REVEALED: Miller's role in BPL deals

Leslie Miller

As of Wednesday, November 8, 2017

AN EMAIL exchange between Kevin Basden and Donna Smith discussing Leslie Miller’s attempt to give work to Row Creek.

By TANEKA THOMPSON

Tribune News Editor

tmthompson@tribunemedia

THE Ernst & Young (EY) audit into operations at Bahamas Power & Light (BPL) has identified instances where former Executive Chairman Leslie Miller allegedly “influenced procurement decisions” for the awarding of contracts “or circumvented the process entirely,” The Tribune can reveal.

According to a copy of the audit obtained by this newspaper, EY found alleged actions taken by Mr Miller regarding the issuance of contracts worth less than $100,000 – below the limit of board/chairman involvement – at the government entity were “highly irregular”.

The audit also flagged numerous “irregularities” in the way contracts were awarded by the former Bahamas Electricity Corporation (BEC) since 2012, including lack of due diligence leading contracts being awarded to companies “owned by public officials or BEC board members”.

The audit also revealed one company said to be owned by the brother of Progressive Liberal Party (PLP) Leader Philip “Brave” Davis received lucrative contracts from BEC even though the business was not the preferred bidder in a tender process.

The company, AL D’s Construction & Roofing, received two contracts for a higher value than the recommended bidder. Despite repeated calls, Mr Davis could not be reached for comment yesterday.

The audit found while two BEC executives wanted to award these contracts to two different companies, Mr Miller wrote to the officials directing them that BEC’s board had requested the contracts be given to AL D’s Construction & Roofing instead.

Investigators also found a company owned by Mr Miller – Mario’s Bowling and Entertainment Palace – received $52,192 from the utility provider since 2012.

When questioned about the audit’s findings yesterday, Mr Miller pushed back on the report saying “every contract” awarded by BEC’s board was given to the lowest bidder. He denied engaging in any irregular practices insisting he led a “top notch” team at BEC and saved the government millions of dollars in overtime pay and other expenses during his brief tenure.

He also denied that Mario’s Bowling had any contract with BEC/BPL. He claimed to be unaware of any contract being given to a relative of Mr Davis.

Politically exposed persons

EY said it found “weaknesses in the vendor due diligence process” and 19 vendors for whom the required due diligence was not performed.

“The requirements for vendor due diligence are not documented in the current procurement policy. From our review of vendor files, we confirmed that there is no requirement for procurement staff to confirm if vendors are politically exposed persons (PEPs) or owned by public officials, have criminal backgrounds, previous negative press coverage or relationships to staff and/or directors of BEC.”

EY found that for 19 out of 35 vendors selected for testing, “no due diligence documentation could be obtained.”

The report added: “No information on ownership could be obtained for these workers, along with no confirmation of valid business licence and or tax registration.”

EY identified three vendors owned by PEPs or public officials who had contracts with BEC/BPL.

It has been previously reported that Bahamas Couriers Limited trading as Bahamas Cargo & Logistics, owned by the father of former Minister of Education Jerome Fitzgerald, and Penta Industrial Services owned by Errington “Minky” Isaacs, PLP chairman emeritus, received contracts with BEC.

However, the contract given to a relative of Mr Davis is a new element to the controversy.

Of this company, EY noted: “Two contracts were awarded to this vendor for a higher value than the recommended bidder. Supporting documentation in connection with these transactions include internal memorandums from Kevin Basden and Lana Mingo requesting Mr Miller’s approval to award the contracts to DN Construction Co and Dudley Smith Construction Company. A handwritten response from Mr Miller is included on the memorandums stating that the board requested for the contracts be awarded to AL D’s Construction & Roofing.”

EY said for one of the contracts, the recommended bidder price was $118,816 but the contract was awarded to AL D’s Construction for $199,000. The investigators also found that for the second contract, the recommended price was $36,400 but was awarded to AL D’s for $41,417.

