Iraq is boosting its efforts to extradite fugitives wanted in corruption cases.
On Jan. 25, Iraqi authorities in cooperation with Interpol took custody of former Trade Minister Abdel Falah al-Sudani, who had been extradited from Lebanon. Sudani, a fugitive since 2009, had been tried and sentenced in absentia to seven years in prison for corruption.
Ziad al-Qattan, the former general secretary in the Ministry of Defense, was extradited from Jordan and handed over to Iraqi authorities Jan. 11. Qattan is accused of embezzling about $1 billion from the ministry.
“Such steps toward trying accused [politicians] in a country that is at the top of the list of the most corrupt countries, such as Iraq, are of paramount importance to regain the people’s confidence in the Iraqi judiciary and its ability to tackle corruption,” legal expert Ali Jaber told Al-Monitor.
“The extradition of wanted people is twofold. The procedure goes through the bilateral agreement between Iraq and other countries and through the international police [Interpol],” he said.
The UN Charter allows countries fighting terrorist groups to ask for assistance from the Security Council, which is the case with Iraq. These countries can also claim funds that had been smuggled abroad.
“Many countries have been helping Iraq to recover funds and take fugitives into custody,” Jaber said. “I believe that Iraq will witness many breakthroughs in the future at this level, especially since the Iraqi government said tackling corruption will be its top priority after the end of the war on the Islamic State.”
In early January, a representative of the Japan International Cooperation Agency met in Iraq with Integrity Commission Chairman Hassan al-Yasiri to discuss, among other topics, coordinating anti-corruption efforts.
The Integrity Commission said Iraq, with Interpol’s help, recovered about 2 billion Iraqi dinars ($1.68 million) in December from nine convicted fugitives by tracking their money and conducting investigations to follow financial transactions globally.
Many officials accused of corruption remain free, however. Some have dual nationality, which makes it easier for them to leave. For example, Basra Gov. Majid al-Nasrawi used his Australian passport to flee Iraq in August. He faces charges of stealing public money.
There are also warrants out for the arrests of fugitive officials wanted on corruption charges, including former Minister of Electricity Ayham al-Samarrai, former Transport Minister Louay al-Ors and former Defense Minister Hazim Shaalan, who was accused in 2005 of being involved in the theft of at least $1.3 billion from the ministry.
Judge Abdul-Sattar al-Birqdar, a spokesman for Iraq’s Supreme Judicial Council in Baghdad, explained extradition procedures to Al-Monitor. “The Supreme Judicial Council issues warrants for the recovery of smuggled funds. The Extradition Division in the public prosecutor’s office follows up on the matter. The prosecutor then issues the necessary decisions,” which could entail property confiscation.
Legal expert Tariq Harb told Al-Monitor, “The current process in Iraq is that the authorities hand over the official documents of charges of the accused to Interpol. In the event Interpol catches the accused, the Iraqi security authorities will take them into custody to stand a fair trial.”
Iraq’s increased efforts to recover assets from abroad will help speed up the often lengthy process of extradition. However, “this doesn’t mean this road won’t be fraught with many obstacles, as many of the accused are linked to powerful politicians who could pull some strings to derail or end the procedures.” Some countries might also use prisoners as bargaining chips, he said.
Ahmad al-Jubouri, a member of the parliamentary Legal Committee, told Al-Monitor, “The process to recover funds and arrest [those accused] is of major importance, as the Iraqi people have been demanding reforms and the fight against corruption. Under this pressure, the Iraqi government has started to take serious steps” and has even hired foreign companies to help track funds and facilitate extradition. “The upcoming period will witness major changes in corruption investigations,” he said.
He added, “The arrest of Sudani and Qattan will open the door to further arrests of the people who misused and smuggled public funds to neighboring countries. Some of the accused are traders and businessmen who made illicit deals in the name of influential politicians or political parties. Iraq is known for the rampant corruption among politicians. The arrests will include all those who took part in or facilitated embezzlement of public funds. This will be a crucial step in recovering these funds.”
A director of the Department of Finance (DOF) is facing sanctions after she used official funds for a dinner that she hosted, Finance Secretary Carlos Dominguez said on Sunday.
by ABS-CBN News
MANILA - A director of the Department of Finance (DOF) is facing sanctions for using official funds for a dinner that she hosted, Finance Secretary Carlos Dominguez III said on Sunday.
