Financial Irregularities Uncovered At Central Bank of Liberia, Says GAC Report

Oluwasegun SanusiJuly 26, 20242 Mins read356

The General Auditing Commission has released a compliance audit report showing massive financial irregularities at the Central Bank of Liberia (CBL) covering January 1, 2018, to December 31, 2023.

According to reports, several non-compliance issues have been brought to the fore by the audit, all of which negatively impact the bank’s operations.

GAC found that CBL management exceeded approved expenditure limits by approximately $19.31 million from Fiscal Year 2018 to 2022. Approved expenditure projections of the budget outpaced revenue projections, another chronic pattern of deficit financing.

It was reported that the management of CBL cashed numerous checks across the counter in violation of regular banking principles and practices.

Included among the transactions were an $8,500 payment to Vision Pro and $8,000 to the West Point Youth Association. Institutional checks must be deposited, not cashed directly.

The report disclosed unauthorised funding activities wherein on November 30, 2023, a disbursement of USD 50.2 million to the Government of Liberia’s payroll account and another USD 32.85 million on December 23, 2023, were disbursed without legislative ratification in violation of Article 34 d iii of the 1986 Constitution of Liberia and Section 46.2 of the CBL Act of 1999. Moreover, approval from the CBL Board of Governors could not be provided.

The audit discovered massive mismanagement of non-performing loans to separate staff to the tune of $472,053 and $240,634.80 for personnel seconded from other government agencies.

The notable defaulters are Augustine K. Ngafuan, the former Finance Minister, who owes $5,091.29, and Sinoe County Senator Crayton O. Duncan, who is indebted to the amount of $44,924.43.

According to the GAC, no repayment, no legal action was instituted to recover these loans, and no documentation to support such defaults.

The report raised concerns over alleged money laundering, stating that CBL made facilitation for payments amounting to L$1.946 billion and $178.33 million above threshold limits that were approved to institutions under individual names.

These vast payments included huge amounts to the National Security Agency of $121 million and the Executive Protection Service of $23 million.

The audit revealed that $742,120 in legal fees was paid to employees to make subsequent payments to consultants, yet the CBL maintained an in-house legal department and engaged contracted legal firms.

Also, unsolicited payments above the approved payment amount, including $1,084,027 for Corporate Social Responsibility.

The review revealed that $11.08 million had been awarded in contracts non-competitively, with inadequate procurement documentation, where no bid evaluation reports or contract award notices existed.

The GAC has indicated that the operations of the CBL did not adhere to the 1986 Constitution of Liberia, the Public Procurement and Concessions Act of 2005, and other relevant regulations.

The GAC has called on the House of Representatives and the Liberian Senate to consider implementing the report’s recommendations in haste.

Read more;