Monrovia – In February 2018, a scoping report delving into allegations of the disappearance of new Liberian Dollar banknotes Report and US$25 Million announced as measures by President George Manneh Weah to mop up the excess liquidity of Liberian dollars, prepared for the United States Agency for International Development by Kroll Associates, Inc, recommended a full-scale forensic audit of disbursements from the Central Bank of Liberia for the period January 2016 to December 2018.
Rodney D. Sieh, [email protected]
Months later, the Liberian government is yet to sanction that forensic probe. Instead settling for a General Auditing Commission’s Report of Factual Findings in the application on an Agreed-Upon Procedures of the US$25Million Mop-Up Exercise Conducted by the Central Bank of Liberia (CBL) as Mandated by the Technical Economic Management Team (TEMT).
Agreed-up Procedure Trumps Forensic
“A US$100 million investigation will not likely make the issue go away. People’s minds are made up on either side. It’s looking like an attempt at a cover up rather than a search of unquestionable truth. Agreed upon procedure was just a farce.”
Mr. John S. Morlu, Former Auditor General, RL
An agreed-upon procedure is a standard a company or client outlines when it hires an external party to perform an audit on a specific test or business process. The procedures, which are called audit standards, are designed and agreed upon by the entity conducting the audit, as well as any appropriate third parties.
Experts say Auditor Generals do not do “agreed upon procedures” except when an outsider like USAID pay for them to do a work and both agreed on the procedures to be followed.
Such procedures restrict auditors to what they are told or agreed to do. In the case of Kroll, it was agreed upon procedure because USAID paid Kroll and told Kroll the scope of what it wanted to be done.
This was made clear when Auditor General Yusador Gaye, in her communication to the Attorney General Frank Musah Dean made note of an Engagement Letter of March 22, 2019 in which it was agreed that the GAC would perform an Agreed-Upon Procedures (AUP) in relation to the US$ 25 Million Mop-up Exercise.
The GAC’s Agreed-upon-procedure concluded that Central Bank of Liberia Governor Nathaniel Patray failed to utilize his authority and functional independence regarding the exercise surrounding the disbursement of the controversial US$25 million.
With no definite timeline for the LACC’s completion, the saga of the US$25 million faces yet another round of uncertainty even as donors, international stakeholders and probe-weary Liberian hold their breath for a foregone conclusion to a mystery of intrigue.
Governor Patray, according to the findings, indicated to the GAC through a documented review questionnaire that the Mop-Up Exercise was authorized by The Economic Management Team. However, the Chairman of TEMT, Finance and Economic Planning Minister Samuel D. Tweah indicated to the GAC that the TEMT did not issue the CBL a written instruction for the Mop-UP Exercise; rather, the Mop-UP Strategy was authorized by TEMT. Minister Tweah indicated in his documented interview questionnaire that TEMT authorized the CBL to re-infuse the Mopped-Up Liberian Dollars into the market through the commercial banks. The TEMT and the CBL did not provide evidence of the authorization to re-infuse the mopped-up Liberian dollars into the economy as per the MOU.
Minister Tweah had earlier told state radio, LBS that the first US$15 million of the US$25 million were dished out to money changers in various communities such as West Point and New Kru Town although no concrete records were provided to the public as to who actually received the millions, which were not channeled through the banking system. The minister’s US$15 million randomly dished out later turned to over US$17 million in President Weah’s State of the Nation Address in late January this year.
Both Kroll and the Presidential Investigation Technical Team (PITT) recommended forensic audits.
Kroll recommended: “Kroll was unable to reconcile the total value of disbursements for the period January 2016 to December 2018 with the total value of legacy and new banknotes disbursed for the corresponding period. Kroll recommends that a full forensic audit of disbursements from the CBL for the period January 2016 to December 2018 is undertaken, which should include an exercise to verify, that disbursements from the CBL have actually been received in full by the stated recipients (using a risk-based approach).”
