Amandala has come across three shocking special audit documents dating all
the way back to the period 1991-1994, which reveal a string of questionable
municipal contracts totaling $22.3 million, and mostly controlled by a set
of related companies whose front man was well-known businessman Javier
Berbey Garcia, now deceased. Nothing ever came out of the audits, except
Government having to pay more money to settle lawsuits. Neither the audit
report nor the lawsuits were ever made public.

If you think the shocking stories coming out of the Development Finance
Corporation (DFC) Commission of Inquiry are unbelievable, wait until you get
the gist of what's inside these audit reports and the responses we've
received from some of those people we've questioned about them to date.

The three-volume series produced in July, August and November 1994 were
prepared by former UDP Opposition Senator, Arthur Roches, who served as an
internal auditor for the Financial Secretary, doing the work for the Office
of the then UDP Prime Minister, Manuel Esquivel.

The United Democratic Party (UDP) had commissioned the internal
investigation of how the preceding People's United Party (PUP)
administration had been managing the public purse, but notably, the results
of that audit have been secret until recently, with several copies of those
supposedly confidential documents now in circulation.

The documents say that the Ministry of Finance entered into 205
works-related contracts, most of which were signed by the then Minister of
State in the Ministry of Finance, Hon. Ralph Fonseca, for his own electoral
division, Belize Rural Central. A few were signed by the then Chief
Procurement Officer, Hon. Maxwell Samuels, incumbent Belize Rural North area
representative, who, the audit reports say, often bypassed the tender
procedures without the knowledge of key officials in the Ministry of
Finance.

"That other officials in the Government [other than the Minister of Finance]
approved projects, appears illegal, and this may be a matter for the legal
minds to decide bearing in mind that before funds could be made available to
begin and complete projects, the Minister of Finance has to seek approval
from the Legislature once there is no provision for them in the Annual
Estimates," the audit said.

There were nine big contractors and six small ones. The big contractors were
Phoenix Limited, Seramak International, Southern Contractions and
Investments Company, Bella Vista Development Company, K.W. Construction
Company, Indeco Enterprise, Vista Del Mar Development Company, Belize
Aggregates and Metropolitan Development Company. The smaller contractors
were Rudolph Gillett, Carter's Construction Company, Selwyn Gillett, John
Henry, Wilhelm Lopez and Roy Quilter.
In only 38 of the cases were proper tender and competitive bidding
procedures followed and most of the bidding was done by related companies,
with the signature of one person appearing, in one instance, on contracts
awarded to four different companies, said the audit report.

"Waivering [sic] of tender procedure appeared to be the order of the day,
given the frequency at which it was done and by the Minister of State in the
Ministry of Finance," the report said, adding that under the financial
regulations, it is the Minister of Finance alone who has the power to
waive-but only in exceptional circumstances.

Instead of placing projects in the hands of the chief engineer of the
Ministry of Works, they were overseen by an architect that the Minister of
State in the Ministry of Finance contracted - a man identified as Luis
"Blas" Mendez. Roches opines that the supervising task was too monumental
for Mendez, and because of lack of adequate supervision and assessments of
some projects, Government could have been "taken to the cleaners."

But what is also shocking is Roches' claim that when he went to investigate
the works that were supposed to have been done, there was very little
evidence in many cases that Government even got some of the roads, bridges
and culverts, and infrastructural repairs that it had paid for. There was
one case of alleged fraud. Roads were sometimes found to be shorter and
narrower than the contracts made them out to be. In one instance a football
field that Government had paid for, could not be located.

According to the audit, $33,000 was paid on vouchers which stated that the
funds were "for the chairman" of the Gales Point Village Council but the
then chairman, Walter Goff, knew nothing of any money collected on his
behalf. In the case of one $15,000 voucher, a Cornelius Andrewin, said to be
chairman of Gales Point Manatee, was named as the payee by the Government of
Belize when he was, clearly, not even the chairman. Moreover, no such person
was even known in the village. The Andrewin case, said Roches, appears to be
a case of "forgery/fraud."

In one instance, a string of vouchers amounting to 60% of the total bill was
paid out to a contractor even before the contract document was finalized,
and by the time it was paid off totally, the contractor got $20,000 more
than the agreed contract sum.

Today, Esquivel told us that he does remember the audits Roches had
submitted, and that they were still in the hands of the then Solicitor
General, Gian Ghandi, when the UDP left office in 1998.

But when we spoke with Ghandi thereafter, he said that he does not remember
seeing any such audits. The man who was in charge of the Attorney General's
Ministry at the time, now Opposition Leader, Hon. Dean Barrow, told us that
he also does not recall any such audits - that something that important
would have stayed in his memory.

When we asked Esquivel why the issues raised in the audit were never
resolved, he told us that the problem was that many of the contracts were in
court, because the contract holders sued after the UDP government cancelled
their contracts. He recalls the biggest challenge coming from the Berbey
group-meaning Javier Berbey Garcia, who was the main man for a string of
companies, including Belize Aggregates, which was owned 95% by Barry Bowen
and Bowen and Bowen, and 5% by the Government of Belize. Garcia also signed
for Bella Vista Development Company and Vista Del Mar Development Company.
Al Chanona - brother of former Belmopan City Mayor Anthony Chanona - was
also a point man for the Berbey group of companies.

While Barrow told us that he does not recall the Government being sued by
Berbey, Ghandi said he does. When the UDP took office, the first thing they
did was to unilaterally suspend the existing contracts, said Ghandi,
recalling an arbitration over a contract where the arbitrator found in favor
of Berbey.

Roches had submitted his documents to the then Financial Secretary, Jaime
Alpuche, and the then Cabinet Secretary, Henry Gordon.

While we could not get to speak with Alpuche, we did speak with Gordon, who
also recalls the issues raised in the audit, but confirms that nothing ever
came out of them.

He said that he is not sure if anyone in his Government pressed the issue of
the audits; Esquivel told us the same when we asked him the same question.

Gordon is calling what is being unearthed now with the DFC investigation and
the investigation of the Social Security fund, "déjà vu" of what had been
discovered in the 1991-1994 audits during the PUP administration.

"The document was alarming. Five companies kept tendering for practically
every project," Gordon said, describing the phenomenon as "gouging" and
"feeding at the trough."

We asked him why he thought the confidential audits are just coming out now?
He responded that,

"There has been a cascading of documents" revealing the same bottom line.
"It was almost, in my view, the mixing of the cake - what we are seeing
happening now is nothing new. It has been going on for years."


Esquivel told us that the intention behind commissioning the audit was to
see if there was any wrongdoing during the previous People's United Party
(PUP) administration that exited office in June 1993.

Our newspaper has yet to get a satisfactory explanation as to why nothing
ever came out of the 1994 audits-which, the auditor had asserted, supplies
ample indication of financial bleeding of the public purse.

Gordon told us that since these were internal audits, they were never tabled
in the National Assembly.

http://www.amandala.com.bz/index.php?id=5463