Former CEO took millions in personal loans from Go-Invest

Forensic audit findings

… authorised $480,000 entertainment allowance for himself

… personal driver paid $232,365

The forensic audit into Go-Invest, conducted by Nigel Hinds and Associates, has unearthed situations where former Chief Executive Officer (CEO) Keith Burrowes, used his authority to run roughshod over the entity he was entrusted with.
According to the forensic audit report, Burrowes took a personal loan amounting to over $3 million, without any approval from the Board of Directors. In fact, Burrowes was not entitled to an entertainment allowance or salary advances, as Go-Invest was not responsible for his salary.

The report noted that as CEO of Go-Invest, a position he vacated in 2015, Burrowes’ salary was financed from the Guyana National Cooperative Bank (GNCB)/Guyana Cooperative Financial Services.
“However, as at July 31, 2015, Mr Burrowes had personal loans from Go-Invest amounting to $3.2 million. The outstanding amount was fully repaid by February 2016.”
The report also noted that Burrowes authorised and received an entertainment allowance for himself, to the tune of a whopping $480,000. This was done without the approval of the Board of Directors.
“Salary advances were abused by senior management. In some cases advances exceeded two or three times their salary. Despite the regulation that no staff should have more than two advances outstanding, the regulation was often not adhered to,” the auditors revealed.
While Burrowes used his own authority to authorise monetary payments to himself, Hinds and Associates found that there was no clear policy for paying employees. The report noted that whenever employees were paid, the CEO did so at his discretion. In fact, auditors found that Burrowes re-designated employees and fixed new allowances for them. But that was not all. According to the forensic audit, the former CEO exercised sole control in hiring new employees. His jurisdiction was at the expense of the recruitment, Human Resources Manager and Accountant, who had little to no input in deciding who to hire. “Mr Burrowes sourced applicants, invited and conducted interviews for new hires by himself, instead of utilising the administrative department. The interview panel comprising the CEO, Accountant/Personnel Officer and a Senior Investment Officer was rarely utilised.”
The audit found that even Go-Invest employees’ pension plans were not safe. In 2014, the Workers Pension Plan was suspended, creating “a sense of insecurity among staff of Go-Invest”. Auditors noted that this was the workers only security for retirement.
In accordance with the ad hoc system in place, the report detailed that Burrowes, as CEO, instructed that his personal driver be paid $232,365 for his service. This was done despite the driver not being an employee of Go- Invest.
“This instruction was given by memorandum dated December 22, 2014, and executed on December 23, 2014,” the report revealed.
Go-Invest is a statutory body which functions as the facilitator of local and foreign investment in Guyana. Considering the substantial portfolio Burrowes managed, governance structures would normally be in place to prevent mismanagement.
But according to the report, Go-Invest did not have an Internal Audit Department or Audit Charter. And according to Hinds’ report, in his observations, the audit firm’s initial requests for documents were hampered at first, though they eventually procured the documents with cooperation from staff.
“As a consequence, they are not prepared to improve the agency’s governance, risk management, provide checks and balances and implement internal controls.”
“Go-Invest operated without a documented governance structure, this allowed for ad-hoc decision-making, resulting in serious deficiencies in how the agency was managed at both the Board of Directors and Executive level for the period under review.”

Recommendations
The auditors recommended that the unauthorised payments to Burrowes’ personal driver should be recovered from Burrowes himself. They also recommended that all outstanding staff advances be recovered or cleared according to the terms when they were made.To prevent reoccurrences, auditors recommended that an internal audit department be established. It was noted that having this in place would improve governance, risk management and internal controls.
“An audit charter, audit plan and an audit manual should be documented. The internal audit charter provides the functional and organisational framework within which internal audit will operate.”
“The charter will set out the scope, objectives, authority, accountability role and responsibility of internal audits within Go-Invest.”
Burrowes stepped down as CEO in 2015 due of the flurry of criticisms levelled against him. He also came under fire from the Private Sector Commission. It had been reported that Burrowes’ decision was prompted by the criticisms that he was a “political appointee.”
The Go-Invest audit is one of several commissioned by Government into State entities in 2015.
It was only on Thursday that Leader of the Opposition, Bharrat Jagdeo, renewed his challenge for the Government, rather than just talking, to hire a firm to go after those who were involved in malfeasance in office. This, he had stressed, was only if claims of such malfeasance were legitimate.