By RASHAD ROLLE
Tribune Staff Reporter
rrolle@tribunemedia.net
AS many as 11 Bahamas Power & Light (BPL) employees allegedly helped facilitate a scheme that defrauded the company of nearly $2m, Ernst & Young (EY) concluded in its audit of BPL.
It’s not clear investigators found all 11 employees to be active participants in the scheme, but at least four of them have been fired from BPL since the investigation’s launch.
The 11 employees facilitated the fraud by recording, printing, signing and vetting fraudulent cheques or invoices, signing cheque registers for fraudulent cheques, creating fictitious vendors, putting their signatures on fictitious invoices and facilitating concealment of the fraud.
During EY’s interview with one of the employees, now fired, the person “became agitated and suggested that ‘Everyone is trying to get money out of BEC.’
“When pressed further,” EY noted, the employee “alluded to politicians and senior executives who are benefiting personally from BPL. She refused to provide further details, however.”
The highly anticipated audit obtained by The Tribune details how an internal investigation which began when an employee discovered an “unusually large invoice” from an “unfamiliar” vendor mushroomed into one that involved the government hiring Ernst & Young, the firing of several BPL employees and an ongoing Royal Bahamas Police Force (RBPF) investigation.
Investigators said they observed no evidence suggesting BPL’s chief financial officer was involved or knew about the fraud scheme. She told investigators BPL has made progress since accepting her position in 2009, saying the “control environment is adequate but could be enhanced”.
EY “identified 41 cheques totaling $1,886,525 made to 13 fictitious vendors and three cheques totaling $126,779 made to legitimate vendors” during its investigation.
“Based on our analysis of the documentation available, the evidence supports that a fraud was carried out by means of collusion between multiple BPL employees and at least one (bank) employee,” the accounting firm alleged.
Investigators found at least three of the employees had fraudulent documents in their work area. Investigators also determined three of the employees knew the primary bank employee allegedly involved.
One of them initially denied knowing the man but later told investigators she tried selling him jewellery and lingerie “from her side business”.
In fact, the employee received an email from the man on March 21, 2017. He requested she “print and forward” his invoices to a manager. That manager is among the 11 people who allegedly helped facilitate the fraudulent scheme. At one point he, in an email EY obtained, received a message from a former high-ranking official of BPL who informed that “he’s holding on to (his Mercedes SL class) for now” and the pair should “discuss cash for the Jet Boat.” The revelation, while not appearing to be directly related to the fraud scheme, paints a picture of people awash in cash.
Among the eyebrow-raising findings, investigators found three of the allegedly fraudulent cheques “were negotiated at the bank on the same day they were printed.”
“This,” the firm said, “suggested that someone within the Accounts Payable Department was able to take cheques that were printed and provide them to someone they were colluding with in order to be negotiated at the bank prior to 3pm when the bank closes.”
EY reviewed time sheets and badge swipe information on the dates the cheques were printed to determine who may have been involved in the scheme. The firm found irregularities relating to two employees.
One of the two employees “did not clock in or out for work” on March 24, 2017, EY said, adding: “However, his badge was observed moving in and out of the AP (Accounts Payable) Department throughout the day. This is highly irregular as it suggests he was in BPL offices but not there for work.”
The same employee, on April 20, 2017, “badged out at 2.34pm and did not badge back in until 3.40pm.” The employee “did not clock in or clock out on this date; he was on vacation.” “This is highly irregular as it suggests he was in BPL offices but not there for work,” EY determined.
The other employee “clocked in to work at 8.42am” on March 30, 2017, but did not clock out. The employee’s “last badge swipe was leaving” the Accounts Payable Department at 11.57am.
“Further, no e-mails were sent” by that employee on that date, suggesting to investigators that the employee “left work at 11.57am and did not return.” The same employee had a fictitious business licence certificate and National Insurance Board registration in his desk for “Scuderia Electrical,” a fictitious vendor. The employee was also found to have had in his work area several fictitious invoices that had been sent to the National Emergency Management Agency (NEMA) involving landscaping services after Hurricane Matthew.