Dominguez said a probe found out that a dinner hosted by the director for 40 persons was inappropriately included in the official costs of the workshop funded by the Asian Development Bank (ADB).
He said the director was explicitly ordered to conduct the workshop at the Ayuntamiento de Manila in Intramuros without dinner, and the costs charged to the finance department's regular budget.
However, the official decided on her own to have the event held at the EDSA Shangri-la on July 17, with dinner included, and the costs charged to an ADB-administered Technical Assistance facility, according to the Finance chief.
Dominguez said he has already ordered the DOF director to return to the exact amount spent for the dinner to the ADB.
"I have also accepted the resignation of the official," he added.
Dominguez said he has also ordered DOF officials to "review and tighten the department’s internal procedures to avoid similar incidents in the future."
In their ongoing work targeting corruption in aid and development, the World Bank has announced new debarments of companies from bidding and winning contracts with the bank — including five subsidiaries of SMEC, a leading supplier of engineering services for aid and development projects throughout the world. But as SMEC are managing multimillion dollar aid projects currently in operation, what happens now? Devex investigates.
By Lisa Cornish
CANBERRA — Australian-based SMEC, one of the world’s largest engineering services for aid and development projects, and four of its subsidiaries have been debarred by the World Bank for 108 months collectively for bribery and misrepresentation in its South Asia projects.
The announcement was made last Thursday, with the World Bank revealing evidence of inappropriate payments in relation to World Bank-financed projects in Sri Lanka and Bangladesh, as well as misrepresentations to meet bidding requirements under World Bank-financed projects in Sri Lanka and India.
In August last year, ongoing investigations against SMEC were revealed in a report from the Australian Broadcasting Corporation and Fairfax media. According to the report, the Australian Federal Police were investigating allegations of bribery of government officials in Sri Lanka and Bangladesh.
While many donors have been caught by surprise by the debarment, others — including the Department of Foreign Affairs and Trade — have been anticipating the outcome of the investigation prior to placing their own sanctions on the company, expected soon. The bank debars scores of companies each year, with 981 debarred firms currently listed, but sanctions on a group as prominent in aid programs as SMEC are rare.
What is the extent of World Bank sanctions?
The debarment has impacted the operations of SMEC subsidiaries in Australia, Bangladesh, India, and Sri Lanka. All received a 30-month minimum period of sanction. Australian operations will receive a 12-month period of ineligibility followed by an 18-month period of conditional non-debarment. India will receive a six-month period of ineligibility, followed by a 24-month period of conditional non-debarment. And the two SMEC subsidiaries in Bangladesh and one in Sri Lanka face a 30-month period of ineligibility.
Conditional non-debarment means SMEC is still eligible to participate in World Bank-financed projects as long as it meets the conditions of their Negotiated Resolution Agreement.
But debarment will only conclude if SMEC can demonstrate a number of requirements to the World Bank Group's Integrity Compliance Officer. They must prove that they have put in place and satisfactorily implemented an effective integrity compliance program acceptable to the bank, have fully cooperated with the bank, and have fully complied with the terms and conditions under their NRA.
“The World Bank’s disclosure policy does not allow the disclosure of investigative details so as not to compromise the integrity of the process and/or the security of witnesses,” a spokesperson for the World Bank told Devex. But the spokesperson said their processes are aimed at early detection and intervention of processes deemed corrupt. “It is important to invest in early detection of red flags and prevention efforts, particularly in high-risk projects and/or sectors where governance capacity is a challenge. This is one of the prominent features of our engagement with clients and partnerships with donors.”
Under the Agreement for Mutual Enforcement of Debarment Decisions, the debarment means all signatory multilateral development banks will assess SMEC for further debarment, including the African Development Bank, Asian Development Bank, and International Monetary Fund.
For donors outside the Agreement for Mutual Enforcement of Debarment Decisions, the World Bank is providing information to aid donors and other concerned governments on the nature of the findings. “The World Bank refers its investigative findings to concerned national authorities so that they can determine whether or not there is any violation of national legislations and/or the need to conduct their own independent assessment or investigation,” a spokesperson at the World Bank said.
How will existing contracts be impacted?