“There was also another company lower than AL D’s Construction & Roofing at $40,260,” EY noted.

Two vendors who got contracts under $100,000 were identified as being owned by former BEC board members: Nassau Salvage Company, said to be partially owned (11.1 per cent) by Edward Darville, and Mario’s Bowling & Family Entertainment, owned by Mr Miller. The report noted the total spend with Mario’s Bowling by BEC since 2012 was $52,192. Nassau Salvage had a contract worth $22,168, according to the audit.

Former PLP Senator Greg Burrows, owner of The Cleaning Company, received a cleaning contract for $65,200 which was quickly revoked due to poor performance.

“Based on interviews and corporate documentation reviewed, this vendor is owned by former Senator Greg Burrows,” EY noted. “It was alleged that Mr Burrows used players from his baseball academy to perform the cleaning services. The contract was terminated shortly after being awarded due to poor performance.”

Another company, Tinker Enterprises Ltd, was said to have been paid $82,500 by BEC.

“Based on online research, the owner, Kirklin Tinker, was a former business partner of Leslie Miller in Sunburst Paint,” EY noted.

However Mr Miller claimed to The Tribune when Tinker Enterprises was engaged by BEC, Mr Tinker, now said to be deceased, was no longer involved with the company.

Tender process

The audit also outlines several instances when the tender process at BEC was not followed, noting EY identified three contracts with a value in excess of $100,000 for which no formal tender had been performed.

One such case involved a company called Sure Tech CCTV Surveillance which had a contract valued $157,750. According to EY, this business was one of five identified as not being a registered company.

“Four quotations had been obtained but the contract was not put to tender. Quotations were obtained and analysed by the ‘end user’ and not a member of the procurement function. The selected vendor ultimately failed to complete the project and legal action was taken by BEC against the vendor for breach of contract.”

Atcun Security had a contract valued at $870,684, however there was a total vendor spend since 2012 of $3,685,257.

In the case of this company, EY noted: “A memorandum from the chairman to the general manager stated that two other quotations had been requested but no documented evidence of the alternative quotations could be obtained. The contract was not put to tender and the procurement function was not involved. Further, we observed evidence of the former Executive Chairman Leslie Miller authorising a mobilisation payment to this vendor at the inception of their contract. Based on interviews, a mobilisation payment for security services is highly irregular.”

Row Creek Company Ltd had a contract valued $114,036 however total vendor spend since 2012 was $452,161.

“The contract for the supply of furniture was not put to tender and the procurement function was not involved. As noted above, no other quotations were obtained and a purchase order was not created,” EY found.

The firm also identified nine instances where vendors were engaged “with no evidence of procurement analysis or other quotations being obtained.”

E&Y added: “For the following vendors, we found no evidence of any other quotations being obtained prior to award of contract or issue of purchase offer.”

In the case of Atcun Security, the investigators found the company was paid 30 per cent more for security services during a one-year period than the firm which was previously providing BPL with the same services.

Penta Industrial Services received $4,592,041 from BEC, however EY said it was unable to identify any competing bids or alternative quotes being obtained for these services.

“Further we observed evidence of the former Executive Chairman Leslie Miller authorising a mobilsation payment to this vendor at the inception of their contract. Based on interviews, a mobilisation payment for cleaning services is highly irregular,” the audit noted.

On November 7, 2012, Mr Miller instructed Mr Basden to “please prepare a cheque for the amount of $40,000 relative to this request,” referring to the cleaning services contract awarded to Penta, the audit notes.

Referring to Row Creek, the auditors found that in addition to not observing competitive bids related to the four contracts awarded to this vendor, EY observed the following irregularities: “An invoice was sent on the same date as quotation for the work. Both documents were addressed to the chairman not the end user.”

It was also noted: “One specific quote has an email ‘approval’ from the chairman even though it is below the limit required for board/chairman involvement.”

Concern

EY said it found electronic evidence that former executives and board members had concerns about “the manner in which Mr Miller was engaging” with the vendor in question.