MOJ Instructs LACC to Audit
On Tuesday, the Weah-led government through Attorney General Frank Musah Dean commissioned the Liberia Anti-Corruption Commission (LACC) to commence yet another investigation into the US$25 million mop up exercise.
That communication in possession of FrontPageAfrica to Mr. Charles Gibson, acting head of the LACC, reads:
Dear Hon. Gibson,
We present compliments and herewith submit to you, for a full scale investigation, matters and issues emanating from the General Auditing Commission’s (GAC) Audit Report dated May 2019, entitled “On Applying the Agreed Upon Procedures of the US$25M Mop-up Exercise conducted by the Central Bank of Liberia(CBL) as mandated by the Technical Economic Management TEMT).
Considering the sensitivity of matters and issues associated with the said audit report, the Ministry of Justice (MOJ) requests that you conduct this investigation in the shortest possible time.
The MOJ assures you of its continued collaboration as the LACC proceeds with the matter
In a separate communication to Mr. Nathaniel Patray, Governor of the Central Bank of Liberia, the
Attorney General wrote:
Dear Hon Patray,
We present our compliments and by copy of the attached letter, wish to inform you that the Liberia Anti-Corruption Commission(LACC) has been requested to conduct a full scale investigation into matter and issues emanating from the Audit Report entitled: “On Applying the Agreed Upon Procedures of the US$25M Mop-up Exercise Conducted by the Central Bank of Liberia(CBL) as mandated by the Technical Economic Management Team(TEMT).
Considering the sensitivity of matters and issues growing out of the Audit Report, the Ministry of Justice (MOJ)has requested the LACC to conduct the investigation in the shortest possible time.
This letter comes to request that the CBL cooperates with the Investigation. Please do not hesitate to contact us if need be.
The latest order for an investigation into the mop-up money comes as Liberians under the banner of the Council of Patriots (COP) gear up for a much-anticipate gathering aimed at presenting a list of demands to President Weah, including the accountability of the missing LD16 billion and the $US25 million.
COP Rejects AG Dean’s Framing
“Herein lies the circular logic/thinking. The CBL is part of the TEMT; CBL is supposed to be independent; LACC was part of PIT, appointed by the government; PITT including LACC and Kroll called for further investigations; President asked GAC to investigate; MoJ mandates GAC to conduct “AUP.”; GAC says it could have reached a different decision if not AUP; GAC supposed to be independent; MoF and TEMT say they authorized CBL; CBL says it was mandated; MoJ asked PIT member LACC to investigate mandate v authorize.”
Mr. John S. Morlu, Former Auditor General, RL
On Tuesday, COP in a statement, reacting to the Attorney General’s conclusions on the GAC audit, categorically rejected what it described as Dean’s framing of the GAC Report and considers his action as a clever attempt to shield and protect top level cronies of the Government. “The huge variances and discrepancies cited in the GAC Report, which amount in some instances to over L$900 billion Liberian dollars or over US$6 million as well as the many suspicious observations including the transactions with bogus and/or unregistered Forex bureaus and businesses, can in no way support Minister Dean’s definitive conclusion that “no money is missing”.
The COP recalled that after investigating the printing and importation of the L$16 billion dollar banknotes, the Government of Liberia came to a similar conclusion that “no money is missing” but that there were variances and discrepancies which occasioned the arrest, on the very day of the release of the report, of CBL Deputy Governor Charles Sirleaf and Director of Banking Dorbor Hagba. Former CBL Governor Milton Weeks and two others were later arrested and incarcerated and the five former and current CBL officials are presently undergoing prosecution.
Said COP: “Unfortunately, and in a classic display of double standard, the Government has yet to effect any arrest in spite of the fact that the Kroll, PIT, and now the GAC reports on the US$25 Million Mop-Up Exercise all point to huge unexplained variances and discrepancies as well as acts of commission and omission, for which officials and individuals should be held liable and culpable. Minister Dean’s frail reaction to the grievous and criminal acts committed in the design and implementation of the mop-up exercise is a source of serious concern. It is also troubling and suspicious that the nation would have to wait for days to hear from the President of Liberia on what specifically the Government intends to do in response to the three reports on the Mop-Up Exercise when the very Government did not wait for a Presidential Address to take actions on those the Government alleged had acted wrongly in the printing and importation of the L$16 billion dollar.”