An analysis of aid contracts reveals an extensive range of contracts SMEC are currently contracted to deliver, including multimillion dollar contracts for the AfDB, ADB, DFAT, and World Bank.
“When a company is debarred, it basically cannot engage in any new World Bank-financed project,” a spokesperson for the World Bank said. “This would apply to all debarred companies.”
Despite debarment, however, a company under contract is committed to complete the terms of its contract with development banks under the Agreement for Mutual Enforcement of Debarment Decisions. But for the World Bank, carrying out contract obligation is met with additional oversight from the Integrity Compliance Office, part of the Integrity Vice Presidency, who will work with SMEC to ensure that it fulfils the integrity compliance obligations under the settlement agreement.
Similarly, a spokesperson for the Office of Anticorruption and Integrity at the ADB explained that contracts awarded before the debarment would not be affected. “However, we will continue to carefully monitor and assess implementation of ongoing contracts involving debarred parties. Also, contract variation for contracts awarded to debarred parties prior to their debarment must be endorsed by OAI to ensure that a contract variation involving a sanctioned party is not an attempt to circumvent the sanction.”
Outside of the multilateral development banks, existing contracts are not so secure.
SMEC is an important player in engineering programs, delivering services across the world. Among the organizations to recently award contracts to SMEC was the Millennium Challenge Corporation, who in March awarded a $671,000 contract to SMEC for consultancy services for the assessment and business planning activities of the Electricity Generation and Transmission Company in Sierra Leone
The response from MCC was swift, including a halt of all payments to SMEC.
“MCC takes allegations of and proven examples of fraud or corruption extremely seriously,” a spokesperson for MCC explained to Devex. “MCC is reviewing the situation with its partners at the Millennium Challenge Coordinating Unit in Sierra Leone, in accordance with internal MCC processes. MCC has informed MCCU that payments to the firm under the current contract are to be temporarily suspended while MCC reviews the situation. MCC is also informing all Millennium Challenge Accounts and their respective procurement agents of the debarment, and that no new contracts are to be signed with the firm.”
SMEC will be debarred from MCC-funded procurements for the duration of its debarment by the World Bank, but MCC is contacting SMEC directly to obtain their explanation of the situation. In collating the information gathered, MCC explained they will decide whether the current contracts should continue. “If MCC or its partner organizations believe there may have been fraud or corruption under the current contracts, MCC will inform USAID's Office of the Inspector General's Office of Investigation for possible investigation.”
In Australia, SMEC has been a prominent company in delivering large-scale engineering services for domestic and international projects — including a controversial feasibility study to pumped hydro-storage capability to deal with ongoing Australian domestic energy issues.
For Australia’s aid program, SMEC has been an important partner on 43 projects and panels since 2008, according to AusTender data, including three ongoing projects.
“The department is currently assessing the impact of debarment on its existing agreements and current and future tenders,” a spokesperson for DFAT explained to Devex. But they are less concerned about corruption within their own programs, which involve three ongoing contracts having a value in excess of 300 million Australian dollars (approximately $248 million). “The department understands that the issues that led to SMEC's debarment do not involve DFAT funds.”
But internal contacts suggested to Devex that sanctions were likely.
The response from SMEC
In response to the sanctions, SMEC have explained to Devex that they are working in cooperation with the World Bank under the terms of the NRA.
“This NRA brings to conclusion the World Bank’s inquiry into alleged misconduct in those countries dating approximately from the period 2007 to 2009, to which the company has extended its fullest cooperation,” Angus Macpherson, director of operations for SMEC, said. “The company will fulfill all existing World Bank contracts in these markets.”
But Macpherson explained that there are SMEC entities not restricted by the NRA, which does not restrict the activities of a number of SMEC entities who will continue to be entitled to bid and win development contracts.
And they are working to ensure donors that steps are being taken to improve oversight and prevent any chance of corruption or fraud in their business.
“SMEC International wishes to assure its clients and partners that it maintains a zero-tolerance policy against fraud and corruption and will continue to strengthen its Corporate Integrity Compliance programme,” Macpherson said.