An internal memo from Mr Basden to Mr Miller on March 10, 2015 noted issues with a batch of eight invoices from Row Creek which were sent to the former’s office in February of that year.

Mr Basden noted the invoices total $330,000; there was no tender/competitive bidding process; and the recent work carried out by Row Creek “raised concerns from a workmanship perspective.”

On February 24, 2015 Mr Basden sent an email to BEC official Donna Smith which expressed concern about Mr Miller’s intent to give the company lucrative work.

Mr Basden wrote: “The chairman is now attempting to give Row Creek, the company that tiled downstairs, some $330,000 of additional work – tiling of various other areas in the building, painting of the exterior of the building and boundary walls, and painting of public areas in the building. A copy of the various invoices, some of which were reportedly signed on different dates - Feb 3, 2015; Feb 6, 2015; Feb 8, 2015 and Feb 14, 2015 - but submitted to my office today, even though it was dated Feb 20, 2015 by the chairman, are attached.”

Ms Smith wrote back: “This cannot happen. We need to discuss how best to deal with this.”

EY found more issues with Mr Miller’s involvement in operational procurement activity at BEC.

“We identified numerous instances where the chairman was actively involved in low value procurement activity,” EY wrote. “We noted five instances were correspondence form the vendor (invoices, bids, proposals) was addressed directly to the chairman and not the procurement or engineering functions.

“We noted nine instances where handwritten approval was provided by the chairman for amounts below $250,000. We noted 10 instances of written correspondence from the chairman to staff instructing them to engage with or process payments to a given vendor.”

In its executive summary, the audit noted: “EY identified numerous irregularities in the manner in which contracts were awarded by BEC since 2012 including numerous instances where the tender process was not followed; instances where contracts were awarded to vendors who were not selected or did not participate in the tender process; lack of vendor due diligence leading to contracts being awarded to entities owned by public officials or BEC board members; instances where the former Executive Chairman Leslie Miller influenced procurement decisions or circumvented the process entirely and gaps in basic procurement controls.”

proudloudandfnm 6 years, 5 months ago

And Brave as the leader reflects change????

I swear. There will never be a time when the PLP is not completely corrupt.

They are traitors...

BahamasForBahamians 6 years, 5 months ago

lol Classic Tribune and FNM politics.

Hubert says he want a raise and the political egg is on his face. The tribune responds with damage control and distractions with more discrediting of the opposition by releasing details of an audit that should've been released months ago.

PUBLIC SERVICE ANNOUNCEMENT TO FNMS (esp to the journalist and proud and loud poster above)

The entire country knows the PLP was doing sh*t. We dont want to hear about that for the next 5 years.

Is this your plan to govern the country ?

Releasing details wont create jobs. We are WELL aware of the details, thats why we voted the PLP OUT!

Not to continuously hear about them! . We already know what the PLP was doing - Its jobs, food to eat, security from crime, etc, those are things we cant find and that are uncommon to us. The ability to provide those things is what is becoming strange to us and thats what the administration needs to be elaborating on!

ohdrap4 6 years, 5 months ago

well you were right there at the convention and could have done a mea culpa, that way the media stories could stop.

realfreethinker 6 years, 5 months ago

Nothing those miscreants did surprises me anymore. The plp is just plain corrupt. I don't know where you all expect the gov to find the money,when your corrupt boys and girl either stole it or just gave it to family,friends and lovers. You could squirm as much as you want or call it a distraction,but the shit has to come out. THIEVES

Clamshell 6 years, 5 months ago

Sorry, I disagree ... the best way to kill mold is to keep shedding light on it.

SP 6 years, 5 months ago

A little bleach help kill` mold too. I doubt if there's enough bleach in the region to help the PLP though.

ohdrap4 6 years, 5 months ago

ALL FOR ME, BAABEEE!!!

Porcupine 6 years, 5 months ago

Surprise. F_ _ king Surprise.

