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Auditor general uncovers corrupt practices, nepotism at Petrojam

Wednesday, December 05, 2018

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KINGSTON, Jamaica — The controversy surrounding State-owned oil refinery Petrojam has drastically deepened, following the release of a report by the Auditor's General Office yesterday on its operations and that of the Petroleum Corporation of Jamaica (PCJ).

Auditor General Pamela Monroe Ellis said a comprehensive audit was commissioned following public concerns regarding mismanagement at the State-owned entity.

She said the audit revealed a number of deficiencies to include a number of corrupt practices and several instances of nepotism at the entity.

A brief perusal of the audit by OBSERVER ONLINE revealed that the entity ran into hundreds of millions of dollars in losses due to bad management practices.

The auditor general's findings, which were tabled in the House of Representatives yesterday, revealed high levels of accountable and unaccountable oil losses, instances of management overriding procurement guidelines, poor management of capital investment projects and consultancy arrangements, inconsistent recruitment and employment practices, and inadequate oversight and monitoring of Petrojam operations.

The audit further revealed that Petrojam's management gave approval for the hosting of two birthday parties, which were of a personal and private nature, to the tune $2.6 million.

It was also noted that the value of donations doubled from 2013 to 2014 and 2017 to 2018 with the largest year-on-year increase of 141 per cent coming during the last two years, when donations totalled $84.2 million in contrast to $34.9 million in 2016 to 2017.

The entity also exceeded donation budget in 2015 to 2016 and 2017 to 2018 by 33 per cent and 47 per cent respectively, without the approval of management.

As it regards to recruitment practices by the entity, it was revealed that two individuals who are closely connected to employees of the State-owned oil refinery were given employment contracts even though they were rejected by the interviewing panel.

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