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Laws broken in handling of Exxon signing bonus, Chris Ram says
-urges president to launch probes, apologise for ministers’ actions.
December 10,2017
Analyst Christopher Ram yesterday said that laws have been broken in the handling of the signing bonus government receiv-ed with the renewal of ExxonMobil’s oil exploration agreement and he has called on President David Granger to call in the police for a criminal probe and to apologise to the nation for the “deception” of some of his ministers.
Ram also specifically called for a public inquiry into the administration of the Ministry of Natural Resources, including the negotiation of contracts outside of Guyana and all its financial transactions in local and foreign currency.
“If President Granger wants to regain the public trust in his administration, he needs to apologise to the nation for this diabolical act by his Ministers, remedy the violations, call in the Police, and take surgical action. But not before mounting a public Inquiry into all aspects of the administration of the Ministry of Natural Resources, including the negotiation of contracts outside of Guyana, in Gre-nada and in New York; the process leading up to the signing of an unnecessary, new Petroleum Agreement with Esso Exploration and Production (Guyana) Limited; and all financial transactions in local and foreign currency,” Ram, a chartered accountant and attorney, said in a statement issued yesterday.
His statement came a day after Stabroek News and Guyana Times on Friday published a letter, dated September 20, 2016, from Finance Secretary in the Ministry of Finance Dr Hector Butts to the Bank of Guyana Governor Dr Gobind Ganga seeking the setting up of an account for the funds from the signing bonus. “I shall be grateful if you would arrange for the under-mentioned Foreign Currency Account to be opened at Bank of Guyana, in order to receive a deposit in the form of a signing bonus to be given by ExxonMobil. This account should not be treated as part of the Bank’s reserves. Instead, the proceeds should be held in the currency of the deposit, that is, United States dollars, and invested in secured interest-bearing securities,” Butts said in the letter.
On the same day of the publication of the letter, Natural Resources Minis-ter Raphael Trotman, also admitted to the National Assembly that government received the signing bonus, which he had for months refused to confirm.
Trotman, who did not disclose the value of the signing bonus, also claimed the publication of the letter appeared to be organised to cause embarrassment to the government. He said the bonus was intended to be used for legal fees pertaining to the preservation of Guyana’s territorial integrity in the potential court case stemming from its border controversy with Venezuela. “And yes, Mr Speaker, we did what we did, to preserve the safety and wellbeing of the people of Guyana and to safeguard the sovereignty and territorial integrity of this country and Mr. Speaker, if it is we are to be blamed, let us be blamed, Mr. Speaker, for doing what is right and as had been done by the previous administration, we seek only to defend our country,” he said.
According to Ram, Article 216 of the Consti-tution of Guyana, which provides that all revenues or other moneys raised or received by Guyana shall be paid into the Consoli-dated Fund, has been knowingly violated.
On this point, Opposi-tion Leader Bharrat Jagdeo on Friday also observed to the National Assembly that the failure to transfer the funds from the signing bonus into the Consoli-dated Fund amounted to an “almost a criminal breach of our financial laws.” Jagdeo, whose administration had been accused of similar breaches, has called for the resignations of Trotman and Finance Minister Winston Jordan as he contends that they misled the nation on the signing bonus.
‘Web of deception’
Addressing the implications of the failure to transfer the funds into the Consolidated Fund, Ram said that critical information contained in the Estimates of Expenditure now being considered by the National Assembly is inaccurate, incorrect and meaningless. He also said that the 2016 financial statements of the government and of the Consolidated Fund are similarly deficient for 2016. Additionally, he said the situation also means that the Report of the Auditor General for 2016 is inapplicable and that auditing standards applied by his Office requires him to withdraw his report. Similarly, he noted that the financial statements and the auditor’s report of the Bank of Guyana for the year 2016 face the same jeopardy. “…this web of deception has ensnared high level officers of the Ministry of Finance, the Geology and Mines Com-mission and the Bank of Guyana, including the Chairman of its Audit Committee Mr. Anand Goolsarran,” he added.
Ram also noted that when in opposition, the current government and very specifically the AFC, of which Trotman is now leader, had repeatedly claimed that former Finance Minister Dr. Ashni Singh should be taken before the courts on a criminal charge under the Fiscal Management and Accountability Act. “It is as clear as day to me that offences have been committed under section 85 of that Act by more than one person. This is now a criminal matter and the Guyana Police Force should be called in,” he said.