Well_mudda_take_sic 6 years, 5 months ago

There isn't a damn thing here that all of us did not already know or expect to learn, and it's the reason why the FNM won the last election with such an overwhelming anti-PLP vote. But all of these very costly investigations are nothing but politicking optics on the part of the Minnis-led administration at the taxpayers expense! Mark my words, no one connected to any of these contracts and the last PLP administration is going to end up facing serious criminal charges that result in hard time being spent behind bars. Carl Bethel and the Director of Public Prosecutions have already decided all of the exposed corruption under the last Christie-led government should be regarded as nothing but mere political fodder that Minnis can use to score cheap political points at the expense of true justice being served for the people.

Reality_Check 6 years, 5 months ago

Many of the internal control weaknesses and irregularities in BEC/BPL's procurement and purchasing functions have for many years been reported annually to BEC/BPL's board of directors by the external auditors of the company's annual financial statements. All of this nonsense cuts across both the Ingraham and Christie led administrations and we must not forget that Minnis would have had access to information and rumblings about the shenanigans going on at BEC while he was a cabinet minister under the last Ingraham-led administration. So you're probably right Mudda. Nothing happened to bring the miscreants to justice in years gone by and nothing will happen as a result of these latest revelations. Par for the course....and to think Minnis promised it would be "the people's time." It's certainly looking more and more like dirty politics as usual rather than a serious intent and effort to bring the perpetrators and beneficiaries of corruption to justice.

Well_mudda_take_sic 6 years, 5 months ago

What's truly sad about all of this is Minnis's obvious propensity to think along the lines of "they get theirs, so we should get ours". We have already seen this line of thinking from him when he recently arrogantly announced on the floor of the HOA, while revealing the outrageously lucrative so called "consulting contracts" enjoyed by Baltron Bethel and others, that he would be seeking a hefty pay increase for all parliamentarians. It was as if Minnis was stating in no uncertain terms: "Why should they get theirs, and we not get ours?" It certainly would seem political power has gone to Minnis's head in the worst possible way. I suppose he reckons that he is now among the entitled political elite.

Clamshell 6 years, 5 months ago

A fascinating tale of thievery, incompetence ... and more thievery.

John 6 years, 5 months ago

Wednesday’s are slow news days and today was especially slow. Look at the size of the main section. Then HEY, LOOK! There’s a possible $4.5 BILLION investment for Freeport! Isn’t this exciting?

DDK 6 years, 5 months ago

If legal steps cannot be taken to penalize Miller or others who benefitted from unvetted contracts and related unethical behaviour, what it the point of this expensive exercise? How will it help recover the misappropriated public funds? The majority of the electorate have short memories and will look more favourably on this Government if reliable, reasonably priced power service is provided from here on in. I, for one, have seen no improvements on this score.

jackbnimble 6 years, 5 months ago

Yeah. I don't get the continued naming and shaming. It doesn't get us one dollar of what they have stolen back especially if they cannot or will not be prosecuted for it. Better to just pass the Freedom of Information Act and all those other transparency laws that were promised. Otherwise it will just be more of the same - present crooks included.

OMG 6 years, 5 months ago

Whist agreeing that the present government should not dwell day in and day out about the PLP mismanagement it is necessary to expose the names and crooked deals so that we can keep the public in the picture when people like BRAVE DAVIES, LESLIE MILLER, and FWEDDIE spout their nonsense.

DDK 6 years, 5 months ago

You have a good point!

John 6 years, 5 months ago

For the first time ever I cautiously say I may have to agree with Brave Davis. And to venture to say if Hubert Minnis and his newly appointed FNM government does not stop spending so much time among the skeletons of the past PLP government and get to governing this country then he may as well dig two political graves and not just one. Too many people are hurting, too many businesses are failing, too many additional persons are losing jobs for The Minnis led government to be focused on the PLP’s backside as they have remitted office and continue to fade in the background. Now show the country what you are going to do. Show the Bahamian people what you are capable of. Take a page out of Hubert Ingraham’s book when after being elected in 1992 he said something to the effect that ‘many people are blaming me for wanting to seek revenge on the PLP. But I am the one holding back the tide (of assault)’. So yes it’s time to Move on Minnis and y’all FNMs. Try make sure that even though every Bahamian may not have a job by Christmas or even have their lights on, at least they get to taste a piece of ham or turkey to eat. Political warfare is ongoing. Personal suffering and a stagnant economy doesn’t have to be.

