TIGI head moves to court for deposit of Exxon signing bonus into consolidated fund

Anti-corruption activist Troy Thomas has asked the High Court to order Minister of Finance Winston Jordan to immediately deposit the US$18 million received from ExxonMobil as a signing bonus into the Consolidated Fund, while saying that his failure to do so is unlawful.

In an application filed by attorney Christopher Ram, Thomas, the head of the Transparency Institute of Guyana Inc (TIGI), is also seeking, among other things, an order from the court directing that Minister Jordan account for the bonus in the amended estimates of revenues of the public sector for the years 2017 and 2018, while again arguing that his failure to do so is a violation of the Constitution and the Fiscal Management and Accountability Act (FMAA).

A hearing on Thomas’ application, which lists the Attorney General as the first-named respondent, is scheduled for January 15th.

Although the bonus was apparently paid in 2016, the government did not officially disclose its existence until December 8th, last year, when Natural Resources Minister Raphael Trotman made an admission to the National Assembly and explained that it was intended to be used for legal fees towards resolving Guyana’s border controversy with Venezuela.

Troy Thomas

Trotman’s admission was made after the publication by the media of a letter, dated September 20th, 2016 from the Ministry of Finance to the Bank of Guyana seeking the setting up of an account for the funds

President David Granger has said that the decision was made by him to place the US$18 million in an escrow account at the Bank of Guyana, though Thomas is contending that the account does not even meet the definition of an escrow account.

The applicant is arguing further that such actions constitute an offence under Section 85 of the FMAA, while noting that the President and Cabinet of Guyana have knowingly permitted the Finance Minister to breach the Act.

In accordance with Article 216 of the Constitution and section 38 of the FMAA, Thomas says that the US$18 million bonus and such other sums collected by the government under the Petroleum Agreement with ExxonMobil are public moneys and must therefore be paid into and form one consolidated fund.

Article 216 provides that “All revenues or other moneys raised or received by Guyana (not being revenues or other moneys that are payable, by or under an Act of Parliament, into some other fund established for any specific purpose or that may, by or under such an Act, be retained by the authority that received them for the purpose of defraying the expenses of that authority) shall be paid into and form one Consolidated Fund.”

Additionally, Section 38 (1) of the FMAA requires that “All public moneys raised or received by the Government shall be credited fully and promptly to the Consolidated Fund, except—(a) moneys credited to an Extra budgetary Fund as stipulated in the enabling legislation establishing that fund, (b) moneys credited to a Deposit Fund and (c) as stipulated in the Constitution.”

As far as Thomas is concerned, to do contrary, other than by way of an Appropriation Act, would be breaching Article 216, and must be declared unlawful, void and of no legal effect.

Deposit Fund

Section 42 (2) of the FMAA requires that “On the establishment of a Deposit Fund, the Minister shall notify the National Assembly of the Deposit Fund and shall specify—(a) the source or sources of the moneys in the Deposit Fund, (b) the purpose or purposes for which moneys may be expended from the Deposit Fund, (c) the banking arrangements for the Deposit Fund and (d) the intended investment strategy for the moneys deposited in the Deposit Fund.” Thomas says these conditions have not been met.

In his affidavit supporting his application, Thomas recalled the government and Finance Minister refusing to admit the existence of a signing bonus, or that any such bonus had been received, although he contends that under Article 218 (1) of the Constitution such a disclosure should have been made.

That article provides, “The Minister responsible for Finance or any other Minister designated by the President shall cause to be prepared and laid before the National Assembly before or within ninety days after the commencement of each financial year estimates of the revenues and expenditure of Guyana for that year.”

Thomas contends that at all times the President, the Cabinet of Guyana and the Minister of Finance knew, or ought to have known of the existence of these legal provisions.

Referencing a December 15th, 2017 report by the Department of Public Information, Thomas notes that Minister of Foreign Affairs Carl Greenidge confirmed that the Cabinet approved the receipt of the funds and so did the President, thereafter clarifying that “cabinet does not discuss where the foreign inflow goes,” but that the use of the funds was a different matter.

From that report, Thomas also notes, “The Minister said he did note that the approval of the funds was subject to a recommendation by President Granger, who instructed that the funds be placed into a special account, in the event that it is needed urgently.”

This, he believes, contravenes Section 42 (2) of the FMAA.

In his affidavit, Thomas says he has also been advised by his lawyer that the signing bonus has not been included as receipts in the National Estimates of 2016, 2017 or 2018.

It is against this backdrop that he said Jordan’s actions were “willful, reckless, grossly unlawful and illegal” and warrants an order of exemplary damages being granted.

In addition to the orders, Thomas is also seeking a number of declarations, including among them, that it was unlawful to place the bonus in an account other than the Consolidated Fund and that the decision to do so and not disclose it was a breach of the FMAA.

He also wants a declaration that the exclusion by Jordan of the bonus received in 2016 as revenue collected for that year is a violation of Article 218 of the Constitution and Section 38 of the FMAA.

Meanwhile, Thomas is seeking vindicatory, aggravated and exemplary damages against the government for all of what he has outlined as breaches and violations of his constitutional rights. He is also asking for costs and such other orders, directions or writs as the court considers just and as the circumstances warrant.

More than a year after a new petroleum agreement was signed with ExxonMobil for works in the offshore Stabroek Block, the government, in the face of public pressure, unveiled the pact on December 29th last, including the details of the secretive signature bonus.

Opposition Leader Bharrat Jagdeo later charged that the agreement was kept hidden because of the enshrining of the bonus, which was paid into a “secret account” at the Bank of Guyana.

Jagdeo also said that the contract exposed the false claims by the APNU+AFC government that a clause inserted in the Petroleum Act by the PPP/C and national security concerns, prevented its disclosure.

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