Liberia: Govt Begins Hunt for Alleged Culprits of Bilions of Local Currency Misappropriation

The Central Bank of Liberia building.

Monrovia — Mr. Charles Sirleaf, Deputy Governor for Operations of the Central Bank of Liberia (CBL) was arrested, cuffed and taken to the Liberia National Headquarters Thursday evening where he is believed to have spent the night.

Mr. Sirleaf, son of former President Ellen Johnson Sirleaf was picked up from the Central Bank amid tight security just after a board meeting which he was part of, FrontPageAfrica gathered.

He was arrested along with Mr. Dorbor Hagba, Director of Banking.

FrontPageAfrica further gathered that police barricaded the home of former Governor Milton Weeks Thursday evening, but his private security guards refused to let them into the compound.

There was no information on his arrest up to press time.

Journalists and sympathizers were ordered to keep a distance both at the home of Mr. Weeks and the Police headquarters where Mr. Sirleaf was held.

Their arrests come in the wake of investigative findings that the Central Bank of Liberia under the leadership of Weeks and Sirleaf acted without legal authority by printing over three times the amount of banknotes authorized by the Legislature in May 2016.

The investigative reports - one commissioned by the Liberian government and the other by U.S. government through USAID - were both released on Thursday, February 28, 2019.

Both reports identified several discrepancies and missteps on the part of the Central Bank though there were no evidence to prove that a container full of banknotes went missing from the Free Port of Monrovia or the Central Bank as earlier alleged.

The investigations found that all the new bank notes arrived from a Swedish company, Crane AB, but the Central Bank of Liberia then failed to properly track what was done with them.

When Mr. Sirleaf appeared before the Senate on November 19, 2018 to answer to inquiries about the money, he informed the Senate that the Legislature and former President Ellen Johnson Sirleaf gave authorization for the printing of additional L$10 billion for the replacement of the mutilated legacy banknotes.

Sticky Issues with Contract Dates

Kroll, the company hired by USAID to conduct an independent review of the allegation of missing money, revealed that the CBL entered into a contract with Crane AB on May 6, 2016 to print new banknotes totaling L$ billion eleven days prior to the CBL receiving full Legislature approval to print new banknotes.

In May 2017 the CBL requested that the Legislature approve a second request to print new banknotes totaling L$10 billion.

The Legislature did not grant approval for the CBL to print new banknotes totaling L$10 billion.

However, a letter dated July 19, 2017 from Mildred Sayon, Chief Clerk of the House of Representatives, and Nanborlor Singbeh Sr., Secretary of the Senate, provided an instruction to the CBL to "... replace the legacy notes completely with newly printed banknotes" but with a clear caveat that the CBL provide the Legislature with details of the quantity and denominations of the new banknotes "... prior to the printing" of the new banknotes.

The CBL did not provide the Legislature with details of the quantity and denominations of the new banknotes prior to the printing and shipping of new banknotes.

Notwithstanding the lack of Legislature approval, the CBL proceeded to enter into a contract with Crane AB on June 12, 2017 to print new banknotes totaling L$10 billion four weeks prior to the letter dated July 19, 2017 from the Legislature.

CBL Over-Printed

Kroll's analysis of shipping documentation provided by Crane AB (i.e., those records detailing the physical movement of new banknotes from the point of manufacture in Sweden, to either the Freeport of Liberia or Roberts International Airport in Monrovia) confirmed that the company ultimately printed new banknotes totaling L$15.506 billion this equated to the over-printing of new banknotes totaling L$506 million more than the contractually agreed quantity/value.

The first contract in May 2016 for L$5.0 billion included a clause that permitted a fluctuation in the actual quantity of banknotes delivered of -/+1.5% for each denomination, subject to side letters being mutually agreed between the CBL and Crane AB. The actual overall variance in the quantity of banknotes shipped was 5.11%. No formal side letters were provided by Crane AB or the CBL to show that the over-printing of new banknotes was mutually agreed between the two parties.

The second contract for L$10.0 billion did not have any fluctuation clause. Documentation shows that the CBL did pay for the printing of all new banknotes totaling L$15.506 billion.

The Internal Audit Memorandums of the CBL stated that Crane AB printed and shipped new banknotes totaling L$15.506 billion, yet the appended Crane AB packing lists provided to Kroll by the CBL indicated that Crane AB printed and shipped new banknotes totaling L$17.450 billion, a difference of L$1.944 billion. The issue specifically related to an Internal Audit Memorandum dated December 10, 2017 which stated new banknotes totaling L$1.173 billion were delivered to the CBL, whereas the appended Crane AB packing lists stated new banknotes totaling L$3.117 billion were shipped to the CBL, the same L$1.944 billion difference.

Discrepancies in the intended purpose of new banknotes

The first contract in May 2016 for L$5.0 billion received Legislature approval to address a shortage of Liberian dollar banknotes on the market, and for the new banknotes to be "infused" into the Liberian economy.

As of December 2018, the CBL had circulated all of the new banknotes printed in relation to the first contract (including the over-printed new banknotes), of which L$.759 billion had been injected into the Liberian economy without removing from circulation and destroying the equivalent quantity/value of legacy banknotes.

As of December 2018, the CBL had circulated L$9.302 billion (or 90%) of the new banknotes from the second contract for L$10.0 billion (including the over-printed new banknotes), of which L$6.387 billion had been injected into the Liberian economy without removing from circulation and destroying the equivalent quantity/value of legacy banknotes.

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