Monrovia – A compliance audit conducted by the General Auditing Commission (GAC) has revealed that the Liberia Revenue Authority (LRA) misappropriated approximately US$6.7 million intended for the Government of Liberia (GOL) from revenues generated under the Destination Inspection Agreement with MedTech Scientific Limited.
The audit, covering the period July 1, 2022, to October 31, 2024, was submitted to the National Legislature and uncovered several disturbing findings, chief among them that the LRA diverted the government’s 20% share of revenue for its own use instead of depositing the funds into the Consolidated Fund Account as required.
The Destination Inspection Agreement was signed on April 21, 2021, by the Government of Liberia, represented by the LRA, the Ministry of Finance and Development Planning, the Ministry of Justice, and other key government agencies.
According to the GAC report, Section 1.0 (2) of the Memorandum of Understanding (MOU) between MedTech Scientific Limited, the Government of Liberia, and Ecobank Liberia Limited required that all fees payable by exporters and importers for services be deposited into a designated transitory account for onward distribution among the parties, with a minimum balance maintained as per the bank’s terms and conditions.
However, during the audit, the GAC observed that the LRA failed to remit US$6,775,954.07—the government’s 20% share—into the Consolidated Fund. Instead, the funds remained in MedTech’s account, and the LRA made direct payment requests to MedTech for disbursements in its favor, in clear violation of the agreement.
In its response, the LRA argued that the Liberia Revenue Code and the Destination Inspection Agreement authorize the collection of customs service fees directly by the LRA for the issuance of customs documents and related services. The LRA further explained that it is awaiting the conclusion of a Supreme Court case involving MedTech, after which discussions would be held to address all “defects and anomalies” in the Destination Inspection Agreement—including the operationalization of the transitory account. Meanwhile, the LRA noted that funds generated under the MedTech contract are now captured in the Fiscal Year 2025 national budget, routed through a government-created transitory account.
Despite the LRA’s justification, the GAC countered that Regulation B.8 (1) of the Public Financial Management (PFM) Act of 2009, as amended in 2019, mandates that all public monies collected by government agencies must be paid in gross into designated bank accounts, with no officer permitted to use such funds prior to deposit unless specifically authorized by law. According to the GAC, LRA Management should have retained custody of the Destination Inspection fees in its designated account and remitted them to the Consolidated Fund, pending any lawful mandate permitting their use.
The GAC further observed that fees generated from the Destination Inspection Agreement were not deposited into the transitory account at Ecobank Liberia from August 2021 to October 2024, as stipulated by the agreement. Additionally, the government’s 20% share remained in MedTech’s account during that period, in violation of the contract. The GAC noted that details of the bank accounts where the funds were domiciled, including statements and other relevant documents, were not made available for audit purposes.
In its defense, the LRA claimed that the contractual fee structure was reversed to the BIVAC fee model on instructions from the government following public outcry by small businesses during the early stages of implementing the Destination Inspection Agreement. This adjustment, the LRA said, made it impractical to use the transitory account as initially intended, since certain fees below a minimum threshold of US$190 were exempt from distribution between MedTech and the LRA.
Nonetheless, the GAC maintained that the agreement clearly required the holistic deposit of all Destination Inspection fees into the transitory account, from where they were to be shared at a ratio of 80% to MedTech and 20% to the Government of Liberia.
The GAC also flagged a lack of sufficient documentation—including payment vouchers, payment requests, purchase orders, receipts, contracts, procurement plans, bid documents, evaluation reports, procurement committee reports, and delivery notes—for expenditures totaling US$1,306,051.27. These expenditures covered transactions processed by both MedTech and the LRA.
In a transmittal letter accompanying the audit report, Auditor General P. Garswa Jackson urged the Honorable Speaker and Members of the House of Representatives, as well as the Honorable President Pro-Tempore and Members of the Liberian Senate, to urgently consider the recommendations contained in the report, given the seriousness of the findings.