Section 85 of the Act states, “An official who—
(a) falsifies any account, statement, receipt or other record issued or kept for the purposes of this Act, the Regulations, the Finance Circulars or any other instrument made under this Act;
(b) conspires or colludes with any other person to defraud the State or make opportunity for any person to defraud tile State; or
(c) knowingly permits any other person to contravene any provision of this Act, is guilty of an indictable offence and liable on conviction to a fine of two million dollars and to imprisonment for three years.”
Honesty, decency and integrity
Ram argued that with ministers having shown a willingness “to engage in a conspiracy of deception” on the people of the country in a significant transaction with ExxonMobil, they cannot be trusted to engage any person, let alone the oil giant.
He singled out Trotman and noted that he sought to defend his deception by resorting to patriotism, “which Samuel Johnson so famously and aptly described more than two hundred years ago as “the last bastion of the scoundrel.”” “Transactions in foreign currency, the award of contracts by Mr. Trotman, and the payment of money by his Ministry, suggest that Mr. Trotman cannot be trusted even with a single dollar of public funds…,” he added.
Ram noted that the “forced admission” by government of the signing bonus came after 18 months “of denial and obfuscation” and he called it “a shocking revelation of a conspiracy to deceive the people of Guyana about billions of dollars, involving a galaxy of ministers, including four of Granger’s famous Quintet plus one, and involving two key ministries and their Ministers.”
He noted that one of the ministers could possibly say that he was equally lied to by his colleagues about the origin and purpose of the money. “But such is that damning path to corruption that injects the resource curse virus into the bloodstream of third class politicians managing third world petro countries,” he observed.
Additionally, Ram said the petroleum resources of the country do not belong to a “cabal” ensconced in the administration but to all Guyanese, present and future. “Each such Guyanese expects and deserves that its government – whether APNU, PNC or PPP – owes to them honesty, decency and integrity demonstrated in accurate accounting, proper accountability and good governance, not only on World Anti-Corruption Day but each and every day of the year,” he added.
Anti-corruption group Transparency Institute Guyana Incorporated (TIGI) on Friday accused the government of “deliberately” deceiving the nation on the signing bonus and said it was shocked by the confirmation that it was received.
The group further noted that while in the opposition, the APNU and AFC railed against mismanagement of state funds and were especially adamant about the use of the Consolidated Fund as provided for by the law. “The APNU-AFC coalition government is therefore well aware of the law governing the consolidated fund and about what moneys should be deposited there. The move to set up a separate account to receive the signature bonus therefore appears as a move to avoid accountability,” it said, before arguing that the situation must galvanise all Guyanese into demanding transparency and accountability.
Signing bonus should be returned to ExxonMobil.
December 10,2017
Dear Editor,
We must all express our gratitude and appreciation to my good friend and professional colleague, Mr Christopher Ram, for disclosing that the government was in receipt of a signing bonus of US$20 million from ExxonMobil. When the matter was brought to the fore in the media, government officials vehemently denied the existence of such a transaction, contending that “it was a figment of imagination”. Now that it has been confirmed that the government did receive a signing bonus, a number of issues arise:
- Did the government demand the bonus, or was it offered by ExxonMobil? This is not clear. In any event, the payment is, in my view, improper or irregular, since the only compensation the government is entitled to, for the grant of a petroleum licence is in relation to the licence and other fees, royalty on production, and a share of the profits based on the Production Sharing Agreement. Any payment to the government outside of these cannot be considered legitimate and should be rejected.
- Is the signing bonus reflected in the agreement with ExxonMobil? We do not know since the agreement has not yet been made public. Suffice it to state that any such provision in the agreement would not appear to be proper in view of the above.
- Was it a breach of the Constitution and/or the FMA Act for the money to be placed in a special account at the Bank of Guyana? Definitely so! Since the agreement is between the government and ExxonMobil, the signing bonus is considered public money or public revenue. As such, it should have been paid over to the Consolidated Fund in accordance with Article 216 of the Constitution and Section 38 of the Fiscal Management and Accountability Act. The only exception is in relation to funds to the credit of an extra-budgetary fund created by an Act of Parliament. However, no such fund has been created.
In view of the foregoing, I am of the firm view that the signing bonus should be returned to ExxonMobil, and the bank account at the Bank of Guyana closed. In the defence of our territorial integrity, we must be prepared to use our own resources, and our own resources only, and not depend on handouts from entities that do business with us. When this happens, it sets in train a dangerous precedent for all sorts of things to happen, and we end up compromising ourselves. Remember, there is no such thing as a free lunch!
Yours faithfully,
Anand Goolsarran
The person who leaked the letter deserves our thanks.
