Liberia: Suspected Corruption in US$2.5M Project Meant to Benefit Rice Farmers in Ebola-Affected Counties
MONROVIA – The General Auditing Commission (GAC) has recommended that the Liberia Anti-Corruption Commission (LACC) investigates how a single individual received on two separate occasions checks amounting to over half a million United States Dollars from the Ministry of Agriculture under the International Fund for Agriculture Development (IFAD) project.
The GAC’s recommendation comes as a result of an audit conducted on the Economic Recovery of Liberia Rice Farmers in Ebola Affected Counties (ERLRFEAC). The audit covered the period of May 1, 2017 to December 31, 2018.
The Economic Recovery of Liberia Rice Farmers in Ebola Affected Counties project resulted from a US$2.5 million grant agreement signed between the Governments of Liberia, Japan and IFAD in October 2016.
The objective of the project was to complement support provided to Ebola affected communities involved in rice production in five counties. It was also aimed at building sustainable farming practices by improving farmers production through the System of Rice Intensification (SRI), increase the farmers’ income and expand the cycle of rice production and processing in these areas, amongst other objectives.
The project programs were implemented by the Ministry of Agriculture through the IFAD Project Implementation Unit which delegated certain activities to the Community of Hope for Agriculture Project through a memorandum of understanding.
The audit of the project covered financial statements and compliance on procurement of goods, works and service.
The audit team, according to the GAC report, obtained 96 percent of the total amount of US$915,747.21 disbursed for the procurement of goods and services and confirmed whether they followed the provisions of IFAD procurement guidelines, project financing agreement, PIU’s Finance and Administrative Procedure Manual, etc.
Of the total US$915,747.21, the audit captured that US$740,545.97 was disbursed on various goods and services without adequate supporting documentation.
Key among such disbursement is the payment of US$588,800.00 to Africa Food Inc., Global Agro Center and Professional Maintenance Contractors Inc. respectively. However, confirmation with the Liberia Business Registry showed that Africa Food Inc. and Global Agro Contractors registered activities were for mixed farming and Professional Maintenance Contractors registered activities were for landscape care and maintenance services.
According to the report, on October 13, 2017, a payment of US$390,600 was made to Africa Food Inc. for the supply of fertilizers when the company’s scope of operations is mixed farming (growing of crops).
Global Agro Center Inc. whose registered activities is also mixed farming received payment of US$43,200 for the supply of 1,700 pair of rain boots.
Additionally, Professional Maintenance Contractors, Inc. received US$155,000.00 as payment for supply of 31 power tillers when are officially registered to do landscaping.
The auditors’ attention was drawn particularly to the payment of US$545,600 disbursed for the purchase of fertilizers and power tillers were made to two companies, yet collected by the same person – Mr. J. Morris Sackie in one instance representing Africa Food Inc. as the Manager received payment of US$390,000 on October 13, 2017 for the supply of fertilizer when his company was not registered for such purpose.
In another instance, there is a slight, almost unnoticeable alteration of his middle name (Mr. J. Moris Sackie) posing as Administrative Assistant of Professional Maintenance Contractor received payment of US$155,000 for the supply of 31 power tillers. This payment was made on May 10, 2018.
The GAC noted that the collection of checks in the name of suppliers by the same person could lead to collusion and rigging of the procurement process which undermines the achievement of value for money.
The management of the project acknowledged the GAC’s findings but contended that the time interval between the checks issued to the names of two separate entities made it difficult to detect that said payments checks were being received the same individual. The management further registered that Identification Cards from the different entities were submitted at the time of receiving the checks, making it a challenge for staff who issued out the check to have assumed that a single individual received the checks on behalf of the two entities under different job titles.
However, the GAC contended that the PIU Management failed to demonstrate that it exercised due care in the award of the contract and subsequent payment of contractual fees, especially so, when the Liberia Business Registry confirmed that their registered activities are far from the contract given them by the project.
The GAC then recommended that further inquiry be conducted to determine whether was a fraud in the process.
The GAC report revealed that during the period under review, contracts for the construction of rice processing facilities in Foya and Voinjama, Lofa County were awarded to EADCON and ADI Contractors, respectively. Up to the time of audit, payment for contractual services summed up to US$190,025.52 and US$154,425.74, respectively. The projects were set to be completed by October 8, 2018 and November 30, 2018.
However, the verification exercise by the GAC established that the water tower and the rice processing equipment at the Foya rice processing facility are yet to be installed even though 68 percent of the contract value has been paid to the contractor.
The audit team also observed that only substructure work on the warehouse at the Voinjama rice processing facilities appear to be partially completed while the substructure work on the warehouse and the septic tank are yet to begin. There was no work on the observed done on the generator house and the water tower even though 74 percent of the contract value has been paid to the contractor. The rice processing equipment were seen lying outside the uncompleted facility.
However, the project management contended that contracts were not completed due to the raining season.
Not convinced by the explanation given by the management of the project, the GAC noted that their findings vary from the assessment report by the Ministry of Public Works relating to the amount paid and the level of construction completed on both facilities. The GAC recommended an independent evaluation of the construction at the two project sites to be carried out to determine the level of completion in relation to the amounts paid.