29 Nov 2005

Solomons PM at centre of probe into missing compensation funds

2:33 pm on 29 November 2005

The Solomon Islands Prime Minister, Sir Allan Kemakeza, has been identified as being at the centre of allegations over millions of missing dollars in compensation payouts.

There's been no action taken despite the information being known to the ministry of finance for some time.

The auditor-general, Floyd Fatai, has tabled a critical report in parliament which states that 5.7 million U.S. dollars remains unaccounted for out of a total loan of 20.7 million dollars from Taiwan's Exim bank.

He says the money, which was designed to compensate those who had suffered damage to property during the ethnic tension, was disbursed by the Ministry of National Unity and Reconciliation.

Mr Fatai says the loan was received in four tranches from 2001, and the audit showed that some funds were transferred without property authority or procedures, and the ministry did not mention the missing millions to cabinet.

"What we noted in our audit was that only the cheque numbers were listed. There were no names and no reasons as to why these payments were made. In their report to cabinet on the disbursement of these funds, there was no reference to that amount as to what it was spent on, and who was paid."

The minister at the time of the payments was the current prime minister, Sir Allan Kemakeza.

Mr Fatai says the audit office assessed a number of claims, representing 69 percent of the total monies disbursed, and found that 100 percent of them were either excessive claims or completely false.

Of the 60 claims assessed, 100 percent of them were either excessive or had been falsely claimed. Now, what some people did is that they inflated the claim so as to arrive at a desirable assessed value and that would be paid by the Solomon Islands government. Other claims were totally falsified.

The auditor general says one of those claims was made by the former minister and he gives the figures in Solomon Islands dollars.

There is a case that whilst the MP had been paid 851,000 dollars, his actual property was only estimated at 150,000 dollars; one, five, zero.

Mr Fatai says this information, along with that about the unaccounted missing millions of dollars, was passed on to the former finance minister, Francis Zama, last November.

But, he says there's been no formal reference of the case to the police.

The police have, however, charged the ministry's former permanent secretary, Lucien Kii, with compensating himself hundreds of thousands of Solomon Islands dollars and for depositing a government cheque in his account.

Mr Fatai says he thinks the ministry of finance should have acted on the information.

Up until now, there's no action taken so it is in that context, that I've seen it fit to make the report known to public through the speaker of parliament.

The acting commissioner of police is yet to respond to questions about whether an investigation has been launched into the prime minister.

The former and current finance ministers as well as the government's communications department have been unavailable for comment.