The World Bank recently sanctioned two French companies for separate allegations of corruption in developing countries. On November 30, the World Bank…
The World Bank recently sanctioned two French companies for separate allegations of corruption in developing countries. On November 30, the World Bank announced that Oberthur Technologies SA, a French digital security company, was debarred for 2.5 years for “corrupt and collusive practices” related to a project that would establish a national ID system in Bangladesh. As part of its Negotiated Resolution Agreement (NRA), Oberthur acknowledged “improper payments to a sub-contractor and collusive misconduct to obtain and modify bid specifications to narrow competition and secure the award of the contract.” Oberthur was credited for its “extensive cooperation” with the World Bank’s investigation, including voluntarily acknowledging the misconduct, proactively conducting an internal investigation, holding individuals accountable, and taking “preliminary steps to improve its governance and compliance procedures.”
On December 5, the World Bank separately announced that Sediver SAS, a French manufacturing company, was debarred for two years for a “corrupt practice” related to a project that would improve electricity infrastructure in the Congo. A World Bank investigation found evidence that the company “made improper payments to an employee of a consulting company to influence a tender process.” Under the NRA, Sediver’s parent company was also “conditionally non-debarred” for an 18-month probationary period. The holding company for the entities agreed to pay €6.8 million to the Congo, and the companies agreed to develop and implement a “group-wide integrity compliance program.” The holding company was credited for its “ongoing cooperation” with World Bank investigators, “acceptance of responsibility,” and “voluntary corrective and remedial actions.”
There is no shortage of buzz about Big Data in the anticorruption world. It’s everywhere — from public efforts like Transparency International’s public procurement analysis to cutting-edge pr…
by Chris Crawford
There is no shortage of buzz about Big Data in the anticorruption world. It’s everywhere — from public efforts like Transparency International’s public procurement analysis to cutting-edge private-sector FCPA compliance programs implemented by Ernst & Young. TI has blogged about Big Data and corruption, with titles like “Can Big Data Solve the World’s Problems, Including Corruption?” and “The Potential of Fighting Corruption Through Data Mining.” Ernst & Young’s conclusion is more definite: “Anti-Corruption Compliance Now Requires Big Data Analytics.”
The Inside Story of How Hungary Became Close to Putin
Great piece by Direkt36
András Pethő és András Szabó · 12 March 2018
The Inside Story of How Hungary Became Close to Putin
Intelligence operations, huge business deals, and personal ambitions. These are some of the factors that drive Hungarian prime minister Viktor Orbán in pulling his country closer to Russia, Direkt36’s investigation revealed.
Two influential Hungarian businessmen boarded a plane bound for Moscow weeks before Hungary’s April 2010 parliamentary election. Both men belonged to the inner circle of Viktor Orbán, head of the Fidesz party, which was predicted to win comfortably at the polls. One of them was Lajos Simicska, a longtime friend of Orbán and his ally in making Fidesz the dominant political force in Hungary. The other person was Zsolt Nyerges, one of Simicska’s associates and an old friend of the Orbán family.
Upon their arrival in Moscow, the two businessmen headed to Lubyanka Square, one of the most notorious locations in the Russian capital. The large yellowish building towering over the square used to be the headquarters of the KGB, the feared Soviet secret police. Now it is the home of its successor, the FSB. Simicska and Nyerges had a meeting with a senior official of this organization.
The visit followed an important meeting that had taken place a few months earlier. In November 2009, Orbán, already a favorite of the upcoming elections, met Russian leader Vladimir Putin in Saint Petersburg. The purpose of that meeting was for the two politicians, who had never met before, to get to know each other. The goal of Simicska and Nyerges’ trip was to establish new business relations between the leadership of the two countries.
Years later, Orbán and Simicska would turn against each other, but around the time of their respective visits, they seemed to be inseparable allies. While Orbán was fighting on the frontline of Hungarian politics, Simicska was working behind the scenes to provide solid financial support for Fidesz. They discussed the most important political and financial decisions, including the ones concerning Hungary’s relationship with Russia.
Simicska and Nyerges’ trip has never been reported in the press, but it was known in Fidesz circles, and some officials in the previous government have also been aware of it. Direkt36 has learned of the visit from three sources independent from each other. Simicska did not respond to our questions while Nyerges said that he never talks to the press. Orbán’s office did not answer the question of how much he knew about the two businessmen’s trip.
Orbán’s allies went to meet an FSB official because the Russian secret service is often involved in state-related businesses. Sources familiar with the meeting said that no concrete deals came out of it. One source described it as an “introductory visit.” Another said that the FSB official told Simicska and Nyerges that, if they need help in business, they “can rely on Russia.”
