 30, to avoid fronting before the Sir Robert Woods leadership tribunal yesterday on allegations he unlawfully received K57,000 from the Gaming Board. Mr Kuli was to appear before the same inquiry on April 30, but resigned on April 26. He is alleged to have unlawfully received money in the form of three cheques totaling K175,540 from the Gaming Board too. They were alleged to have converted the money for their own use and failed to disclose to the Ombudsman Commission the benefits that came into their possession as a result of receiving the monies. Under the law, Mr Manek said the two leaders could not be tried by a leadership tribunal unless they returned to public office. But that did not mean the pair could not be investigated under the criminal process, citing section 30 (1) of the Organic Law on the Duties and Responsibilities of leadership which stipulates that: “The result of any proceedings in respect of a charge of misconduct in office is not a bar to proceedings in respect of the same act under any other provision of the Constitution or any other law.’’ Mr Manek said he considered the statement of reasons which the Ombudsman Commission had found that there was more than sufficient, credible and admissible evidence, which could be investigated and compiled for purposes of a criminal prosecution. He said in his view “there was overwhelming evidence for charges of misappropriation in relation to the cheques received by Mr Mollock and Mr Kuli issued by the Gaming Board Control Board and negotiated by the two leaders’’. Mr Manek said he will make himself available to provide help to police if they need his assistance in their investigations.
TEN of Prime Minister Sir Mekere Morauta's ministers (named) were paid a total of K920,000 from National Gaming Board funds, according to the former registrar of the board, Paul Aisa. He said he could not speak out earlier on the matter because he was charged with misappropriating K3.5 million of Gaming Board funds. He admitted yesterday that he was personally involved in paying the ministers and MPs through cash and cheques. Former registrar of the National Gaming Board funds, Mr Paul Aisa. Mr Aisa, who was acquitted by the Waigani Committal Court on Monday, said he was prepared to give evidence against 29 MPs including the 10 ministers who had allegedly misappropriated Gaming Board funds. "I paid them the money in cash, I have cheque numbers and supporting evidence. I was used as a scapegoat. I am prepared to be a witness in any court to testify against the leaders," he told The National in Port Moresby. He is contesting the Kairiku-Hiri Open seat held by Bougainville Affairs Minister Sir Moi Avei. Sir Moi is NOT among the 10 ministers. "I am now willing to be a State witness in any inquiry or court," he stressed. Mr Aisa produced documents that showed one minister was paid in two lots of K50,000 and K135,000, another received K150,000 and another was paid K115,000. Two others received K100,000 and K60,000 while the rest received K50,000 or less. Mr Aisa said one minister was supposed to buy an ambulance for his electorate but instead bought a utility truck which was being used for his re-election campaign. "The minister who received K60,000 purchased a maroon-colored vehicle that is being used privately in Port Moresby," he said. The documents showed that a former minister (named) received the biggest share of the funds totaling K880,000, which were paid to him through seven different cheques. Two former ministers in the Skate government received K200,000 each while four provincial governors received a total of K340,000. Amounts ranging from K20,000 to K150,000 were paid to the rest of the 29 leaders, 14 of whom have been charged and seven are facing the Leadership Tribunal. Two other MPs, who were due to face the Leadership Tribunal, this week submitted their resignations from Parliament. "A lot of MPs and ministers have benefited immensely and I have been made a scapegoat," he complained. Mr Aisa said he had submitted all details of cash payments totalling K3.5 million, cheque numbers and names of MPs and ministers to the Ombudsman Commission. He produced copies of the documents to The National yesterday which showed a list of cheques that were cashed by the 29 leaders (named) that amounted to K3,665,000. Mr Aisa did not go public regarding the issue after he was sacked from his job as registrar and was consequently charged. Committal Court magistrate Alan Kopi ruled on Monday that a prima facie case was not established against Mr Aisa. Mr Kopi discharged Mr Aisa from the six counts of misappropriation charges under section 383 A of the Criminal Code. He was charged with misappropriation of Gaming Board funds totalling K3.5 million between February 1998 and July 1999. During this time, Mr Aisa was responsible for the operations and management of the Gaming Board and one of his functions involved distributing funds into a trust account. He said he was personally involved in paying out the cheques to MPs. At one stage, he said, one Minister had demanded K1 million in front of two of his ministerial colleagues, "but I could not pay him that." Mr Aisa said 10 per cent of the total Gaming Board revenue was distributed to the trust account and six per cent went to a community benefit fund which amounted to about K3-4 million annually. "The money from the fund was then distributed to MPs when we received instructions from the (then) Finance and Internal Revenue Minister, and Treasury Minister. During this time some of the funds were cashed because members wanted the money for various projects, which they misused," he said. During the change of government in July 1999, police were instructed to charge Mr Aisa without any proper evidence. He was charged three times -- in 1999, 2001 and 2002 -- but cleared of the charges because of lack of evidence. "I want to tell my supporters that I have been cleared of all the charges laid against me," said Mr Aisa, who is contesting the elections under the People's National Congress banner. He said he had received overwhelming support from the Kairuku, Hiri, Koiari, Nara-Gabadi people and was confident of unseating the incumbent Sir Moi.
THE Public Accounts Committee has found the Department of Works had paid out millions of kina to either bogus claims or companies with “dubious credentials”. The report, tabled by PAC chairman Peter Waieng in Parliament on Wednesday, says K22 million out of road maintenance funds were diverted to other programs. “Between 1998 and 1999, payments totaling K10 million were made from the Department of Works for which the payment details were not entered into the accounting system.” It also reads that between 1998 and 1999, more than K14 million was paid for poor quality work done by unknown contractors of “dubious credentials”. The report also states that the department did not have any records of 305 brand new vehicles purchased at a total cost of K14 million. “Payment vouchers totaling K5.8 million did not have any kind of contract or agreement attached to them, which indicated that these payment were made without any valid contract.” The report also says that K123,104 was paid to an employee of the department at the headquarters who arranged payments for bogus claims for stationary supplies to a “fictions firm” owned by the same employee. And there was significant break down in the public financial controls and wide spread violation of the provisions of the Public Finance (management) Act and procedures. Meanwhile, Mr Waieng also revealed that seven persons were arrested and charged and their cases are now before the courts. He also said a follow-up inquiry into the department would be held to see the results of implementing the committee’s recommendations.
TWO former chairmen of the Papua New Guinea Banking Corporation wrote off almost K50 million as bad debts for companies they were associated with, bank executive Garth McIlwain said yesterday. Addressing the final PNGBC board luncheon, Mr McIlwain said one was for K9 million for a company the then chairman was a director while another board chairman wrote off K40 million-plus in bad debts for a company he was chairman. Mr McIlwain did not identify the two past chairmen involved. He told directors, senior PNGBC management and guests that all these actions over the years contributed to eroding the bank’s capital base. “. . . surely, these instances alone are justification for the privatisation policy,’’ Mr McIlwain said. “The bank could not survive with severe corporate governance deficiencies such as these, which eventually eroded the bank’s capital base.’’ Mr McIlwain said these all culminated in the “black September in the history of the bank’’ — referring to September 2000 when the bank found out about the “enormity of the almost tragic circumstances of the bank’s financial position’’. PNGBC made an operating loss of K41 million that year...
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