GO-Invest forensic audit report… No action taken against those fingered in financial misdeeds

Jan 04, 2018 News

By Kiana Wilburg

Former CEO of GO-Invest, Keith Burrowes

A damning forensic audit report on the Guyana Office for Investment (GO-Invest) had revealed that there were grave instances of mismanagement of funds and abuse of authority. More than one year later, those who were implicated in such actions have not faced any disciplinary action.

This was confirmed by Minister of Business, Dominic Gaskin during an interview with Kaieteur News.

To begin, Gaskin emphasized that there was no recommendation for disciplinary measures to be instituted against anyone. Further, he said that there has been personnel change at the leadership level. So, even if there was a recommendation for administrative discipline, this could not have been effected.

The Minister stressed that GO-Invest is now led by a very capable Board of Directors that is operating with a measure of independence – in that, there is no interference from the office of the Minister or the office of the President, as was the case in times past. He said that the board is therefore free to act on the findings and recommendations of that audit report as it sees fit.

The Business Minister said, “There have been a number of positive improvements at GO-Invest which began before the completion of the audit report. I am also aware that the Board of Directors has taken steps to address some of the recommendations and findings of the report. This includes the hiring of a Deputy CEO and streamlining certain administrative procedures such as the updating of the Human Resources and Accounting Manuals.”

He added, “GO-Invest/investor services have improved because the manner of engaging investors has been streamlined. There is greater emphasis on due diligence, accountability, transparency and professionalism.”

The Minister also boasted that there is a better relationship between GO-Invest’s key agencies such as the Guyana Revenue Authority (GRA) and the Guyana Lands and Surveys Commission. Gaskin said that this has certainly improved investor confidence in dealing with the agency and has won over a lot of skeptics who might have had unsavory experiences with the agency three or more years ago.

FORENSIC AUDIT

It did not take much for forensic auditors to realize that under the guidance of former CEO, Keith Burrowes, GO-Invest had its own style in conducting procurement-related transactions. It was a style, however, that was everything but transparent.

Not only did Burrowes abuse his authority and treat the company like his private business, but he acted as though GO-Invest was his personal piggy bank.

According to the audit report, the former CEO took personal loans amounting to over $3M without approval from the Board. The auditors noted, however, that those monies were returned. The forensic auditors also stressed that the former CEO was not entitled to an entertainment allowance or salary advance(s) from GO-Invest, since his salary was funded from Guyana National Co-operative Bank/Guyana Co-operative Financial Services.

Be that as it may, Mr. Burrowes still authorized and received an entertainment allowance for himself totaling $480,000, without the approval of the Board of Directors.

Compounding the issue of misuse of authority was the fact that Burrowes instructed that his personal driver, Mr. Nigel Gordon, be paid a sum of $232,365 for carrying out duties as a driver. This was in spite of the fact that this “personal driver” was not a GO-Invest employee.

The forensic auditors found that this instruction was given by a Memorandum dated December 22, 2014, and executed the following day.

It was also discovered that there was no clear policy at GO-Invest for remuneration of employees. Burrowes dealt with this process in a “discretionary” manner.

Business Minister, Dominic Gaskin

Furthermore, Burrowes made it seem as though his Human Resources Officer was redundant. In this regard, forensic auditors found that the hiring function was conducted in an ad hoc manner, thus allowing the former CEO to solely make hiring decisions.

In fact, Burrowes sourced applicants, invited and conducted interviews for new people hired by him, instead of utilizing the Administrative Department. The interview committee comprising the CEO, Accountant/Personnel Officer and a Senior Investment Officer, was rarely utilized. He also re-designated employees and fixed new allowances for them. The Accountant/Human Resources Officer/Administrative Officer had little or no input in the recruitment and selection process.

It was also discovered that repairs and maintenance of vehicles were performed by mechanics “sole sourced” by Burrowes, instead of being tendered.

If that was not enough, Burrowes as CEO, expended over $1M on cell phones for senior staff, his personal driver and the Financial Consultant. This was in spite of the fact that his personal driver and one Financial Consultant were not employees of GO-Invest, and therefore not entitled to such privileges.

The auditors concluded that Burrowes’s tenure at GO-Invest was one where ad hoc and peculiar decisions were made in several areas.

Given the aforementioned, forensic auditors attached to Nigel Hinds Financial Services (NHFS) recommended that all outstanding staff advances should be recovered or cleared as specified by the terms of the loan agreement.

Additionally, the auditors were resolute on the decision that the unauthorized payments of $232,365 made to the personal driver of the former CEO should be recovered from him.

They said that unauthorized funds spent on cell phones for Burrowes’s personal driver and Financial Consultant, Ms. Patricia Harris, should be recovered from Mr. Burrowes.

It was also recommended that legal action under the Fiscal Management and Accountability Act, Section 85 should be considered. The auditors said that this was in relation to collusion among management at GO-Invest to withhold due returns to the Consolidated Fund at the end of the year. This also happened under the guidance of Burrowes.

The GO-Invest forensic audit report is available on the Ministry of Finance’s website: http://finance.gov.gy/wp-content/uploads/2017/05/Forensic-Audit-Report-Go-Invest-.pdf.)