An email from the employee to his brother appears to have the raised suspicion among investigators. The employee wrote to a relative on February 9, 2017: “Bro, tell me what you want to bid on at RBC and my ppl will make sure you win the bid. We pay them for the winning bid.”
The signatures of two employees were found on nine cheques totaling $249,859. But in an interview, the two employees “admitted to vetting only one of the fraudulent cheques” and “disputed vetting the other cheques which appeared to have their signatures.” The women “argued that the signatures appeared to be printed or stamped on the documents due to the consistency and similarity of the signatures”.
Three employees, including two managers whose grid stamps and alleged signatures were found authorising fraudulent invoices and certificates of payment, “denied having signed” the documents, according to EY. The investigators observed that in relation to one of those three employees – a person not listed among the 11 who allegedly helped facilitate the fraud – there was a discrepancy between the grid stamp on fraudulent invoices and the grid stamp impression “collected from his work area or observed on legitimate invoices that he authorised”.
EY found one fired employee who inputted 25 of 44 fraudulent cheques that totaled $1,441,460. The same employee created “six of the 13 fictitious vendors” as part of the scheme.
Comments
bogart 6 years, 5 months ago
NOONE KNEW WHAT WAS GOING ON IN A MULTI MILLION DOLLAR COMPANY PROVIDING A HIGH SECURITY SERVICE LIKE ELECTRICITY TO THE BAHAMAS DESPITE STAFFED BY SELECT GOVT APPOINTED OFFICIALS ON BOARDS AND DESPITE INTERNAL AUDIT CONTROLS IS NONSENSE......... AND THAT FRAUD WAS BEING COMMITTED .......ONLY EXPOSED BY A CHANGE IN GOVT AND OUTSIDE AUDITORS.....?........ IS BEYOND BELIEF AND BANK OFFICIAL IN PRIVATE SECTOR.....Where are the names of all persons involved.????? WHO DID THE INTERNAL AUDITORS REPORT TO.......we are a global financial centre with exceptionally skilled accountants, auditors, bankers .... BANK OF THE BAHAMAS NEXT..!,,
ohdrap4 6 years, 5 months ago
One of them initially denied knowing the man but later told investigators she tried selling him jewellery and lingerie “from her side business”.
Well all the accounting stuff went over my head, despite the serious ness of the report.
But now, that a man is buying lingerie, makes this story much more interesting.
did he try it on at the BPL offices? Is that illegal?
TigerB 6 years, 5 months ago
These are some juicy articles, bring it on!!
bogart 6 years, 5 months ago
AUDITS COST TENS OF THOUSANDS OF DOLLARS..AND THE TAXPAYER WITH EMPTY CUPBOARDS PAYS AND URGENT MONEY NEEDS EVERYWHERE.......
THE PORE BLACK MAN GETS 3 YEARS IN JAIL FOR TIEFING TUNA AND RICE.....AND THE WHITE COLLAR CRIMINAL OR CHARGED PERSONS NOT EVEN NAMED.......???
NAME ALL OF THEM SO THAT THE FELLAS IN FOX HILL CAN SEE HOW THEY LOOK IN LINGERIE...,,,!!!!
ohdrap4 6 years, 5 months ago
no matter what cost, this needs to be done.
it is because audits were not done in the past that scoundrels appear to be outstanding members of society.
Embarass them while they are alive.
TheMadHatter 6 years, 5 months ago
Well muddo. My crystal ball is showing me more audits in our future.
Fewer thieves and more lingerie sounds good to me. I must give PM Minnis credit for this one.
Keep finding the people's money. Great work.
Well_mudda_take_sic 6 years, 5 months ago
All political fodder gathered by Minnis at great cost to Bahamian taxpayers....no big fish will spend any time behinds bars in connection with these various matters. Mark my words.
baldbeardedbahamian 6 years, 5 months ago
the plp at BPL,.......................... He don't know, and couldn't tell................ That the workers. dem were stealing................................... Cooking books and double dealing..................................... But even Mario's got some as well.....................
baldbeardedbahamian 6 years, 5 months ago
Hey Bogart,. which pore (sic) black man got 3 years for stealing tuna and grits? Did I miss the report or are you just being racist???
ohdrap4 6 years, 5 months ago
back in the 1990 there was a man jailed for stealing bread and cheese. they killed him in jail after three days.
and, in the early 2000s someone was jailed for stealing a mop and bleach from a chinese foodstore.