The 2010 meeting shows how Orbán and his inner circle made efforts to forge a close bond with Putin’s Russia even before they won the 2010 election by a landslide. Since then, this connection has attracted worldwide attention. Putin, who is considered a dangerous opponent by most Western leaders, has become a frequent visitor to Budapest. Hungary and Russia have also struck several major business deals. Most notably, Orbán’s government decided to contract Rosatom, the Russian state nuclear company, to expand Hungary’s Paks Nuclear Power Plant — a choice made without a public tender.
Orbán had been a staunch critic of Russia for most of his career, so exactly what led him to seek ties with Putin has been the subject of widespread speculation in recent years. Direkt36 spent months interviewing more than thirty sources with knowledge of Orbán’s moves. Because of the sensitivity of the issue, all of them asked for anonymity.
According to these sources, Orbán has been telling his own people that he’s building a closer relationship with Russia to strengthen Hungary’s standing internationally. He thinks that Hungary’s economy can profit from this connection, and he believes it also gives the country a better bargaining position vis-à-vis Western powers. Orbán, according to those who know him, enjoys maneuvering among powerful leaders. He finds Hungarian politics boring and is convinced of his own extraordinary political abilities (of which he even brags about in private).
Civil Servant Known as "Baron" - by Aynur Imranova
Ahmad Ahmadzade is one of the civil servants, who held various positions during the Soviet Union regime. He started off as a workman in 1961 and somehow gained "Baron" for a nickname. Apart from the fact that the cooperation he is leading is a subject to numerous bribery and embezzlement scandals, he also made sure all his relatives now hold good positions, which in fact made him the "clan elder." He is also the son of the well-known professor Juma Ahmadzade, and named his own son after his father. By marrying his son off to the daughter of Elman Rustamov, the chair of the Central Bank, he further straightened the family ties.
A quick recall: Azerbaijan Amelioration and Water Management (AAWM) OJSC currently led by Mr. Ahmadzade is an entity consisting of 120 departments. Department of irrigation systems - 48 offices, collectors' maintenance department - eight offices, water reservoirs, hydro junction and magisterial channels department - 13 offices, irrigation departments - four offices, automatic irrigation department - 10 offices, Sub Artesian wells maintenance department - nine offices, melio service departments - 23 offices, ASC Azerbaijan amelioration and water management, technical production and acquisition department, Azerbaijan state institute of water management units design, scientific research institute of water problems, research institute of hydrotechnics and melioration, hydrogeological amelioration service department, united department of irrigation facilities and construction amelioration and Bahramtapa reinforced-concrete plant are among the 120 establishments. At the same time, around 25,000 people are employed by AAWM. Annual total turnover of organizations lead by Mr. Ahmadzade pass 1 billion manats.
As the nation reels from the news of the EFCC’s arrest of the Managing Director of the Nigerian Railway Corporation, Mr Adeseyi Sijuwade, following his indictment by the State Security Service (SSS), questions are being asked as to whether he could have acted alone or in concert with others.
The Great Nigerian Railway 100 Billion Naira Robbery And The Ooni Of Ife's Connection - BY CITIZEN REPORTS
THE CHARGE
“Investigation has revealed that the process for the award of the contract for the rehabilitation of NRC Eastern line, Port Harcourt – Kaduna Junction and that of the other NRC Eastern line, Kafanchan – Maiduguri, is fraught with corruption and irregularities, masterminded by Sijuwade. He has been accused of manipulating the contract procedures to favor predetermined contractors and recommending unqualified contractors for specified jobs” - SSS Report
THE BACKGROUND
The project involves major rehabilitation of Nigerian Railway Corporation’s existing narrow gauge single line rail track, including the bridges and culverts, from Port-Harcourt to Maiduguri. The estimated total length of track work to be covered is 1,654km. In order to enable quick delivery of the work within the expected time frame, the work is divided into two contracts.
Contract (3) covers the rehabilitation work from Port-Harcourt to Kaduna Junction through Kafanchan - approximately 916km. Consultant’s Estimate: N47.9 billion.
