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The Auditor General, Deodat Sharma has recommended that the Guyana Police Force (GPF) conduct an in-depth investigation and institute charges where necessary after a special audit conducted on the Attorney General’s Chambers between 2015 to 2020 showed that, during the period, legal procurement procedures were breached when contracting attorneys and law firms.
On Sunday, Attorney General and Minister of Legal Affairs (MOLA), Anil Nandlall shared the findings with the media which were presented to him by the Auditor General on December 22, 2020. On August 24, 2020 the Attorney General had written the Audit requesting that a special audit of the Attorney General Retainer Agreements be conducted to determine whether proper procedures were followed.
The special audit covered the period May 2015 to August 31, 2020 and focused on all transactions related to legal fees paid. Records examined included Tender Board Minutes and approvals, Payment Vouchers, contracts, and other supporting documents. The period falls under the coalition administration.
The audit found that the MOLA spent $170.8 million in 71 contracts awarded to 26 Attorneys-at-Law/Law Firms/Agency between May 2015 to August 2020.
Nandlall must answer
Previously when the issue of legal contracts were raised former AG, Basil Williams had said that his successor, Anil Nandlal was yet to respond to a claim that over $153Million was paid to foreign lawyers by the PPPC for one transaction inclusive.
“Nandlal must have been given the Quinquennial Report 2015 ‐ 2020 for the Attorney General Chambers and Ministry of Legal Affairs by the Permanent Secretary and even if he turns a Nelson’s eye to it, the undoubted fact is that the stewardship of Basil Williams SC was outstanding for President David Granger’s government.
Nandlal must account however for the work of the Advice and Litigation Division of the AG Chambers. He must tell the Guyanese prople about how many cases were won and lost; what advice was given to the various ministries and what has happened to the many cases involving hundreds of million dollars being claimed against the attorney general. For example the one equivalent to a budget inherited from the PPPC government which AG Williams refused to pay or settle and which is now his baby to protect so our taxpayers can benefit from it instead.
The question is why the deafening silence?”
Meanwhile, in the auditor general report some of the highest costing total contract sum went to Courtenay Coye LLP awarded for $34M for five contracts. When some $5M was deducted for withholding tax, the total amount paid was some $28.9M. Coye was procured in relation to the No Confidence case and the Case Management Conference at the Caribbean Court of Justice (CCJ).
The next highest total contract sum went jointly to Rex McKay, S.C and Neil Boston, S.C. The sum for three contracts was $29M and when $580,000 withholding tax was deducted, they were paid $28.4M. Their legal services were required for the No Confidence Vote in Parliament and legal advice, drafting and preparation, travel expenses and accommodation for Attorneys-at-Law to Trinidad for CCJ Court of Appeal.
The Law Firm Fraser, Housty and Yearwood held two contracts for $21.2M. When $425,500 withholding tax was deducted, the total amount paid was $20.8M. They were hired for procurement of Legal Services to the Attorney General’s Chambers for the period 2014-2015.
The highest payout for contracts occurred in 2019 with 29 contracts amounting to over $102M. This is followed by 2017 with 16 contracts at $20M and 2018 with 15 contracts at $27M.
During the year 2019, the sum of $207.2M was budgeted for Line Item 6284 – Others. The report shows that MOLA Appropriation Accounts for the year 2019, amounts totalling $199.6M were expended as shown in the table below. Examination revealed the sum of $99.1M were paid to ten Attorneys-at-Law/Law Firms.
Based on the documents examined by the Audit Office, there was no evidence to conclude that the contracts were publicly advertised, which is in breach of Sections 25(1) and 10(1) of the Procurement Act of 2003.
The Section states: “Subject to subsection (2), public tendering is mandatory. For such tendering an invitation to tender or to prequalify, as applicable, is mandatory” and ‘the procuring entity shall maintain a record of the procurement proceedings including the means used to solicit suppliers or contractors and a record of any such advertisements.”
Furthermore, it was highlighted that the Direct Contracting/Single Source method was used to award these contracts, another breach to Public Procurement Procedures. “It was observed that cases where the Attorney/Firm would have represented the MOLA at more than one Court hearings, approval was sought from MTB (Ministerial Tender Board) and later on NPTAB (National Tender & Procurement Administration) for the additional hearing and vice versa,” the report stated.
Added to this, it was found that during the period under review, withholding tax was deducted for contracts exceeding $500,000. The rate for withholding tax was charged at 2 percent for companies which are housed locally and 15 percent for companies which operated out of the country. Audit scrutiny revealed amounts totaling $10.5M were paid to the Guyana Revenue Authority (GRA) in respect of the 71 contracts that were awarded.
Further audit verification revealed that five overseas Attorneys-at-Law/Firms were used during the period under review to provide legal services to the MOLA which resided overseas. These include Ralph Thorne, Hal Gallop Q.C, Courtenay Coye LLP, Brian Horne and Justin L. Simon, QC of Simon Rogers Murdoch.
The Audit Office therefore recommended that the Legal Affairs Ministry: “Ensure that there is full compliance with the Procurement Act 2003 with respect of awarding of contracts; appropriate disciplinary action should be taken against any culpable Officer(s); and that the Guyana Police Force be called in to conduct an in-depth investigation and institute charges where necessary.”
