Forensic audit conducted by the Internal Audit Bureau at the Ministry of Foreign Affairs into the Department of International Economic Cooperation and Integration (IECI), which manages the Japanese Grant Project to Liberia, has uncovered fraudulent transactions of US$227,140.65 or its equivalent of Liberian Dollars19,079,815.00, involving several officials at the ministry, including Deputy Minister Elias Shoniyin and Project Manager, Augustine Nyanplu, who awarded to themselves exclusive power to singly approve cheques for encashment.
The Internal Audit Bureau arrived at the findings based on audit and review of documents provided by the Department of International Economic Cooperation and Integration and a commercial bank in Monrovia, Afriland First Bank, which show there were no supporting documents to validate transactions between the bank and the IECI for the period June 1, 2014 to July 31, 2015.
“Based on our audit and review of documents provided by the Department of IECI and Afriland Bank, we observed that transactions valued at LD$19,079,815.00, its equivalent in US$ 227,140.65 at the exchange rate of 84, represents net fraud amount during the period, as there were no supporting documents to validate the transactions”, reads the Executive Summary of audit report released by the Internal Audit Bureau, dated August 11, 2015.
The audit revealed that signature specimens prepared to effect withdrawal from the Project accounts at the Afriland First Bank indicates that two of the signatories, in persons of Deputy Minister Elias Shoniyin and Project Manager, Augustine Nyanplu had the exclusive power to singly approve cheques for encashment.
“Deputy Minister Elias Shoniyin informed the auditors that he was not aware of any of the signatories possessing exclusive rights to approve checks singly, as this was never the intent of the Project. However, documents in the position of the auditors showed that Minister Shoniyin was fully aware of the exclusive power of single signatory right to withdraw from the Project Account”, the report disclosed.
It said initially, the GOL-IECI project A/C # 0000108854-01-70 was initially opened with the three (3) signatories affixing their signature as evidence on the signature specimen. The three (3) signatories were Mr. Elias B. Shoniyin, with the power A+A, Mr. Augustine Nyanplu, B+B and Mrs. Elizabeth Johnson Sirleaf as C+A or C+B.
“This action indicated that the both signatories in persons of Mr. Elias B. Shoniyin and Mr. Augustine Nyanplu could withdraw from the project account without the knowledge of signatory C. Therefore, the absolute or overriding power granted to Mr. Elias B. Shoniyin and Mr. Augustine Nyanplu created the basis for a potential fraud. Also, this created doubt or suspicion about the management of the project fund as well as the account.”
The report however noted that a second signatory specimen card arrangement came about as the result of the appointment of Mr. Thomas Kaydor as Deputy Minister for International Economic Cooperation & Integration and Dr. Wede Elliot Brownell as Deputy Minister for Administration, Ministry of Foreign Affairs. Mr. Thomas Kaydor replaced Mr. Elias B. Shoniyin and Dr. Brownell replaced Mrs. Elizabeth Johnson Sirleaf. The arrangement was structured as follow:
• Mr. Thomas Kaydor- A+B, B+C
• Dr. Wede Elliot Brownell B+A, B+C
• Mr. Augustine Nyanplu C+A, C+B,
It added that under this arrangement, no individual signatory could effect withdrawal without the involvement of another signatory to the account. But Prior to the submission of the signatory specimen to the Afriland First Bank for effective action, Mr. Nyanplu who was serving as the project manager, with the powers C+A and C+B, allegedly altered the specimen card with C+C without the knowledge of other signatory to the account.
“This action on the part of Mr. Nyanplu served as a recipe for continuation of the fraud. Also, the Afriland First Bank did not perform due professional care by contacting the two other signatories to the account (Mr. Thomas Kaydor and Dr. Wede Elliot Brownell) to authenticate the additional option of C+C”, the audit discovered.
Furthermore, it said documented evidence provided showed that miss Comfort Y. Mohn a staffer at the Afriland Bank deposited on two separate occasions on behalf of Mr. Augustine Nyanplu, but it is yet to be established on whether or not it’s part of normal banking practice to deposit a certain amount in the name of a customer.
The profolio manager at the bank, Mr. Steven Tokpa, had indicated that issue of such situation occurs wherein customer will give money to the staffer to be deposited in the customer account bearing the name of the staffer as the depositor, but the report observes .that “This action provides a potential risk for fraud.”
According to the report, the Department has no project accountant to periodically monitor, review and institute internal control over the Project funds; and there was no bank reconciliations of the two Project Accounts kept at Afriland Bank.
It also observed lack of segregation of duties of the financial activities of the Project, as all financial activities were conducted by a single individual, the Project Manager. Additionally, signature specimen obtained from the bank indicates that the Project Manager and the former Deputy Minister for Economic Cooperation empowered themselves with exclusive rights to withdraw funds from the accounts with a single signature requirement, which set the basis of a potential fraud.
On the other hand, the report noted that Afriland First Bank did not exercise due diligence in protecting the Project Accounts kept with it. The report backgrounds that in June 2014, the Japanese Government provided a grant valued at US$ 731,422.00(Seven Hundred and Thirty one thousand, four hundred and twenty two United States Dollars) or its equivalent in LD$ 61,439,448 to fund a project titled: “Institutional and Human Resource Support for Efficient Operation” of the Department of International Economic Cooperation and Integration (IECI) in response to the bilateral consultations between the Governments of Liberia and Japan in 2008.