John 6 years, 5 months ago

*should be demit office and not remit

sealice 6 years, 5 months ago

EY also knew when they were hired for this that no matter what they found out about those crooked MFS that nothing would be done because they have the law (unchanged since the evil honky's rule ) on their side....

screwedbahamian 6 years, 5 months ago

If our own Brothers and Sisters in government screw the Bahamian People to such unconscionable levels of thievery, how on the Bahamian soil can we expect foreigners to come here and not screw the Bahamian people to a higher level. From before time this man has been associated to slapping up females to show his Love, and major corruption at every level of life. If he put collection in the plate at Church corruption is involved. Yet he is allowed to repeat these acts over and over again under the disguise of SERVING THE PEOPLE. How and when are we going to stop crime at every level in the Bahamas. It appears that this will only happen if a major Tsunami Wave or a category 15 hurricane hit the Bahamas Islands. People rise up to a better crime free of all levels Bahamasland.

BoopaDoop 6 years, 5 months ago

This man bragged several years ago that he built Mario's Bowling duty-free under the government's Hotel and Restaurant Act.

jackbnimble 6 years, 5 months ago

And borrowed millions from BOB that he never paid back to do it. Well it's clearly a business that's failing. God don't sleep!

John 6 years, 5 months ago

I honestly think it’s time I the racist John become prime minister (for life).

ohdrap4 6 years, 5 months ago

you would too.

however, in due time, there would be no citizens left for you to lord over, cause then women would not be able to have little citizens.

Dawes 6 years, 5 months ago

I am glad this is all coming out, and i hope they do this at all the other quasi Government entities. If any of these actions are illegal then charge the person, if they are not illegal but immoral then change the rules and put the correct controls in place to either stop them or make them illegal next time.Its funny how people complain about this being a waste of money don't realise that if we don't stop the level of corruption we have soon, then taxes will be going up again, and one of the main ways of doing this is find out how the corruption occurs and put in place mechanisms to stop it. One would think that any FNM's thinking about doing stuff will think again, cus if the PLP win they are going to want to do the same to FNM's as has happened to them.

SP 6 years, 5 months ago

Former Executive Chairman Leslie Miller is 100% right about one thing. He led a “top-notch” team of pirates at BEC!

SP 6 years, 5 months ago

Saudi government to confiscate $800 billion from alleged corrupt individuals

http://www.foxnews.com/world/2017/11/...">http://www.foxnews.com/world/2017/11/...

What will the Bahamas government recoup from alleged corrupt individuals and natural resources pirates?

Reality_Check 6 years, 5 months ago

NADDA....we will recoup nadda!!

John 6 years, 5 months ago

This far this Minnis led FNM government has been an ‘en masse’disappointment to the Bahamian people. Besides exposing the corruption and short comings of the former PLP government they have done nothing to ease the hardships of the Bahamian people. This should have been their number One priority. Along with crime. As a student in college more than 4 decades ago the administrators of the college presented short term, intermediate plans and long term goals of the college (now a university). And every time you go to visit the university the administration can tell which goals were achieved, the plans that have bee altered and the new goals and plans they have for the university. Here in the Bahamas we seem to be operating from Election to Election. Whoever gats in power takes the (Bahamas) ship and steers the country in the direction whichever he pleases. And besides drifting into more rough and muddy waters, the country seems to be going round in circles. And with every circle Bahamians seems to be becoming more and more disenfranchised. Not giving up on them yet, but the Minnis led government has been a major disappointment!!!

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