Contract (4) covers the rehabilitation work from Kafanchan to Maiduguri, including the branch line from Kuru to Jos, totaling approximately 738 km. Consultant’s Estimate: N30.7 billion.
Bids were invited in February 2010 by publications in the Nigerian press. Thirty-five companies expressed interest, and 13 of them were prequalified to submit technical and financial proposals. Twelve companies submitted bids in May 2010 and were evaluated by a team led by Sijuwade. Two of the companies were recommended to the Ministry of Transportation for the award of the contracts. In the end, Contract 3 went to Eser Nigeria Contracting Company Limited at N35.59 billion, while Contract 4 went to Syndicate Construction and Commercial Company Limited at N29.96 billion.
Complaints, however, followed the awards, and the Chairman of the NRC, Alhaji Bello Haliru, initiated an investigation which was later expanded to involve the SSS.
THE CRIME
The investigation revealed that Eser Nigeria Contracting, which Sijuwade recommended for Contract 3, had family connections with him.
It is alleged that his brother or a relative (one Aderemi Sijuwade), is a signatory to the bank account of the company held with Skye Bank at Adeola Hopewell Branch on Victoria Island, Lagos, and that records at the Corporate Affairs Commission reveal that the registered office of the company is 65 Queen Street, Alagomeji, Lago. That property belongs to an uncle of Sijuwade, the well-known Ooni of Ife, Oba Okunade Sijuwade. Aderemi Sijuwade is also known to be a Deputy Chairman of Espro Asphalt, an affiliate of Eser Contracting. One Prince Tokunbo Sijuwade has also been named as a Director of Espro Asphalt. Engr Adeseyi Sijuwade has up till now not declared this conflict of interest as required by the Public Procurement Act.
The Public Procurement Act in Section 57 sub. 10 provides that:
“Any person engaged in the public procurement and disposal of assets who has assumed or is about to assume, a financial or other business outside business relationship that might involve a conflict of interest, must immediately declare to the authorities any actual or potential interest.”
It further states in sub 11 that:
A conflict of interest exists where a person:
(a) possesses an interest outside his official duties that materially encroaches on the time or attention which should otherwise be devoted to affairs of government;
(b) possesses a direct or indirect interest in or relationship with a bidder, supplier, contractor, contractor or service provider that is inherently unethical or that may be implied or constructed to be, or make possible personal gain due to the person’s ability to influence dealings;
(c) entertains relationships which are unethical, rendering his attitude partial toward the outsider for personal reasons or otherwise inhibit the impartiality of the person’s business judgments;
(d) places by acts or omissions the procuring entity he represents or the Government in an equivocal, embarrassing or ethically questionable position;
(e) entertains relationships compromising the reputation or integrity of the procuring entity he represents or the Government;
(f) receives benefits by taking personal advantage of an opportunity that properly belongs to the procuring entity he represents or the Government;
(g) creates a source of personal revenue or advantage by using public property which comes into his hands either in the course of his work or otherwise; and
(h) discloses confidential information being either the property of his procuring entity, the Government or to a supplier, contractor or service provider to unauthorized persons.
Secondly, it was discovered that the company did not submit a Bid Security at the time the bids were opened in May 2010. In that case, its bid should have been disqualified for being non-compliant. It is alleged, however, that a Bid Security miraculously appeared among the company’s bid documents subsequently. Enquiries at the issuing bank revealed that the Bid Security was only issued in June 2010, several weeks after bid opening. It is further alleged that Mr Sijuwade, with the assistance of policemen, forcibly caused all the opened bids to be moved into his office from the Company Secretary’s custody presumably so that the Bid Security could be inserted subsequently. Under the Public Procurement Act, the insertion of documents such as Bid Security after bid opening is a serious offence attracting a minimum jail sentence upon conviction of five years, without the option of fine.
The Public Procurement Act in Section 58 sub 4 says:
The following shall also constitute an offence under this Act:
f) altering any procurement document with intent to influence the outcome of a tender proceeding ;
In Section 58 sub 8, the Act says:
An alteration pursuant to subsection 4( ) shall include:
b insertion of documents such as bid security or tax clearance certificate which were not submitted at bid opening;
Thirdly, it was discovered that Eser Nigeria Contracting was registered only a few months to the submission of the bids and had no work experience. Its submitted tax clearance revealed that it had no income and no assessable profit or loss. This means, in the opinion of a source at the Ministry, that such a company had no business bidding for high profile contracts of nearly N70billion.
