Monrovia – Mr. James Kollie, the head of the Liberia Maritime Authority and former Deputy Minister for Fiscal Affairs at the Ministry of Finance and Development Planning says, he was notified for a response regarding allegations contained an audit by the Internal Audit Unit (IAU) of the MFDP.
The IAU recently conducted a financial and operational audit of the Private Sector Development Initiatives (PSDI) which was established in 2014 at MFDP to provide loans to Liberian owned Small and Medium Size Enterprises (SMEs).
The loan was meant to financially strengthen Liberian owned businesses, which were expected to repay, and the repayments would revolve or be disbursed to other Liberian businesses. In so doing, the process would have created jobs and accelerate the participation of Liberian owned businesses in the economy of Liberia.
In a statement Friday, Mr. Kollie declared that he has done nothing wrong and will return to the country shortly as ordered by the President to answer to the allegations.
President Sirleaf, in a brief address to the nation late Thursday, said that while the process is still ongoing, her administration can say with a high degree of confidence that such a scheme set up at the PDSI is clearly a conflict of interest and will be dealt with by the full weight of the law.”
The President then went on to say: “I have ordered the principal administrator of the program during the audit period, Commissioner of Maritime Affairs, Hon. James Kollie to return to Liberia from his official trip to assist in the audit and answer all of the issues associated with it.
The Minister of Finance is to have a full audit report on my desk within two weeks for further action. We remain seized of this matter and will leave no stone unturned in the interest of the nation.”
In his response Friday, Mr. Kollie, who is said to be in Europe on official duty urged to public not to pass judgment without hearing his side of the story.
Below is full text of Mr. Kollie’s response:
My attention is being drawn to an ongoing audit of the Private Sector Development Initiative (PSDI) over which I provided general supervision when I served as Deputy Minister of Finance. I am grateful to the President for affording me the opportunity to respond fully to the claims, assertions and accusations made in the draft audit report.
Although I was the subject of the audit, contrary to best practice, and until only a few days ago, I was never notified or interviewed by the auditors. My first encounter with the auditors was on June 2, a day after the draft report was issued.
Of course, these are challenging political times for our country. As such, it is easier to pass public judgments before we hear all the facts, and or muddle what ought to be important professional engagements with political motivations. I fully understand that this is the country in which we live and these are ongoing consequences of a life in public service.
However, I wish to assure the country and our international partners that I served the Ministry of Finance and Development Planning with dedication and professionalism, and conducted businesses there within the boundaries of the law and acceptable best practices.
As such I intend to cooperate fully, as I have always done, to assist in satisfying this ongoing audit as well as reconfirm my continued commitment to financial probity and high standards of accountability in our country.
Without trying to further prejudice the draft audit report, I want to refrain from addressing specific claims or accusations made in the report at this time, and once again, assure Madam President and the entire country that I will fully cooperate with the audit and ensuing investigations for I am confident that I did nothing wrong.
As requested, I am returning to the country immediately.
Difficult as it may be, I urge all to keep an opened mind as we deal with this draft audit report which was leaked with obvious sinister motives and prejudicial intentions.
In May 2014, MFDP entered into a Memorandum of Understanding with the Liberia Bank for Development and Investment (LBDI) to partner and establish an account (GE Fund) through which the borrowers shall receive loans. Modus Operandi of the MOU, which was signed, by MFDP, MOJ and LBDI outlines as follows:
The review among other things established that there was a memorandum of understanding reached between MFDP and LBDI to coordinately run the loan activities of PSDI, however, customers’ evaluation/vetting was squarely done by MFDP.
“The evaluation/vetting conducted by MFDP/PSDI Desk provided many loopholes for default.
Example, there was no collateral to back the loan, many borrowers used the borrowed funds as start-up for their businesses, while there is no evidence of comprehensive market survey on file. These created a serious impediment for recovery, thereby defeating the Project’s objective for revolving fund.”
The report alleges that Dr. Kollie, signed all of the loan approvals. It was established that twenty-four (24) borrowers who received loans valued US$ 965,400.00 have not paid any amount towards recovery.
The report states: “Moreover, twelve (12) businesses received US$ 545,700.00, but could not be located because; they were not visible at point of address. We inquired from few inhabitants of the communities where the businesses were claimed to be operating, but they too could not confirm the existence of such institutions.
Telephone contacts of the individuals who owned these businesses were permanently switched off. See findings below.
The review revealed that twenty-one (21) borrowers received US$ 1,159,000.00, but they have repaid only US$ 123,125.00. Thereby resulting to a balance outstanding of US$ 1,035,875.00.
The report noted that loans were disbursed to either businesses owned by staffs of MFDP; or businesses with whom they got close connections, and some of those businesses have not paid a cent against their obligation.
“The businesses include LELAH INC (US$ 40,000.00), Pure Life Incorporated (US$ 65,000.00), People’s Water Company Liberia LTD (US$ 65,700.00), South East Water Company (US$ 75,000.00) and Zianab Business Center (US$ 20,000.00).
“Out of forty-six (46) borrowers, only Garson Incorporated, located on 11th street Sinkor paid their full obligation of US$ 150,000.00 plus US$ 10,500.00 interest, amounting to total repayment of US$ 160,500.00. Garson Incorporated account statement revealed that the institution has only US$ 11.00 obligation outstanding.”
