Conclusion (1) – Analyse evidence

Conclusion: Analyse Evidence

NOTE: THIS PAGE HAS NOT YET BEEN WRITTEN FULLY. IT JUST CONTAINS SUGGESTIONS AND NOTES ON HOW THE INVESTIGATION CAN BE TAKEN FORWARD AT THIS CONCLUDING STAGE.

ONCE WE HAVE AGREED THESE ASPECTS, THIS PAGE CAN BE WRITTEN.

IT WILL PROBABLY BE BROKEN DOWN INTO SEVERAL SEPARATE WEBPAGES.

Course Narrative

Summarise findings to date on Procurement Issue:

Summarise findings to date on Variation Issue:

Summarise findings to date on Road Quality Issue:

The key players who appear to have been responsible for decisions and activities in relation to the above three issues are:

Minister (give reasons)
CEO of NRA (give reasons)
Project Engineer (give reasons)
Rapid Construction (give reasons).

They appear to have been aided in these outcomes by the following persons:

Procurement Director (give reasons)
Chair of Bid Evaluation Committee (give reasons)
Internal Auditor (give reasons).

When people act improperly, you expect there to be some reason for this. This reasons could be:

the receipt of money or other financial benefit
the hope of retaining or gaining employment, promotion or a contract
loyalty
fear.

Have these parties received any improper benefit in consequence of the above three issues?

Minister: Improper profits from the aggregate supply contract, which were used to buy a yacht and apartment.
CEO of NRA: Not yet known.
Project Engineer: Not yet known.
Rapid Construction:
- The award of a contract at what appears to an overvalue of [$3m] due to the apparent cartel and bid rigging (which led to the disqualification of a contractor who was $[ ] cheaper).
- The award of an improper variation which led to at least $[1m] in improper profit.
Procurement Director: Not yet known.
Chair of Bid Evaluation Committee: Not yet known.
Internal Auditor: Not yet known.

It is implausible that the above parties would have acted as they did without some reasons. It is important to try to identify such benefit or reason, as this is important for motive.

It is noted from the above that Rapid has received at least [£4m] in improper benefit, and it would have been unlikely to have achieved that without the support or acquiescence of all the above named parties. Could it have rewarded these parties using the proceeds of this [$4m] improper gain? We know that the Minister has received a considerable benefit in return for his support, but we do not yet know what benefit, if any, the other parties have received.

Consider what the next step shoud be. Then click Reveal.

REVEAL

It is suggested therefore that the next step would be to undertake a forensic examination of the bank records of Rapid, to see whether there are any unusual payments out of its bank account.

You therefore appoint accountants to undertake a forensic examination of Rapid’s bank records [need court order?].

Consider audits also of potential recipients bank accounts?

Course Materials: Accountant’s Report

[NOTE: THIS IS AN OUTCOME SUMMARY. WRITE ACCOUNTANT’S REPORT]

The accountant who audits Rapid’s records finds no evidence of direct payments to the above personnel by Rapid.

There is a possibility that payment may have been concealed through sub-contractors and suppliers, which would only be uncovered by an audit of the sub-contractors’ and suppliers’ records.).

However the accountant’s report finds an unusually large expenditure on entertainment by Rapid over the last two years, including:

almost weekly expenditure in excess of $1,000 per time at an exclusive club
airfares, tickets and hotels for four people over three days for the Monaco Grand Prix.

This is unusual expenditure for a contractor. There are no details of the recipients of this entertainment on the file.

The accountant’s report also identifies the purchase by Rapid of a $5,000 watch, which is unusual expenditure for a contractor. There are no details of the purpose.

Course Narrative

You follow up the accountant’s report by obtaining further information from the Club and Travel Agents by way of interview.

Course Materials

[NOTE: THIS IS AN OUTCOME SUMMARY. WRITE INTERVIEW REPORTS]

Club: You interview the Club manager. He confirms that Rapid’s CEO is a member of the Club and visits most Fridays with guests. When shown photographs, the manager confirms that the NRA CEO and Procurement Director frequently accompany the NRA CEO. He does not recognise photos of the Project Engineer, BEC Chair or Internal Auditor. The manager confirms that the bill for the Club is always paid by Rapid Construction.

Watch: You interview the manager of the shop where the watch was purchased. From their records, payment for the watch was made by Rapid Construction. They were asked to engrave a name on the back of the watch. This name was that of the NRA CEO.

Educational Materials: Gifts and Entertainment

[EDUCATIONAL NOTE ON GIFTS AND ENTERTAINMENT, AND WHEN THAT CAN CONSTITUTE BRIBERY ]

Course Narrative

[Comment on the above gifts and entertainment, and the high likelihood that it is corrupt.]

You believe that you now have sufficient evidence of improper behaviour to interview the relevant parties suspected of involvement.

You therefore undertake interviews of:

Minister
NRA CEO
NRA Procurement Director
Project Engineer
Chair of BEC
NRA auditor.

Summaries of these interviews are below.

Course Materials: Interview Records

Summary Notes of Interviews:

Minister: Refuses to be interviewed on basis that it is a political witch hunt.

NRA CEO: Asks to be accompanied by lawyer. Lawyer advises CEO to respond “no comment” to all questions.

NRA Procurement Director: Asks to be accompanied by lawyer. Same lawyer attends as for CEO. Lawyer advises Procurement Director to respond “no comment” to all questions.

Project Engineer: At first the Project Engineer denies knowledge or involvement in any of these issues. However, when shown the evidence that the Anti-Corruption Commission had, the Engineer changes tack. He states that he and his organisation received no improper benefits from anyone in relation to the project. They only received their payments under their contract with NRA for project design and management. However, he stated that it was always very clear in Rivera that if you wanted to act as engineer on any NRA project, you had to do whatever the CEO of NRA instructed you to do. Therefore, if you were told to issue a variation, you did so without question. If you were told to approve a payment certificate you did. Otherwise, your contract would be terminated and you would get no more work from the NRA. When challenged that this was an abuse of his powers and duties to act independently on the project, he stated “that’s not how it works in Rivera. I have a family. We have to do whatever is necessary, otherwise we have no work and no money.”

Chair of BEC: From the interview, it is clear that the BEC Chair has been appointed by the CEO of the NRA on the basis that the Chair is unquestioningly loyal to him, and will do whatever he says. The Chair seems to have the belief that the CEO is a good public servant who is trying to drive the development of Rivera forward, and that the BEC should not be an unnecessary obstruction to progress. The Chair seems unaware that she may be acting improperly or against the best interests of the NRA. It is either a good act from the Chair, or the Chair genuinely believes that nothing was wrong.

NRA auditor: From the interview, it is clear that the auditor has been appointed by the CEO of the NRA on the basis that the auditor is unquestioningly loyal to him, and will do whatever he says. The auditor admits that he has little experience of construction projects, and is not really sure what he is meant to be looking for. He says that his audit on the Central Highway was very limited, as the CEO told him that there was noting wrong with the project and that he should only undertake a limited audit. The auditor seems unaware that he may be acting in breach of his duties or against the best interest of the NRA. It is either a good act from the auditor, or the auditor genuinely believes that nothing was wrong.

Guidance

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Educational Materials: [ ]

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What do you do next?

Go to the next page so that you can undertake a final review of the evidence and decide whether you have sufficient evidence to prosecute, or whether you need to pursue further enquiries.

Page updated on 8th December 2024