December 10,2017
Dear Editor,
If there was any doubt in the minds of the people of Guyana about where the country is and where it is headed, look no further than Saturday’s headlines of the self-proclaimed “The Nation’s Newspaper”, the Chronicle. The sordid and serious circumstances surrounding the cover up of the Exxon signing bonus were trumped (pun intended) by the pitiful attempt to divert attention by ridiculing the Leader of the Opposition with a story that more properly belongs in the comics section of the newspaper. The main story of the day (for any true journalist) was referenced in smaller print with the positive spin that the Exxon money was intended for ICJ legal fees and that “…Trotman sees evil intention in leaking of letter.”
The headline starkly highlights the danger of the resources of the Guyanese people funding what has historically for many decades been a propaganda arm of whichever party is in government. This situation was equally reprehensible when the PNC was in power and when the PPP was in government, and is no less so now that APNU holds the purse strings. The newspaper should be divested immediately. But to the matter at hand:
The two principal players in this tragi-comedy, Raphael Trotman and Winston Jordan continue to attempt to justify their duplicity by ridiculous deflection, semantics and obfuscation that remove any doubt that they are patently unfit for the important positions that they hold or for any government positions whatsoever. They seem unaware of the damage their breach of trust has caused not only to the institution of government but also in the international community to whom the country will no doubt be held up to ridicule.
No, Mr Trotman’s “evil intention” is all his. The person who leaked that letter deserves our thanks and did this nation a huge service displaying the courage and wonderful patriotism so lacking in many who pretend to represent us. As Mr Trotman so blithely said on Friday in Parliament: Let him or her be blamed! And as for Mr Jordan, we are not children. His pathetic remonstrations about the lack of specificity of questions on the issue and that: “Nobody asked me if the government received a signing bonus; they had a specific figure attached to it and my specific response is ‘no,’” would be laughable were it not for the damage he has done to our nation’s credibility. And by the way, the journalists did do their job in exposing this farce, the lies and the deception.
Guyanese must no longer accept the justification that their side did it so our side should not be criticized when they betray the nation’s trust. I have no dog in this political fight and may have to reimburse funds to many of my friends in the USA whom I naively convinced in 2015 that a change in government would see a new day of accountability and transparency in Guyana so sadly lacking for many decades.
Of course, I know that President Granger is extremely deliberate in his decision-making so I look forward to Monday, after he has digested all the facts over the weekend, when he announces that he cannot justify keeping in his cabinet those involved in this stain on his government and the nation
Yours faithfully,
Robert McRae
Why go to such lengths to lie about the signing bonus?
December 10,2017
Dear Editor,
Just when one would have thought that the APNU+AFC coalition could not have sunk lower in the eyes of the Guyanese people, they defy expectations and do just that.
The latest scandal involving their blatant dishonesty about the receipt of a signing bonus from the oil giant ExxonMobil, and their obvious intention to siphon off the amount received, must surely go down as an all-time low, judging even by their already very low standards.
The Minister of Finance is arrogantly quoted on Saturday as saying that he was not obligated to reveal the details of the receipt and that when he was previously asked about this matter, the questions asked gave him an opportunity to say nothing so he said nothing. Well, this is a most alarming declaration coming from the custodian of the public purse, and if this is his understanding of his accountability and answerability to the people of Guyana, then the people of Guyana will wait a very long time to enjoy any benefit from any oil money when it starts to flow.
Exactly the same can be said about the Minister of Natural Resources and the Minister of State, both of whom flippantly dismissed their previous public misrepresentations on this matter.
The questions are simple and have to be asked. Why say nothing about it? Why go to all these lengths to lie about this matter? What is there to hide? Why go to all these lengths and run the risk of political embarrassment and scandal to conceal that this amount was received? Why was the amount not deposited into the Consolidated Fund or into a GGMC account as required by law? Where is this amount reflected in the national budget estimates? Why did so many members of the Cabinet conspire to conceal the facts of this matter?
The answer is probably found in the diktat given to the central bank that the amount be kept in a secret bank account outside the bank’s reserves. Surely, if the intent was to comply with the law, the receipt of this amount would have been treated like any other receipt of any other government revenue and placed in the Consolidated Fund.
Those questions need answers now. And somebody has to be held accountable for the lies told to the people of Guyana. Otherwise, Guyana can forget about any oil money any time soon. It will all end up in a secret bank account on which the Cabinet feels that they need not say anything, as they did on this occasion, because they clearly believe Guyana is their private property to do as they please.
Yours faithfully,
Donald Ramotar
And Jordan would like to be President.
Former Member
Granger doesn't care about public opinion. He walked away chuckling the last time he was asked about appearance.
Former Member
Mitwah posted:And Jordan would like to be President.
How about Harmon? He seems to be the current president. He fits right in with the PNC dictators.
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