Fourth, the company’s bid of N35.59 billion against the consultant’s estimate of N47.9 billion was adjudged to have been too low and deemed not compliant, as it is 26% below the consultant’s estimate. The prescribed tolerance margin under the act is +/-15% and the tendency is for bids to be higher than the consultant’s estimates, not lower.
As regards Contract 4, the recommended company by Sijuwade, Syndicate Construction, apart from having no requisite railway experience, submitted a fake tax clearance certificate as enquiries made to the FIRS office where the certificate was purportedly issued confirmed that it had not been issued by them. The company was further shown to have submitted a fake Bid Security, as GTB Bank, which allegedly issued the Security, disowned the document as not emanating from it. Several of Syndicate Construction’s other documents, such as its audited accounts, were allegedly falsified. Curiously enough, Sijuwade did not deem it fit to file a report with the EFCC against this company for fraud after it was brought to his attention that this company’s particulars were dubious. Instead, he set about trying to explain the lapses to see how they could be accommodated, and then went ahead to award the contract. It is alleged that his conduct was informed by his personal interest in the company.
Our source at the Ministry said that it is a big shame that the railway rehabilitation has been turned into a contract jamboree because of the attitude of people like Sijuwade. He told this reporter: “There are only three construction companies in Nigeria with the requisite experience and capacity to carry out work on our railways. Unfortunately and because of how Nigeria is, when you invite bids for railway work, you have thirty-five companies responding, most of whom have no business bidding for railway work. To make matters worse, it is the incompetent ones that are getting the jobs because they have connections. We have road construction companies who have no experience of railway construction and who have not even completed their contracts on our roads parading questionable foreign companies who they have never worked with before and who have no experience of working in Nigeria before as partners. Some of them submit audited accounts which do not match with the figures in their tax clearance because Sijuwade allows them. That is why a simple job like Lagos to Kano has still not been completed and may never be. This Eastern line contract is not the only indiscretion of Sijuwade. Everything he has done since he went to NRC has been dogged by controversies of manipulation, fraud and corruption. There is a case at ICPC and many others that nobody is talking about yet.” Even Mr. Sijuwade cv which he submitted is full of bogus claims.
When the ministry reviewed the tender process, they disqualified all the companies whose documents were not compliant. These included the companies favored by Sijuwade. This did not go down well with him. So what did he do? He canceled the procurement process and decided to start afresh. So after 10 months of a bid process, he is starting bidding all over again. The companies which submitted fake documents in the first place or inserted documents in their bids after closure are not barred from participation. They are now being afforded the opportunity to perfect their papers. All bidders’ prices are now known including the consultant’s estimate, since bids in the original process were opened on 26 May 2010. The only people who are being disadvantaged are those who meticulously complied with the terms of reference and submitted compliant bids. Is that fair? To make matters worse, the same Sijuwade who superintended the manipulated process in the first place is superintending the re-run. How can it ever be credible? Where is the Minister in this matter? Where is the Chairman of the corporation in this matter? Where is the Due Process office in this matter? Looks like they are all doing “see no evil, hear no evil, speak no evil.”
THE STORY OF CONTRACT 1 AND 2
When inquiries were made about the issues around the case with the ICPC, our Ministry source became agitated. He said, “That is the story of Lagos to Jebba (Contract 1) which they have promised and promised will be delivered but will never be on time because it was manipulated and given to a company without capacity to do it. It is a story of manipulation and flagrant breach of the Public Procurement Act by Sijuwade and covered up by the previous Minister, Ibrahim Isa Bio.
It is the story of how two companies sent in compliant bids, one was N14billion and the other N12billion, and they took the contract and gave it to the company that bidded N14billion at N12billion”. When a legal expert was asked if the government does not reserve the right to give a contract to anybody it likes to, he said, “Once you have submitted to the precepts of open competitive bidding under the Public Procurement Act, then the government’s discretion is limited by the law. It is a criminal offense to allow a company to change its price after bids have been submitted.
Section 31 sub. 3 of the Public Procurement Act is very explicit in this respect. It states that:
The following shall not be sought, offered or permitted:
(a) Changes in prices;
(b) Changes of substance in a bid; and
(c) Changes to make an unresponsive bid responsive.
