CMU council chair resigns ahead of Samuda statement

CMU council chair resigns ahead of Samuda statement

Senior staff reporter

Tuesday, January 21, 2020

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EDUCATION Minister Karl Samuda, whose portfolio has over the past several days been rocked by the damning findings of a special audit report on Caribbean Maritime University (CMU) and the ministry itself, will deliver a highly anticipated statement in the House of Representatives today.

Samuda told the Jamaica Observer yesterday that he will apprise the House of the measures the education ministry will be taking in relation to the CMU council going forward, following yesterday's resignation of its chairman, Hyacinth Bennett. Her resignation took immediate effect.

Bennett has walked away from the position in the wake of findings of poor governance practices; breach of human resources policy; unsupported, multimillion-dollar payments; procurement breaches totalling, in addition to other sums, close to half a billion United States dollars; and weak internal controls that enabled the improper transfer of $145 million from the CMU's accounts to the Jamaica Maritime Institute Trust Fund, according to the auditor general's report.

“We had a discussion today and at the end of it she came to the conclusion that, in the interest of everything going forward, she should resign,” Samuda told the Observer yesterday.

The board comprises 20 members, including the now-resigned chairman. Ex-officio members are CMU President Professor Fritz Pinnock and deputy president (now acting President) Ibrahim Ajagunna.

There are also reports that at least one other member of the council has resigned, but the minister said he had not received a letter from the individual up to yesterday evening. The CMU board was transitioned to a council in late 2017, when a name change from the Caribbean Maritime Institute to the CMU was effected via legislative amendments.

According to the auditor general's report, the CMU president “made decisions that undermined his fiduciary responsibility... The president acted unilaterally in the engagement of employees, consultant and an advisor by not obtaining the council's approval in keeping with the CMU Act”.

Pinnock, who is now facing criminal fraud charges, came under pressure for several months as he faced questions regarding CMU expenditure and operations from the Public Administration and Appropriations Committee. His testimonies at this parliamentary committee followed the ejection of former portfolio minister, Ruel Reid, from the Cabinet, and the emergence of adverse details regarding multimillion-dollar contract arrangements at the CMU.

The former minister himself is facing criminal charges, including breaches of the Corruption Prevention Act, conspiracy to defraud, misconduct in a public office at common law, and breaches of the Proceeds of Crime Act.

On Christmas Eve, the Supreme Court rejected an application for leave to apply for judicial review by Reid and Pinnock, challenging the criminal charges filed against them by the Financial Investigations Division. The attorneys of the accused filed the application in October seeking to nullify the charges.

Auditor General Pamela Monroe Ellis said in her report that the CMU's council failed to implement required systems to facilitate periodic, independent audit reviews, did not develop adequate internal controls, and did not have in place a functioning audit committee and an internal auditor.

“This also deprived the council of independent audit assurance to assist in its oversight responsibilities,” the auditor general said. She also pointed out that the auditors found no evidence that the portfolio ministry demanded periodic reports, in keeping with the corporate governance framework for public bodies and the Public Bodies Management Accountability Act.

Monroe Ellis said the council should establish a robust internal control risk management system to reduce the risk of losses and regulatory breaches, and that steps should be taken to strengthen control over the CMU's bank accounts: “Furthermore, the council should consider the appropriateness of maintaining 22 bank accounts — which presents an administrative challenge to effectively monitor transactions across accounts.”

The auditor general said the CMU council should immediately review its procurement practices to ensure, among other things, that opportunities are open to all eligible suppliers and contract management systems.

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