DDK 6 years, 5 months ago
Simply firing thieves is not the same as bringing them to justice.
bogart 6 years, 5 months ago
About 3 weeks ago,Tribune article 13th Oct, 21 year old Wilshire Rahming of McKinney Drive who had pleaded guilty to stealing items valued $3.15 a 1 lb bag of rice and 1 can of tuna( I believe it would be the small can of tuna if you took away the average price of rice)sentenced to 1 year and 2 months. This stuck out as I recalled article and jail time of 1 year and 2 months not 3 years as I mentioned for stealing 1 bag of rice and 1 can of tuna valued $3.15 compared to white Collar crime. Racist...To an outsider non Bahamian we may seem racist as we have high yella, bright, bright bright, conkey Joe, dark males, light complexion smoothe skin, mango skin, light skin, black crab syndrome,paper Bahamian, n word, black, white, peasy head, good hair, etcetc to describe others just depends on the situation. Bahamians understand foreigners dont try using it. Bahamians use these terms and others everyday I cannot ever recall a crime situation with a pore white man whichin if you tell a tru tru Bahamian many will just crack right up at the reference. With this situation it is unfair but it is the law for one tiefing 1 bag of rice and 1 can of tuna valued $3.15 and get sentenced versus the current situation. Too often articlles are about the small pore black (or white man) getting jail time and very few white collar offenders caught and charged with large amounts of money crimes. They well, got fired......OMG....Not fair!
baldbeardedbahamian 6 years, 5 months ago
Hey Bogart, yhx fr yr response. Almost unbelievable but it surely could happen in this we country..
John 6 years, 5 months ago
Whoever leaked the Earnest and Young report in its raw and incomplete form are nothing less than a savage political hoe!
realfreethinker 6 years, 5 months ago
The report is complete John. the tribune just released parts of it
Well_mudda_take_sic 6 years, 5 months ago
It was even duly signed by an official of EY!
TheMadHatter 6 years, 5 months ago
Bogart....excellent reference on the tuna guy getting more than a year in jail. This is why our prisons are so overcrowded and we have to let murderers and rapists out on bail.
Where is the Christian Council response on that story? I guess the kind of fish Jesus fed the multitude with wasn't tuna.
But if they found out he was gay they would have pressed the judge for 5 years.
realfreethinker 6 years, 5 months ago
Why do you people mention that cult.
TheMadHatter 6 years, 5 months ago
Sorry, but have to keep mentioning them because they hold political sway and do nothing except oppose the gay community. They don't care about anything except filling church pews - so teenage pregnancy is not a concern. Abstinence only (which anyone with eyes can see ain't working) is their only approved solution (because they know it isn't a solution).
Struggling families?
Young women unable to complete their education?
Infants and children malnourished, eating Ramen Noodles with weenie?
Lights out?
Water off?
Not their problem. Just be sure to pay your tithes though, so God will "bless you." Remember to "feel blessed" and "Thank God for Life." Don't worry they in Mercedes and you riding bus - pay them damn tithes and shut up.
The majority of people go to church every Sunday and do is, so I guess they love the status quo.
bogart 6 years, 5 months ago
If the majority of people go yo church and the people voted no to gambling shouldnt the church by now have done something about web shops gambling. This is a factual doable seeable accomplishment by those Pastors already 6 months later who have faith in Our Almighty Lord and Saviour.
MonkeeDoo 6 years, 5 months ago
Scary that Nat Beneby was Chairman of BPL & RBC concurrently !!!
sheeprunner12 6 years, 5 months ago
Both have gone belly up under the same person ....... HMMMMMMM He will probably be knighted like Snake for his national contributions
Socrates 6 years, 5 months ago
we need to remember that prior to the General election and quite commonly throughout the Caribbean, patronage and awarding of contracts and jobs, etc., was considered a by-product of victory accepted by all. so despite being ethically wrong, we didn't see it as such and it was practised to some extent by all...
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