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FRIDAY, OCTOBER 19, 2018
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Social Services shredded records in fraud cover-up By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net
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HREDDING documents to cover up fraudulent activities was “a matter of routine” at the Department of Social Services, the Auditor General has revealed. The Government’s chief financial watchdog, in his audit of the 2014-2015 fiscal year, warned that “impaired internal controls” and “a severe breakdown” in
management oversight had exposed Bahamian taxpayers to the potential loss of millions of dollars from graft and corruption. The report, tabled in the House of Assembly on Wednesday, suggested that the department’s weaknesses and failings were also undermining its mission to assist poor and low income Bahamians. Among the key findings were: • The Auditor General’s investigation was “impeded” by a “senior accounts staff member”
Post Office Bank ‘didn’t know’ the level of client deposits By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net THE Post Office Savings Bank did not know how much money it held in customer deposits when examined by the Auditor General for the 2014-2015 fiscal year. The Government’s financial watchdog, in a report tabled in the House of Assembly on Wednesday, revealed that Savings Bank staff were unable to determine the amount of funds held in both active and dormant accounts. Calling, with deft understatement, for the Post Office to calculate these sums, the Auditor General’s report said: “We were informed that the dollar
value for both the active and inactive accounts could not be determined by the staff of the Post Office Savings Bank. “Further, we were also informed that there are no rules governing when an active account becomes inactive.” Some 33 percent, or 9,044 of the Post Office Savings Bank’s total 27,143 accounts, were said to be inactive or “dormant” at the time of audit, with 18,099 or two-thirds still active. The Auditor General’s report called for dormant accounts, which had been inactive for seven years, to be transferred to the Central Bank of The Bahamas to bring the Post Office Savings Bank into compliance with the
‘Bolster’ bidder disclosure for govt contracts amid woes By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net INVESTIGATORS have called for the draft Public Procurement Bill to “be bolstered” on payment approvals and bidder disclosure following exposure of the Ministry of Finance’s contract woes. FTI Consulting, which probed the ministry’s computer supply and apartment rental deals, said its “significant compliance challenges” in the absence of documented procedures and guidelines meant the proposed legislation should needed to be
further strengthened. While agreeing that the draft bill “would bring substantial improvement to the current regulatory landscape” relating to procurement, the Bahamian accounting and advisory firm said the deficiencies uncovered were so profound that its legal requirements needed to become tighter and deeper to protect taxpayer “value for money”. Noting that the Ministry of Finance had been unable to produce any written procurement policies during its investigations, FTI Consulting confirmed that the
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Integrity Commission value ‘reinforced’ by contract woes By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net THE Ministry of Finance’s questionable contract awards have “reinforced the value” of the Integrity Commission Bill and other planned anticorruption laws, governance reformers said yesterday. Matthew Aubry, executive director of the Organisation for Responsible Governance (ORG), which is about to launch a National Integrity campaign, said the probes into the ministry’s computer supply and apartment rental deals had highlighted the absence of
protection for public service whistleblowers. He told Tribune Business that ORG was “keeping the pressure” on the Minnis administration to move forward with the Integrity Commission and other reforms vital to overhauling Bahamian governance, including the creation of an Ombudsman’s office, public procurement legislation and bringing the Freedom of Information Act into full effect. Mr Aubry said the probes, conducted by FTI Consulting on behalf of the Auditor
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ordering the destruction of various accounting records, including cheques, vendor statements and receipts. Among the documents to be shredded were those from 2014 and 2015, the years under examination, as well as for the period 2010 to 2013. • The Department of Social Services processed a fictitious invoice from a medical provider, and ended up paying for a
• Accounts destruction ‘matter of routine’ • Paid for unperformed ‘procedure’ on dead client • $4.2m in payments without proper scrutiny
* LAST AUDIT WAS 13 YEARS OLD * NO INTEREST PAID FOR SEVEN YEARS * AUDITOR GENERAL: BRING INTO 21ST CENTURY latter’s governing Act. The Post Office Savings Bank must be one of the few, if any, banks worldwide not to know how much money it is holding on behalf of depositors. Not only does this inhibit its efficient operation, but in an era of greater regulatory scrutiny represents a potential supervisory weakness for The Bahamas. The Auditor General’s report also revealed that the last audited financial statements for the Post Office Savings Bank were produced in 2010 for the 2002
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non-existent procedure on a dead person. It had some 255 days to check the service was performed, but failed to do so. • Some $4.237m worth of vendor payments were made without the necessary executive management or financial officer signatures, further
exposing the Department of Social Services to loss and fraud. • “Collusion” between staff at a local food store and Department of Social Services personnel enabled the latter to use food coupons, intended to help poor and low-income Bahamians, to purchase
groceries for themselves. Disclosing its in-depth findings, the Auditor General’s Office said the instructions due to destroy key accounting documents had come from a “senior accounts staff member” “with the knowledge” of
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NHI catastrophic plan to cost under $1,000 By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net THE Government plans to roll-out National Health Insurance (NHI) catastrophic care plans costing “as little as $1,000 per year” within the next three to four weeks, it was revealed yesterday. Dr Duane Sands, minister of health and national insurance, said the Minnis administration plans to roll-out a “significant adjustment” to the scheme once it gets Cabinet approval. He made the disclosure at the Exuma Business Outlook conference, saying: “NHI provides primary care services to just over 40,000 Bahamians. We expect in the next three to four weeks to roll out a significant adjustment to the
* Roll-out in 3-4 weeks * Employees to pay under $20 DR DUANE SANDS
National Health Insurance plan to include coverage for catastrophic ailments. “Once we have gotten Cabinet’s approval, it is anticipated that we should be able to provide major medical plans for as little as $1,000 per year. That amount will be borne by
the Government of The Bahamas, the employer and the employee, with contributions on a monthly basis by the employee of less than $20 or no more than two per cent of a person’s salary and no more.” Dr Sands said The Bahamas spends almost $900m on healthcare annually. Some $306m of this comes from the Government’s Consolidated Fund, with $80m spent on health insurance for MPs, teachers, police officers and other public servants. “Bahamians pay more for health than most people in the world. We have a lousy result in terms of our health status and perhaps we can change the model,” Dr Sands suggested.