MONROVIA – Mr. Dorbor Jallah, the Commissioner General of the Liberia Revenue Authority (LRA) who is poised to assume office on March 1 has told FrontPageAfrica that he would review the conditions under which the contract for production of excise duty stamps was awarded to an Indian company which a FrontPageAfrica investigation previously found to have an internationally corrupt reputation.
By Lennart Dodoo, [email protected]
“Upon taking over, we will review the award process and whether due diligence was conducted,” Mr. Jallah said.
Commissioner General Jallah’s committed to review the contract when FrontPageAfrica brought to his attention the litany of corruption allegations the company producing the excise stamps.
The excise tax stamp is a specially designed stamp with digital and other security features. The main purpose of excise tax stamps is to provide a physical means of collecting tax. The stamps denote that a payment has been made – or is due to be made – to the LRA with regard to a particular excisable item, such as a pack of cigarettes or a bottle of alcohol. This means, every tobacco product or bottle of alcohol products imported or manufactured in the country would have to bear the excise.
A FrontPageAfrica investigation in 2021 revealed that Madras Security Printers Inc., the company that was awarded the contract by the LRA, has a history of scandals in several countries Kenya, Sudan, India and Bangladesh, among others.
During the launch of the stamp in 2021, the former Commissioner General of the LRA, Thomas Doe Nah (now late), described the launch of the excise tax stamp as a major milestone geared toward expanding the tax net and increasing revenue collection, however, critics remained unsure amid concerns that the stamp was masked in secrecy and lacking transparency.
Madras Security Printers competed with the likes of De La Rue (the company printing the stamps for the Ghana Revenue Authority), but according to the LRA, Madras offered the best prices during the bid.
Madras’ Corrupt Track Record
A FrontPageAfrica background check of the Madras Security Printers revealed that the company has a bad track record in various countries it has operated providing similar service.
In 2018, Madras was accused by the Kenyan government of colluding in a scam with several co-conspirators to provide fake tax stamps, despite being the legitimate suppliers of the actual stamps. As a result, counterfeit items such as fertilizer, sugar, and other products passed into the hands of unsuspecting consumers bearing the fake stamps, leading to illness and even death in some cases. Subsequently, Madras directors in Kenya were charged with conspiracy to defraud, breach of trust, abuse of office, and cheating. All directors absconded and refused to appear to face the charges. The Kenyan government issued a press release stating that international warrants of arrest, via Interpol Red Notices, had to be issued.
In South Sudan, Madras Security Printers was accused of corrupt and collusive behavior in 2020 regarding their tax stamp program. The company was alleged to have embezzled millions of dollars in a scheme that bankrupted the program, which was supported by a loan from the African Development Bank of East Africa. The company was suspended and blacklisted in India – its country of origin – due to violations related to a national ID card program in which they were the legitimate supplier.
There are numerous public accounts of illegal conduct by the company in this program, including the sale of personal data.
Mauritius withdrew its accreditation of Madras as a supplier of secure technologies for its banks, while at the same time, there were a number of allegations in other countries, including Bangladesh and Sri Lanka, where Madras had failed to fulfill its contractual obligations or provide the agreed-upon supplies of tax stamps, licenses, or other products.
LRA’s Stand
When FrontPageAfrica alerted the then Commissioner General of the LRA at the time to the multitude of disturbing media reports regarding Madras and their history of corruption, Mr. Thomas Doe Nah replied, “They are fulfilling our contract, and we are not engaged in any corrupt practices with them.”
However, an anti-corruption advocate who spoke to FrontPageAfrica on condition of anonymity criticized the administrative oversight of conducting business with a company known for its corrupt track record.
80/20 Vs. Extra Charge
FrontPageAfrica investigation at the time established that Madras planned to sell a bundle of a thousand stickers for US$25, a price deemed by some as exorbitant. Under this agreement, Madras was set to retain 80% of the generated revenue, while the Government of Liberia received the remaining 20%.
The former Commissioner General Doe Nah, when reached for comment at the time, expressed that the 80% – 20% revenue sharing arrangement was considered optimal for Liberia. He noted that in comparison, other jurisdictions often allowed the company producing the stickers to keep 100% of the sales revenue.
Further clarifying the revenue distribution, Deputy Commissioner Robert Kamei also explained to FrontPageAfrica that the Government of Liberia isn’t dividing the sales revenue with Madras in an 80-20 split, as indicated. He clarified that while Madras sells the stickers to the Liberia Revenue Authority (LRA) at US$23.53 per thousand stickers, the LRA subsequently sells them at US$25 per thousand, with the additional US$1.47 covering operational expenses.
Commissioner Kamei elaborated that the extra amount tagged onto the stickers aims to cover LRA’s operational costs. He added that the LRA engaged with the Public Procurement Concession Commission (PPCC) to request a slight increase in price to support operational needs, ensuring efficient revenue collection for the government.