The legal expert further said, “In law, when you see the word “shall”, and then it is mandatory. There is no room for discretion at all.”
The situation with the Contract 2 is even worse. The company which was awarded the contract has no railway experience whatsoever. Its bid was identical to the consultant’s purported estimate which is unrealistic and undeliverable. Purported estimate because something very strange happened in that consultant’s estimate.
One key element of work is the Akerri flood control work involving the erection of a major bridge across the river at Akerri. The consultant’s estimate in this segment is inconsistent with its estimates in the other sections of the bill of quantities where the similar scope of work is priced. Using the same rates from other sections of the consultant’s bill of quantities for identical elements of work, the consultant’s estimate for the Akerri works should be no less than N10billion. However, and by some miracle, the entire Akerri work was priced lump sum in the consultant’s bill of quantities as N2.75bn. Whereas in the other sections of the bill of quantities, the various elements of work are priced, in the Akerri section the individual elemental rates were left blank and a total lump sum figure of N2.75bn entered against the whole section. Whereas the other bidders priced the Akerri works at no less than N10bn, by some stroke of genius, the company to which the contract was awarded quoted a price of N4.46bn, which was closer to the purported consultant’s unrealistic estimate of N2.75bn for Akerri.
An analysis of the successful bidder’s prices side by side with the consultant’s estimate shows a pattern of being consistently below the consultant’s estimate in every other section. Only in Akerri is he higher than the consultant’s and it appears that the manipulation was a balancing figure to bring him to par with the ‘adjusted’ consultant’s estimate.
What needs to happen now is for that consultant to confirm if it really estimated Akerri at N2.75bn and to explain how he arrived at that ridiculous figure but who will ask him? ”I swear on my mother’s grave that he will not be able to justify it”, said our source.
The consequence of all this manipulation is that the Akerri work is standing there not up to 12% complete and the contractor does not know how to complete it. The contract was signed in February 2010 with 10 months duration which means it should have been completed by December 2010. At the current rate, only God knows when it will be completed and how much more will be needed. Meanwhile, trains cannot pass.
The question on many lips is, who are Sijuwade’s collaborators whose actions are helping to keep our railways moribund? Who are his protectors and why is he not in jail?
Our source lamented, “Don’t be surprised if the EFCC turn out to tell you that he has no case to answer. ICPC investigated Contract 1. Where is the case? A permanent secretary was arrested for obstructing the investigation. Where is the case? This is Nigeria wonderland. Anything and everything happen can here. Only God can save us from the Sijuwades of this country. Meanwhile, President Jonathan is seeking re-election so everyone is now a sacred cow.”
SIX contractors, who allegedly played prominent roles in the over N1 trillion railway construction and rehabilitation contracts, are to refund over N2.5 billion to the federal coffers.
By Emman Ovuakporie & Johnbosco Agbakwuru
ABUJA—SIX contractors, who allegedly played prominent roles in the over N1 trillion railway construction and rehabilitation contracts, are to refund over N2.5 billion to the federal coffers.
CCECC, executing Lagos to Jebba rail line, is to refund N640 million; Costain West Africa Ltd, executing Jebba to Kano rail line, N608 million and Geo Group Asano, signaling and communications upgrade, N368 million; Eser West Africa, handling the Port Harcourt-Markurdi rail line, N339 million.
Read more at: https://www.vanguardngr.com/2016/04/n1trn-rail-contract-6-firms-refund-n2-5bn-fg/
In an exclusive interview with RFE/RL, a former high-ranking Uzbek security-service official gives a detailed account of mistreatment during his own imprisonment.
The federal government won a one-month stay on discovery in a $77 million forfeiture proceeding in D.C. federal court Friday after accusing the Afghani defense subcontractor at the center of the case of abusing the civil process to aid his defense against criminal bribery charges.
A defense subcontractor accused of fraudulently securing jobs in Afghanistan urged a D.C. federal court on Wednesday to sanction its former attorneys at Neel Hooper & Banes PC for allegedly refusing to quit when fired from the $77 million civil forfeiture litigation and pushing for an improper lien.
A federal jury convicted a Romanian citizen today for his role in a government contract kickback scheme that caused a loss of more than $3.4 million to the U.S. Department of State.
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