GMC audit fingers fmr GM now GRDB head

… Director Rahman demands dismissal

The Guyana Rice Development Board (GRDB) Director Jinnah Rahman is calling for the dismissal of former Guyana Marketing Corporation (GMC) General Manager (GM), now GM of the GRDB Nizam Hassan and the Permanent Secretary (PS) of the Agriculture Ministry George Jarvis.

His comments come in the wake of revelations of financial mismanagement of the GMC’s fertilizer account, which was unearthed from a Forensic Audit into the operations of the entity.

According to the audit report, “during the period 2008 through 2014, it appears that GMC entered into a series of questionable and apparently fraudulent financial transactions in regards to the management of the fertilizer account.”

The report unearthed number of transactions that were concluded “without proper support or authority.” These included payments to the Rice Producers Association of $35M; excess repayment to GNCB (Guyana National Co-operative Bank) of $120M; a $450M loan to GuySuCo, in addition to a letter of credit arrangement in the sum of $273M; and payments to the tune of $111M to the Ministry of Agriculture for Vertical Pumps which the report says was requested by the PS of Agriculture Ministry.

With respect to GuySuCo, the report highlighted that $450M loan was interest free and came with a clause which stated that $87M was the only amount that needed to be repaid to the GMC. When fielded with questions on this transaction, Hassan refused to answer.

As it pertains to the excess payments, the report stated that the GNCB loaned monies to the GMC to purchase fertilizer. When the body found out that the GMC did not however, purchase any fertilizer, it requested a refund of its loan. Instead of returning $553M to GNCB, GMC overpaid $673M to the bank, resulting in an overpayment of $120M.

In its defence, the reports highlighted that the management of GMC stated that no overpayment of $120M was made to GNCB. It stated that a debit memo dated November 5, 2008 was sent to the General Manager of Scotia Bank requesting a transfer of $120 million from the fertilizer account to GuySuCo: “This was reflected in the debit note that was received from Scotia Bank and was dated November 6, 2008.”

Management also stated that the decision to expend money on axial pumps was a Cabinet decision taken on October 07, 2014: “In addition, the Permanent Secretary of the Ministry of Agriculture received a correspondence dated November 6, 2014 from the Secretary to the Cabinet regarding the procurement of the four vertical axial flow drainage pumps. Importantly, the accounts to which the money should be sourced were also stated in the correspondence.”

However, the audit report also noted that then GMC GM, Hassan, refused to provide the auditor with certain information and crucial documents, thus preventing them from properly auditing the fertilizer programme’s transactions.

According to the forensic audit report “It appeared that the entire fertilizer program was conceptualized to circumvent financial accountability laws and to provide funding to GuySuCo and others using sinister methods.”

Rahman in calling on Agriculture Minister Noel Holder to fire Hassan and Jarvis. He said in a release that the revelation of the forensic report into the GMC, which was headed by Hassan, and now GM of the GRDB, “is extremely frightening. Mr Hassan’s actions at the GMC is a pattern of behaviour which has now caused the rice industry to be on the verge of collapsing following the secret contracts that were signed with brokers for sale of rice to Jamaica.”

He said further that Hassan, “who should have been appointed by GRDB, was handpicked by George Jarvis, Permanent Secretary of the Ministry of Agriculture and Minister of Agriculture Noel Holder. These two officials have blatantly violated the regulations of the Rice Board, which clearly states that the General Manager must be appointed by the Board of Directors… The records show that Mr Nizam Hassan could not sell Cassava at Guyana Marketing Corporation and has no experience in the marketing of Rice or paddy.”

This is not the first time that calls have been made for Hassan to be sacked as GM of the GRDB. In April of this year Chief Executive Officer of the Guyana Stockfeeds Inc (GSI) and the Pegasus Hotel Robert Badal made similar calls. Badal had said Hassan’s refusal to release GSI’s customs shipping bill in order for it to ship two containers of parboiled rice to two Jamaican customers are frustrating rice exports and the implementation of reforms which are necessary for the industry. He had called for Hassan to be replaced by someone more capable. Attempts to contact Hassan for a comment or response to the audit findings and calls for his dismissal were unsuccessful.


Nizam-Hassan (clean) Rahman