The Solution, according to Mr. Morlu, is to allow the CBL to become independent and remove itself from TEMT and let the GAC become independent and do its investigation as it sees fit. “It’s that simple. Both GAC and CBL allowed themselves to be compromised and that’s the main problem. Good governance.”
While Kroll reported massive discrepancies in relation to the USD “Mop-Up” Exercise in July 2018, Attorney General Dean, during a news conference last week stated that the GAC report had concluded that no money was missing.
Ironically, Kroll’s open-source research showed that President Weah mandated an Economic Management Team chaired by the Honorable Samuel Tweah, the Minister of Finance and Development Planning, and the CBL to implement the USD Mop-Up Exercise. “The CBL advised Kroll that the USD Mop-Up Exercise involved CBL Banking Department representatives undertaking the physical purchase of LRD banknotes from local businesses and foreign exchange bureaus, with the seller being reimbursed for the value of purchased LRD banknotes with new USD banknotes. Kroll was not provided with documentation setting out how the USD Mop-Up Exercise was structured or implemented, or which organizations were targeted by the CBL.”
Diplomat: ‘Lingering Quest for ‘Unquestionable Truth’
Kroll reported that it reviewed documentation that showed an order was placed on July 10, 2018 to draw down funds totaling USD 20.0 million from the CBL’s Federal Reserve Bank of New York account to fund the USD Mop-Up Exercise. The date of the order (July 10, 2018) was made several days in advance of the Board of Governors decree (July 16, 2018). Kroll however reported that it is not clear if the draw down was made earlier than approval was provided for the USD Mop-Up Exercise.
Said Kroll: “Kroll’s analysis of information provided by the CBL identified that LRD banknotes totaling LRD 2.3 billion (USD 15.0 million) were purchased for the USD Mop-Up Exercise between July 2018 and October 2018. Kroll was informed by the CBL that the remaining USD 5.0 million was put into circulation as part of normal banking operations, and not retained for continuance of the USD Mop-Up Exercise.”
On Tuesday, former Auditor General John S. Morlu told FrontPageAfrica that the MOJ’s letter to LAC has raises some serious issues.
Mandated v. Authorized? Ex-AG Morlu Weighs in
“The MoJ puts in quote – “on applying thr Agreed Upon Procedures of the US$25m mop-up exercise conducted by the Central Bank of Liberia as MANDATED by the Technical Economic Management Team (TEMT)” – meaning it’s not MOJ’s own words. So, the government is spending money again to investigate the difference between.”
Added Mr. Morlu: “Herein lies the circular logic/thinking. The CBL is part of the TEMT; CBL is supposed to be independent; LACC was part of PIT, appointed by the government; PITT including LACC and Kroll called for further investigations; President asked GAC to investigate; MoJ mandates GAC to conduct “AUP.”; GAC says it could have reached a different decision if not AUP; GAC supposed to be independent; MoF and TEMT say they authorized CBL; CBL says it was mandated; MoJ asked PIT member LACC to investigate mandate v. authorize.”
The Solution, according to Mr. Morlu, is to allow the CBL to become independent and remove itself from TEMT and let the GAC become independent and do its investigation as it sees fit. “It’s that simple. Both GAC and CBL allowed themselves to be compromised and that’s the main problem. Good governance.”
With no definite timeline for the LACC’s completion, the saga of the US$25 million faces yet another round of uncertainty even as donors, international stakeholders and probe-weary Liberian hold their breath for a foregone conclusion to a mystery of intrigue. As the former Auditor General Morlu lamented Tuesday: “A US$100 million investigation will not likely make the issue go away. People’s minds are made up on either side. It’s looking like an attempt at a cover up rather than a search of unquestionable truth. Agreed upon procedure was just a farce.”