Shal­iza Has­sanali

An in­ves­ti­ga­tion con­duct­ed by Ernst and Young Ser­vices Ltd has un­earthed a $10 mil­lion trans­porta­tion scam for 130 "high per­form­ing ath­lete" stu­dents on schol­ar­ship at the Uni­ver­si­ty of T&T (UTT). The scope of the in­ves­ti­ga­tion-which in­clud­ed all trans­porta­tion trans­ac­tions dur­ing the pe­ri­od Oc­to­ber 2007 to June 2011-has un­cov­ered ma­jor ir­reg­u­lar­i­ties with re­gards to over-in­voic­ing of a Port-of-Spain un­reg­is­tered car rental com­pa­ny and pos­si­ble col­lab­o­ra­tion with UTT staff. The stu­dents rep­re­sent­ing 12 sport­ing dis­ci­plines fell un­der the pro­gramme of Acad­e­my of Sports and Leisure Stud­ies. The fraud is just one of the many of ir­reg­u­lar­i­ties un­cov­ered at UTT fol­low­ing poor fi­nan­cial prac­tices and man­age­ment in the past.

In de­liv­er­ing his pre­sen­ta­tion on two mo­tions to in­crease this coun­try's bor­row­ing ca­pac­i­ty by over $26 bil­lion through two spe­cif­ic pieces of leg­is­la­tion on Fri­day in the Sen­ate, Min­is­ter of Sci­ence, Tech­nol­o­gy and Ter­tiary Ed­u­ca­tion Fazal Karim ques­tioned the trans­porta­tion arrange­ments with the com­pa­ny, which he said was the sub­ject of an in­ves­tiga­tive au­dit by Ernst and Young. Karim stat­ed that the com­pa­ny pro­vid­ed trans­porta­tion to stu­dents in­volved in UTT's High Per­form­ing Ath­letes Pro­grammes. The Min­is­ter ex­plained that the com­pa­ny pro­vid­ed for the stu­dents who were housed at Ol­era Heights, Vista­bel­la to be trans­port­ed any­where they wished by this car rental agency.

Karim ques­tioned who were the high per­form­ing ath­letes and the process un­der which they were se­lect­ed by UTT. "The bot­tom line is that over the last few years this agency has billed for just un­der a whop­ping $10 mil­lion, of which $7 mil­lion has been paid." There are claims for just un­der $3 mil­lion, Karim re­vealed. This has been the sub­ject of an in­ves­ti­ga­tion by Ernst and Young. "The au­dit has turned up ma­jor ir­reg­u­lar­i­ties sug­gest­ing over in­voic­ing and pos­si­ble col­lab­o­ra­tion with UTT staff."

Ma­jor dis­crep­an­cies in pa­per trail

Ma­jor dis­rep­an­cies, Karim said, have been dis­cov­ered in the pa­per trail. Batch­es of doc­u­ments be­tween May 2010 to No­vem­ber 2010, Karim said, can­not be found. "There has been a pat­tern of in­voic­es be­ing signed off, 18 months af­ter pay­ment." Karim said the Ernst and Young man­age­ment let­ter in re­spect of 2008 to 2009 au­dits of UTT in­di­cat­ed weak in­ter­nal con­trol and poor man­age­ment prac­tices. He al­so said there was ma­jor fi­nan­cial is­sues re­gard­ing the Tamana project.

"Mul­ti-mil­lion dol­lar changes were made with­out prop­er doc­u­men­ta­tion, which are caus­ing ma­jor de­lays. The bot­tom line is that de­spite the high pro­files of peo­ple that held po­si­tions there, UTT is in a mess from an ad­min­is­tra­tive and fi­nan­cial point of view." The re­port re­ceived by the Sun­day Guardian showed sev­er­al ir­reg­u­lar­i­ties, in­clud­ing:

• Non-com­pli­ance with UTT's poli­cies and pro­ce­dures which re­sult­ed in procur­ing of ser­vices from a sup­pli­er with­out the guid­ance of the pro­cure­ment de­part­ment.

• No au­dit trail to as­cer­tain the en­gage­ment of the (com­pa­ny) as the orig­i­nal re­quest for quo­ta­tion or ev­i­dence of the eval­u­a­tion of the quo­ta­tions could not be pro­vid­ed.

• No ma­te­r­i­al req­ui­si­tion to ini­ti­ate sup­ply of quo­ta­tions for the pro­vi­sion of trans­porta­tion ser­vices.

• The use of UTT's ser­vice con­tract au­tho­ri­sa­tion tem­plate with­out con­sent and knowl­edge of the pro­cure­ment de­part­ment.

• UTT was over in­voiced by $456,500 and un­der in­voiced by $27,300.

• 97 per cent of pur­chase or­ders gen­er­at­ed by the (com­pa­ny) were done af­ter the pro­vi­sion of the ser­vice and re­ceipts of in­voic­es from the sup­pli­er.

Probe re­vealed

The in­ves­ti­ga­tion re­vealed that the to­tal val­ue of in­voic­es sub­mit­ted by the com­pa­ny over the pe­ri­od Oc­to­ber 2007 to May 2011 amount­ed to $9,908,450.

• In­voic­es processed and paid $7,129,050;

• cheques not is­sued $331,500; and

• in­voic­es sub­mit­ted but not paid, $ 2,447, 900.

The au­dit al­so re­vealed that six out of the 39 cheques, to­talling $2,488,300 is­sued by UTT to (name called) were made payable to the com­pa­ny. A UTT source stat­ed that the in­ves­ti­ga­tion would form part of UTT's foren­sic au­dit, which At­tor­ney Gen­er­al Anand Ram­lo­gan had re­quest­ed up­on tak­ing up of­fice in May 2010.