There is public concern regarding the status of a US$8.5 million, which was reportedly deposited in an Escrow Account at the Central Bank of Liberia (CBL) for development projects in Liberia.
The US$8.5 million in question, according to cogent information gathered by the Heritage, were accrued as proceeds from the sale of the Japanese Oil Grant.
The Heritage also gathered that some of the money had been expended. But it has no information about how the money was used.
There have been persistent inquiries by the public concerning the status of the money, with some members of the public raising eyebrows over the use of the money.
Credible sources at the Liberia Petroleum Refining Company (LPRC) and the Ministry of Finance, as a result of inquiry, confirmed that the US$8.5m was indeed placed in an escrow account at the CBL for development purposes.
But our sources at the LPRC when quizzed about the status of the US$8.5m, referred the Heritage to Finance Minister Amara Konneh, averring that the LPRC has nothing do with the money since it is already in an escrow account at the CBL.
As a follow up, this paper contacted authorities of the Finance Ministry on the issue.
But they also referred the Heritage to the Minister of Commerce and Industry, Axel M. Addy.
According to them, Minister Addy is the one armed with the necessary information as it relates to the status of the US$8.5m.
However, Minister Addy could not be reached for comments yesterday concerning the status of the US$8.5m.
This paper reliably learnt that the US$8.5m in the escrow account at the CBL is under the watch of a special committee in collaboration with the Japanese Government.
The special committee, this paper further learnt, is chaired by Foreign Minister Augustine Kpehe Ngafuan and Co-chaired by the Minister of Commerce and Industry, Axel M. Addy.
The Heritage is doing everything possible to speak to Ministers Ngafuan and Addy and other credible sources regarding the actual account of this money.
This paper believes that the GoL is under moral obligation to provide all the relevant information regarding the status of this money earmarked for development purposes for the benefit of the public whom it is serving.
It may be recalled that the Government of Japan extended a grant of one billion, one hundred million Japanese Yen (¥1,100,000,000), to the Government of Liberia(GoL) under a Grant Arrangement, provisions of which were conveyed in an Exchange of Notes dated March 8, 2011 between the Donor (Japan) and the Recipient (Liberia), for the purpose of contributing to the promotion of the economic and social development efforts by the Government of Liberia.
Accordingly, on August 30, 2011, a Memorandum of Understanding (MOU) was signed by and between the Ministry of Commerce and Industry (MoCI), consignee on behalf of the Government of Liberia and the Liberia Petroleum Refining Company (LPRC); the implementing agent for the monetization of the Japanese donated petroleum products.
The General Auditing Commission sometimes ago conducted an investigation of the Japanese Oil.
The investigation was based on information received by the GAC Audit Team based at the LPRC that there were possible "abuses" in connection with the Japanese Grant.
The investigation was aimed at determining whether the Japanese Oil delivered had been duly accounted for.
At the time of the signing of the MOU, according the GAC investigation, the Petroleum Non-Project Grant was valued at thirteen million United States Dollars(US$13,000,000.00) for the supply of 15,000 Metric Tons (MT) of petroleum products from the Government of Japan for monetization, for which proceeds would be used to support development initiatives in Liberia.
The GAC, in its findings, observed that the former Commerce Minister Miata Beysolow and Aminata& Sons did not pass down to consumers a discount of 21.19 percent at the pump, as stated in the MOU between the MoCI and LPRC.
Therefore, GAC used the prevailing wholesale market rate to determine the revenue realized by Aminata& Sons.
The Ministry of Commerce, the Commission said, maintainedthe official wholesale market rate statistics.
" At the official wholesale rate of US$4.22 and US$4.37 on the 4,196,343 gallons obtained by Aminata& Sons during the transaction, the total revenue derived from the petroleum sales by Aminata and Sons, Inc., the local distributor selected by LPRC to monetize the product was US$17,889,454.11," said the Commission.
Considering the threshold amount deposited, the Commission noted, storage fees, port charges, and administrative cost paid as well as the assumed 10 percent commission payable to Aminata& Sons, Inc., these outlays amounted toUS$12,101,320.10. Aminata& Sons, Inc. thus earned in total US$5,788,134.01 beyond the reasonable assumed commission.
The GAC further observed that the Managing Director of LPRC, Mr. T. Nelson Williams, failed to award the Japanese Oil Grant contract to Aminata& Sons on a commission basis, given that the proceeds of the grant was intended to contribute to Liberia's economic and social development efforts.
"A reasonable commission should have been ten percent on the sales ofUS$17,889,454.11, amounting to US$1,788,945.00 and payable to Aminata & Sons," the Commission findings suggested.
The Commission pointed out that LPRC did not follow the Public Procurement and Concessions Act, 2005 when it contracted Aminata & Sons to sell the donated oil on its behalf.
"The lack of a competitive bidding process denied assurance that value for money was achieved in the sale of the donated oil.
MD Williams violated Section 48(1) of the Public Procurement and Concessions Act for not subjecting the contract to monetize the Japanese Oil Grant to competitive bidding and also for not seeking No Objection from the PPCC in awarding the contract to Aminata& Sons," the audit findings asserted.
The products, according to the audit findings, were also sold on the Liberian market at the prevailing market rate without taking into consideration the gift element of 21.19 percent as indicated in MOCI's Japanese Donated Petroleum Product Cost Benefit Analysis.
"From his calculation, the gift element amounted to US$2,749,861.87. There was no evidence to indicate that this gift element was reflected at the pump. His analysis revealed that the Minister of Commerce, Miata Beysolow granted Aminata& Sons a deep discount of 35 percent, amounting to US$4,584,292.90 on the wholesale price," continued the audit findings.
"MD Williams and former Commerce Minister Miata Beysolow failed to protect the financial interest of the GoL by not ensuring that the net proceeds of the sale less a reasonable commission was deposited into government's coffers. She did not provide any evidence that MoCI monitored the MoU entered into with LPRC, to ensure that its terms and conditions were enforced by LPRC," the audit findings mentioned.
Based on the number of financial irregularities and major control deficiencies noted in the report, the GAC among other things recommended that Aminata& Sons should be made to deposit an additional US$5,788,134.01 into Government Account # 0220630001709 at the CBL, as the excess income was unjustly accrued to Aminata& Sons as a result of the transaction.
This amount includes US$16,000.00 set aside by Aminata and Sons for external audit purposes, as there is no evidence that an audit was conducted, as supported by LPRC's Final Report.
"Aminata& Sons, Inc. should be made to deposit the aforesaid amount within thirty (30) days from the date of submission of this report to the National Legislature, and submit a copy of the deposit slip to the Office of the Auditor General for validation.
Failure to do so, the Ministry of Justice should institute debt collection action against Aminata& Sons," the GAC further recommended.
The GAC also recommended that the LPRC boss should be censured by the President of Liberia for not protecting the interest of the Government of Liberia by ensuring that proceeds of the sales less a reasonable commission was deposited in the account of the Government.
The former Minister of Commerce and Industry, Miata Beysolow, the GAC also recommended, should be censured by the President of Liberia for not monitoring the deal to ensure that the terms and conditions were enforced by LPRC.
The former Commerce Ministershould be censured by the President of Liberia for awarding a deep discount of US$4,584,292.90 to Aminata& Sons without any basis, said the GAC recommendations which were contained in a report submitted to the Legislature for perusal and prompt action.