After the public declarations of culpability being assigned, talk of “heads rolling” and the millions in tax dollars evaded in the Fidelity Polar Beer scandal, little if anything has materialized and the preliminary inquiries (PI) of those officials currently before the court could take three years to complete.
The Polar Beer case exposed a number of things at the GRA, including weaknesses in the system and critically, the link between the business community and corruption.
In the two years since the episode became public matters have seemingly fallen apart; persons initially charged have been set free because of a lack of evidence and there will have to be 68 separate PIs for those who have been charged. A string of low-level employees attached to the Customs and Trade Administration (CTA) and two customs brokers formerly tied to Fidelity are the only persons currently in court.
Stabroek News was informed that a total of 68 charges are on file against the employees, all of whom had been sacked by GRA. Since the matters are indictable the Preliminary Inquiries (PIs) are expected to be done separately. Of the 14 persons currently in court, around nine are being prosecuted in a single PI which is underway.
Attorney Nigel Hughes, who is representing several of the individuals charged, told this newspaper last week that only two witnesses have testified in the PI which is being conducted before Magistrate Fazil Azeez.
The charges were filed in April and the case is scheduled to be called again next month. Hughes said the PI is still in the “initial stage,” noting that the evidence is now being taken.
He said that based on how the cases are to be tried the court will have to conduct a total of 68 separate PIs. “It means that we could be dealing with this Polar Beer case for another three years or more,” he added. Asked how much longer the current PI has, he said about eight months.
Hughes said he is unaware of any plea bargain that was said to have been cut in the case. “I have no idea what that is about,” he stated, adding that none of the people he represents have cut any deal with the state. He noted that he is not sure whether the persons outside of his representation intended to cut such a deal.
Talk of a plea bargain agreement emerged when President Bharrat Jagdeo said that someone had agreed to “turn state’s witness” but to date there is no state witness in the case and/or mention of a plea deal. There is speculation that Joshua Safeek of Fidelity Investments, who was cleared of the charges instituted against him, had struck a deal with the state but his attorneys continue to deny this.
Initially, culpability was laid at the feet of Fidelity Investments, which had evaded millions of dollars in taxes on a large shipment of Polar Beer. GRA slapped Safeek with eleven charges and one of his subsidiaries Kong Inc with another eleven charges in relation to a quantity of allegedly uncustomed Polar Beer it says was imported into Guyana by Safeek’s company. He was accused of producing falsified documents to customs.
Kong Inc is part of the SAFECO group of companies owned by Safeek. The SAFECO Group also comprises Fidelity Investments Ltd, the National Co-operative Credit Union, Caricom General Insurance formerly GUYFLAG Insurance and the Commodities Store. According to GRA, it had a concrete case against Safeek and his company because of the number of uncustomed Polar beverages (73,383 cases) which it had seized from the bond belonging to the company.
Subsequently, the Director of Public Prosecutions, Shalimar Ali-Hack discontinued eleven tax evasion charges against the beverage company Kong Inc and Safeek, clearing them both of complaints that triggered the huge probe into underhand activities at customs and a raft of charges against the GRA employees.
The dropped charges raised many questions, including whether he had agreed to testify for the state, but the move also meant that GRA’s case was not as solid as was stated. GRA never commented on the fact that the charges were dropped though prior to this, the revenue body had accused Fidelity of evading millions in taxes.
Further, the discontinuation of the charges against Safeek appeared to have ignored the report of an Auditor-General led team which had investigated the scandal extensively. A special task force headed by Auditor General (ag) Deodat Sharma, which probed the allegations of corruption surrounding Polar Beer imports, had contended that Fidelity submitted false documents during the investigations, and therefore recommended that the relevant charges be instituted against the importer.
While a string of serious disclosures was made in the report, stretching from customs declaration forms that had numerous discrepancies to data being tampered with after being inputted into GRA’s TRIPS system, the task force report also focused on a critical part of the investigations, which were the taxes that were allegedly evaded by Fidelity; customs duties totalling $321.5M were said to have been evaded during the scam. It was recommended that custom duties and taxes be calculated on the polar beer found at Fidelity and, any other fine as prescribed by the Customs Act and or any other relevant legislation against the importer [Fidelity]. To date, no fine has been imposed on the company,
The report concluded that it was Polar Beer that had been brought into the country and not soft drinks as had been claimed by some Customs employees. Furthermore, while a price of US$2.15 per case had been listed by Fidelity, an investigative team that travelled to Venezuela found that Fidelity had been sold the beer at US$4.40 per case.