Farmers who are owed more than $300 million for paddy supplied to the Mahaicony Rice Limited (MRL) since the first crop this year may be in for a longer wait.
When MRL’s accountant failed to produce records to auditors on Monday the company breached the Rice Factories Act. As a result the Guyana Rice Development Board (GRDB) reported the matter to police at the Mahaicony Police Station
Minister of Agriculture Robert Persaud recently told Stabroek News that the file which is being put together by police will be sent to the Director of Public Prosecutions (DPP) for it to be prepared for court.
Persaud said that he had since written to his counterpart at the Ministry of Home Affairs, Clement Rohee, requesting that he ensure the matter was dealt with swiftly.
The Agriculture Minister, when questioned about whether the court case could mean that farmers would have to wait longer before receiving payments, said that it was something only the court could determine.
“We can only hope for an early judgment,” Persaud said.
MRL has been having problems with paying farmers for the last few years. However, payments to farmers have never before been outstanding for as long as eight months, as is the case now.
The GRDB and the Ministry of Agriculture have been trying for the last few months to make various arrangements with the company to see that farmers are paid. During a meeting with MRL owner Jai Beni it was noted by the Agriculture Minister that the company was still suffering from the effects of the global recession.
Beni admitted that the company was having some financial problems but had applied to the Ministry of Agriculture for time to sort out the difficulties. Later, the GRDB announced that it would be auditing MRL’s records to iron out the figures and determine exactly how much was payable to farmers.
Rice Factories Act
When auditors arrived at MRL on Monday the company refused to turn over the records. This refusal was in breach of Section 10 (1) of the Rice Factories Act which states: “The Chairman or the General Manager of the Board, or any person authorized in writing by or on behalf of the Board or the head of any of the entities referred to in section 3(2) or anyone authorized in writing by or behalf of such head, may at all reasonable times enter a rice factory and inspect it or any padi or rice therein or any books kept under this Act or any written law.”
Section 10 (2) of the same Act states: “Any person who refuses to permit any person authorized by or under subsection (1) to do anything referred to therein shall be guilty of an offence and shall be liable to a fine of one hundred thousand dollars and imprisonment for a term not exceeding six months.” And Section 15 declares that: “All offences and penalties under this Act may be prosecuted and recovered under the Summary Jurisdiction Acts.”
GRDB General Manager Jagnarine Singh told Stabroek News that it was MRL General Manager Taramatti Ghani who refused to have the records handed over to the auditors and therefore she would be the person punishable for breaching the law.
Ghani was asked to report to the Mahaicony Police Station on Tuesday morning. However, Singh could not say whether she had met with police.
When questioned about the issue last week Singh said that the matter was now being dealt with by the police and he was not very sure what the current status of their investigation was.
Singh further said that the court matter was between the GRDB and MRL and would not directly affect farmers. Court proceedings, Singh believed, would not affect the length of time farmers would have to wait before receiving payments from MRL.
Some farmers in Region Six, according to him, had received payments from the company prior to the breach of the Rice Factories Act.
‘Asset rich’
MRL, several sources within the industry recently told Stabroek News, is “cash poor” at the moment but still remains “asset rich.” If the company was as serious and as committed as it professes to be about clearing its debt, sources said, they would be able to do so by selling just one of their mills.
“MRL is not bankrupt,” one source stressed. “In fact if you look closely at their worth you’ll see that while they have a cash flow problem they are very, very what you call asset rich.”
Persaud, when questioned about the issue of seizing MRL’s assets, explained that this can only be done if a court order is obtained. Farmers, he said, would have to make the ultimate decision of taking legal action against the company.
The Ministry of Agriculture has offered to provide support to farmers and to stand the cost of legal services if they wished to move against MRL in court.
However, several small farmers who are owed just over $1M by MRL have expressed concern about the length of time legal proceedings will take. They have pointed out that waiting until almost the end of the second crop for payment owed since the first crop has affected their finances and injected second thoughts about rice farming in their minds.
“It real hard you know… imagine is my money and to get it I got to wait and wait and wait,” one farmer, who declined to have his name published, told this newspaper. “I am 65 and I does work hard; suppose I die before I get pay for my paddy what going to happen to my money then?”
