US25.1M, 2.3B Taxes Missing at CBL -LRA Internal Audit Wants CBL, Commercial Banks Provide Answers

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A leaked internal audit report from the Liberia Revenue Authority (LRA) Chief Audit Executive James Kerkula to LRA Commissioner General Thomas Nah Doe regarding an audit of Direct Transfer Payments at Commercial Banks covering the period 2017, 2018 and 2019 shows that the Central Bank of Liberia cannot account for US$25.1 million and LD2.3 billion representing taxes collected by commercial banks and remitted to the Government of Liberia’s (GOL) Consolidated General Revenue Account (CGRA).

According to the LRA internal audit covering 2017 – 2019, the intent of the audit was to ascertain the accuracy, completeness, reliability and validity of the amount of taxes commercial banks collected and remitted to GOL’s CGRA at the CBL in accordance with memorandum of understanding.

“Internal Audit planned and performed the audit to obtain sufficient and appropriate evidence to determine whether the amount of taxes remitted by commercial banks to GOL’s CGRA at CBL accurately and completely reflects the true and fair amount of taxes collected by the commercial banks for the period under audit,” the LRA Chief Audit Executive Kekula stated in his report to Commissioner General Doe dated August 26, 2020.

The Auditors obtained annual bank statements from commercial banks for the years 2017, 2018 and 2019 and CBL swift confirmation reports for all remittances made by commercial banks to the Central Bank of Liberia for the same period. The Auditors analyzed and reviewed all the bank statements for deposits received from taxpayers and remittances made to the Central Bank of Liberia. The Auditors also interviewed key management staff of commercial banks and the CBL for purposes of corroborating information gathered from documents and records of revenue transactions performed during the period under audit.

Based on the analysis and evolution of commercial banks’ statements, CBL’s swift confirmation reports and comparison with revenue data in LRA’s Tax Administration System (TAS) for the period under audit, the Auditors identified that revenue transactions amounting to US$2,043,813.75 and LD$327,130,712.16 on commercial banks’ statements were not captured in the 2017 CBL swift confirmation reports and therefore not reflected in GOL’s CGRA,” the report stated, revealing further that revenue transactions amounting to US$8,357,651.67 and LD$1,131,749,625.77 on commercial banks’ statements were also not captured in the 2018 CBL swift confirmation reports and therefore not reflected in GOL’s CGRA.

As for the 2019 audit, the Internal Audit showed that revenue transactions amounting to US$14,700,701.70 and LD$887,777,506.07 on commercial banks’ statements were not captured in the 2019 CBL swift confirmation reports and therefore not reflected in GOL’s CGRA.

Based on these gross financial discrepancies, the LRA Internal Auditors strongly suggested to LRA boss Doe that Central Bank of Liberia and commercial banks must be made to provide explanations for these irregularities (amounts reflected on commercial banks’ statements as remittances to GOL’s Consolidated Revenue Account at CBL but not reflected in CBL’s Swift Confirmation Reports and GOL’s CGRA) for purposes of accurately, completely and reliably accounting for taxes collected on behalf of Government of Liberia in accordance with memorandum of understanding.

The damning leaked LRA report comes in the wake of the recent mysterious deaths of three auditors from the same LRA. Mrs. Gifty Asmah Larma and Mr. Albert Peters, both of whom worked with the LRA as auditors, were discovered dead in a vehicle on Broad Street on October 2, 2020. Mr. George Fahnboto, another LRA auditor, was reportedly hacked on the head on October 4, 2020 by a machete-wielding assailant, causing him to lose control of his vehicle. Then on October 10, 2020 the Director General of the Internal Audit Agency, Mr. Emmanuel Barten Nyeswa, was found dead at his 72nd Paynesville compound under similar mysterious circumstances.

Speculations had been rife that the death of the four auditors had links with investigations that they were conducting on usage of the COVID-19 Stimulus Package funds.

Although President George Weah would later call on the government of the United States of    America to aid in uncovering the cause of the death of the deceased, and even commissioned an autopsy, the autopsy report is yet to be made public as the deceased have already been buried by their respective families.

It can be recalled that the President and Chief Executive Officer of the Institute of Internal Auditors, Richard F. Chambers, wrote the US Secretary of State, raising his concerns for the mysterious death of the four “auditors”.

“In addition to the short period in which these mysterious deaths occurred, all four reportedly were conducting ongoing audits of Liberia government accounts over allegations of misappropriations of funds…” Mr. Chambers informed Secretary Pompeo in a letter dated October 16, 2020, hoping that the US Government would seriously consider the request from the Government of Liberia.

Our reportorial team made several attempts to contact the LRA boss to provide clarity on the leaked Internal Audit report, but all efforts proved futile up to press time. This paper will however continue to contact the LRA, CBL and other named institutions as investigations continue.

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