A forensic audit of the Guyana Office for Investment by Nigel Hinds has found numerous problems and said that after over twenty years of operations the agency has failed to fulfil its mandate and the organisation is plagued with poor governance, mismanagement, no strategic plan, an absence of Standard Operating Procedures for the various departments of Go-Invest and no policy for Investment Agreements. The September 30, 2016 report described the agency’s filing system for investor documents as “appalling”.
The Go-Invest audit is one of dozens commissioned by the David Granger administration.
An excerpt from the executive summary of the audit report released by the Ministry of Finance today follows:
In many instances, files examined had un-dated draft Investment Agreements, which undermined the integrity of the documentation process for a key area of Go-Invest responsibilities. This opened the verification and review process to opportunities for forgery and undermined the use of an audit trail.
In one instance an unsigned Investment Agreement (IA) for Sun and Sand Mining and Mineral Resources (UK) Ltd.; with initialled pages had a clause that the hotel will be provided with a tax holiday for a period not exceeding ten years. In all other cases where tax holidays are granted, it was done via a Memorandum of Understanding.
The unsigned cover letter from then CEO of Go-Invest, Mr. Keith Burrowes, detailed that Housing/Trade Minister, Mr. Irfaan Ali had requested that Sun and Sand Investment Agreement be sent directly to Finance Minister, Dr. Ashni Singh. The normal procedure is for the IA to be addressed to the Guyana Revenue Authority and copied to the President of Guyana, Minister of Finance and the Chairman of Go-Invest.
The determination of whether the potential investor be the land owner or have lease ownership of the of the location where the investment is taking place; cannot be determined from any policy document of Go-Invest re: 1. The Government was obligated to lease to Sun & Sand Mining & Mineral Resources (UK) Inc. – twelve acres of land at $200,000 per year for three years, with Sun
& Sand having the option to purchase after three years at an undisclosed price. The Government was obligated to sell a plot of land to Buddy’s Hotel Royale for $8M per acre, where the hotel was being constructed. The eight million dollars would become due and payable on completion of construction of the hotel and commencement of operation.
The Government was obligated to sell a plot of land to Georgetown Investment and Management Services Inc/Princess.; for $7M per acre on the date GMIS acquired ownership of Buddy’s International Hotel.
For Atlantic Hotel Inc./Marriott there is no clause in the MOU indicating that the state land on which the hotel is located has any provision for lease or purchase by Atlantic Hotel Inc./Marriott. There is no evidence on file showing the rationale or consideration that supports the methodology used to explain, reconcile or justify the terms of the four Memorandum of Understanding Agreements.
Ms. Leanna Damond, Investment Officer made a statement dated February 5, 2015 that she was instructed by CEO, Mr. Keith Burrowes to sign an MOU on behalf of the CEO, Go-Invest for Buddy’s Hotel Royale. Ms. Damond claimed in her statement that the instruction was given to her by way of a telephone call on January 22, 2015.
Ms. Damond further stated that she was specifically instructed not to let Ms. Roxanne Sumner, Senior Investment Officer sign the MOU and to treat the MOU as strictly confidential. Ms. Damond stated that she was instructed by Mr. Burrowes to sign four copies of the MOU on behalf of the CEO and also to sign the Investment Agreement for the same company.
Mr. Burrowes in a correspondence to Mr. Omprakash Shiwraj, strangely dated January 10, 2015 and prior to the signing of the MOU by Ms. Leanna Damond on behalf of the CEO, rescinded the MOU signed by Ms. Damond. Mr. Burrowes in the correspondence stated that the officer who signed the MOU was not authorized to sign the MOU and noted that “The Government of Guyana has also legitimately and statutorily vested such far reaching powers of conclusion, signing and acceptance of Investment Agreements and Memorandum of Understanding under the Executive Function of the Chief Executive officer for the Guyana Office for Investment.”
The letter was copied to Dr. Roger Luncheon, Head of the
Presidential Secretariat; Mr. Mohabir Anil Nandlall, Attorney
General and Ms. Uchenna Gibson, Officer-in-Charge, Guyana Office for Investment.
