(Trinidad Express) State carrier Caribbean Airlines (CAL) is facing a potential write-off of approximately TT$200 million in losses, including TT$60 million lost from what executives say could amount to credit card fraud related to airline ticket purchases.
More than TT$100 million has already had to be written off from the company’s cargo department.
A report submitted to the CAL board of directors recently stated the losses were incurred because there were no policies in place to ensure the enterprise got its earnings.
Four executives from the company’s management team, who had oversight over those operations but failed to stop the haemorrhage from the company or come up with solutions to recover the money lost, have been identified by other senior staff for the losses.
The Sunday Express obtained a series of e-mails and documents last week which point to questionable actions by management of the company with regard to several multi-million dollar transactions which have handicapped the organisation financially.
The Sunday Express understands the CAL board has already sanctioned an independent company to conduct an audit of the multi-million cargo losses and has instructed the management team to fix the credit card issues related to ticket purchases.
With regard to the credit card problems, the Sunday Express understands basic principles were not followed when tickets were booked. It has cost the company millions, sources close to the operations explained.
Since the inception of CAL, the Sunday Express learnt that management never adopted the basic controls required for online and call centre credit card transactions and was not concerned about the millions of dollars these lack of controls cost the company.
With regard to the cargo revenues, the Sunday Express understands the losses occurred in 2011 and 2012.
For 2011, the company will write down TT$21.4 million of overstated revenue and will write off TT$40.4 million of uncollected cargo revenue.
CAL, the Sunday Express learnt, could not determine if all manual invoices raised have been settled. In 2012, the company will write down TT$43 million of overstated revenue, and will write off TT$44.3 million of uncollected cargo revenue.
“It has not been sufficiently determined since the invoices are done manually as such there is no accurate method to track if payment is collected on all invoices,” the note read. The Sunday Express understands that when CAL began operations in 2007, it simply had an “honour” agreement with its cargo operators who paid the company afterwards and as such, was always in the red with payments as CAL was never up to date on invoicing its customers.
The Sunday Express learnt the independent review of the cargo issues will be presented to the board this week and it is expected a senior executive could be dismissed.
Another executive, speaking to the Sunday Express on condition of anonymity, pointed out that it was “gross negligence” and “incompetence” on the part of CAL’s management over the past three years which led the company to its present state.
While the executive conceded that CAL was to some extent mirco-managed by its board, he pointed out the management was hired to run the organisation for its best interest while the board is supposed to be principally focused on governance issues.
Some executives further allege certain officials at the airline sought to ingratiate themselves to the board but never sought the best interest of the company.
Several attempts to reach CAL’s acting chief executive, Robert Corbie, yesterday to respond to the allegations and finger-pointing at several of his senior staff members were futile.