The case of the disappearing US$5 million

Guyana is a land of mysteries. The problem is that many of them never seem to get solved. One of the more recent is the case of the disappearing US$5 million which was supposed to have been paid to Nicil as the balance for the sale of government-owned GT&T shares, but which has seemingly vanished into proverbial thin air.

It will be remembered that under the previous administration government sold its 20% shareholding in GT&T to the Hong Kong Golden Telecom Company, a subsidiary of Datang Telecom International, ultimately of China. The agreed purchase price was US$30 million, the initial US$25 million of which was to be paid on the completion date, and the balance of US$5 million on the second anniversary of the closing date, or such other date as the two parties might agree.

The US$25 million was paid to government holding company, Nicil, it would seem, but no one in either the previous administration or the present one appears able to account for the remaining US$5 million, which should have been paid over in 2014.

It was in March that Minister of the Presidency Joseph Harmon bounded off to China with an entourage which included businessman Mr Brian Tiwarie. The initial justification given for the trip by the Ministry of the Presidency was that it was for the purpose of engaging in discussions relating to the payment of the US$5 million balance owed to the government for the purchase of the GT&T shares. It was also revealed that one of the people accompanying Mr Harmon was Ms Natalia Seepersaud, the in-house legal counsel of Nicil.

The visit, it transpired, also had other purposes, but those need not concern us here. What is of interest is the fact that Minister Harmon was the one to follow up this matter, and not, say, the Minister of Finance. Furthermore, why did he consider it necessary to go to China at all to deal with the issue; surely the normal practice in this world of modern communications would be to handle everything from Georgetown, more especially as this country has the option of resorting to the courts – and the English courts too, as Nicil was subsequently to reveal.

A source close to Nicil had commented to this newspaper last month about the apparent lack of due diligence by the government group prior to the trip. “[S]houldn’t some work be done at home first?” the source asked rhetorically; “You can call up the company and enquire what the status is, if they can fax you documents, all those things. Get your house together so you know what you are dealing with before just upping and say, ‘Eh heh boy, we going to China to find this US$5M.’”

While the question of why Minister Harmon assumed the role that he did in the payment of the shares has not been answered, the public was informed by the Ministry of the Presidency that in his report to cabinet on the China trip he said that the investigations and enquiries conducted by the Guyanese delegation were highly successful, and that the team’s report would be submitted to the Nicil Board for deliberation, following which a full statement would be issued.

This was communicated to the media at the beginning of April, and we are now in mid-May and not a whisper has been heard from the Ministry of the Presidency on the issue, although others, including Nicil have had comments to make which have clouded the waters further.

The first of these came from Minister of Natural Resources Raphael Trotman who was, it appears, standing in for Minister Harmon in a post-cabinet press briefing. Mr Trotman told the media that Minister Harmon had obtained documents which showed that the US$5 million was paid over prior to the APNU+AFC coalition taking office and that efforts were underway to track the money. “…we are trying to track down to whom, how and where,” he was quoted as saying.

This had former president, Mr Donald Ramotar absolutely incensed, and in undiplomatic language he called the claim that the money had been handed over prior to the May 11, 2015, elections a “lie”. “I challenge the government to present the ‘documents’ it has received… so that the veracity of the evidence can be tested and authenticated,” he said in a statement.

Mr Ramotar then proceeded to say something which ordinary Guyanese will recognize for its common sense: “We are talking about US$5 million here and that is not a small sum by any standard. Clearly, if the company told anyone they paid the money they must produce documents of the bank transfers etcetera, because no one can go to Hong Kong on behalf of government and collect five million cash in a bag. That is not the way it works. Everyone knows that.”

It might be added that the former president also adverted to the fact that the current administration had conducted an audit of Nicil, and that audit would have told them how much money was collected from the sale of GT&T shares, what the money was utilized for and how much was outstanding.

But that was not the last word on this issue, since Nicil had also had something to say on its own behalf. First, it denied that it had received the outstanding US$5 million, which had become due on October 22, 2014, going on to state that despite several written requests by Nicil, the Hong Kong Golden Telegraph Company still failed to pay the balance of the purchase price. Furthermore, it said that in an attempt to avoid costly and lengthy adjudication of the matter in the English courts, it had requested the assistance of the Government of Guyana to persuade the Chinese company through diplomatic channels, to honour its contractual obligations.

Its next statements have caused even further confusion. It said that what was alleged by the purchaser’s signatory to the agreement was that following a series of communications with the former Guyana Ambassador to China (which had yet to be authenticated) the Hong Kong Golden Telecom Company had been assured that they were not required to pay the balance of US$5 million, because the company had not been granted the same minority protection rights enjoyed by Nicil (ie, two, instead of one, representatives on the GT&T Board of Directors) which it was alleged had been promised to them. The Chinese company also alleged, Nicil said, that the decision to waive the US$5M was contained in a side agreement.

So what is the truth of the matter? Was the Hong Kong Golden Telecom Company given a waiver, or wasn’t it? If it was, how and when did that come about? In other words, who authorized it, and did former president Ramotar know about it, for example? And if there was a waiver, where is the documentation relating to it? Additionally, in circumstances where the balance was waived, to what would Minister Trotman’s statement about documents showing money being paid, refer?

Conversely, if there is documentation about payment, then where is it, and just who does it record as having received the money? If it does indicate who received the money, what is taking the government so long to make it public? The Ministry of the Presidency told the public that Mr Harmon’s foray into China was very successful on this score, so if it was successful, what is there to hide, since everything should be clear to the administration by now?  Considering that the government has no compunction about releasing findings on its various forensic audits, just what is the problem in this case ‒ why the uncharacteristic silence?

In short, where is the money? The government needs to make a statement.




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