A case alleging that State Electric Company limited (STELCO) spent its funds in advance to purchase dollar from a private company that does not hold the required license has been forwarded for prosecution against the procurement head and the former Managing Director of STELCO.
ACC’s investigation revealed that STELCO has spent MVR 3,084,000 in advance to purchase USD 200,000 from a private company that does not hold the required license to trade foreign currency. As per section 3 of MMA’s Monetary policy (01 March 1987), it is prohibited to purchase dollar from any party that does not hold the necessary license to trade foreign currency. Nonetheless, on 02 August 2016, STELCO’s Finance Department’s Head approved to purchase dollar from the forenamed private company, against MMA’s policies, while evidently the Procurement head’s job responsibilities include carrying out STELCO’s finance-related work in compliance with the government laws and the Company’s policies.
The Procurement Head stated that the forenamed private company’s credibility had not been checked, but rather assumed due to the presence of the Mauritius Commercial Bank’s bank guarantee stamp on the dated check issued by the Company under discussion. However, ACC’s investigation revealed that STELCO had not taken the necessary actions to validate the bank guarantee stamp on the dated cheque.
Also, the investigation revealed that prior to the check exchanges made to purchase the dollar, the former Managing Director of STELCO was aware that the cheque issued by the private company was postdated. Despite knowing this, the Managing Director assented to finance MVR 3,084,000 in advance to purchase USD 200,000 from the Company under discussion, without putting in any effort to validate the bank guarantee stamp on the dated cheques issued by them.
Moreover, the Finance Department head of STELCO had stated that the decision on purchasing dollar from the forenamed company was made due to the difficulty the Company was facing in obtaining dollar. However, documents reveal that in every instance where STELCO requested the Ministry of Finance and Treasury to obtain dollar, the Company had been issued the required dollar from Maldives Monetary Authority under a special approval provided by the President’s Office.
Consequently, the decision made by STELCO on funding MVR 3,084,000 in advance to purchase USD 200,000 from a private Company has resulted with the private Company being provided with an undue financial gain. The investigation reveals that this act was purposefully carried out by the Finance Department Head and the former Managing Director of STELCO to provide an undue advantage to the Company under discussion. Thus, the case has been forwarded to the Prosecutor General’s Office to be prosecuted under Article 513 of Law number: 9/2014 (Maldives Penal Code) and Article 12 (a) of Law number: 2/2000 (Prevention & Prohibition of Corruption Act) against the Procurement Head and the former Managing Director of STELCO.
Furthermore, as STELCO had financed MVR 3,084,000 as advance without validating the Mauritius Bank guarantee stamp on the dated cheque, STELCO was unable to obtain dollar in exchange of the finance disbursed by the Company as advance. However, since this money must be received by STELCO and as it is evident that the Finance Department Head and the former Managing Director of STELCO is liable to this loss, the case has been forwarded to prosecutor General’s Office to recompense the loss of MVR 3,084,000 from the Finance Department Head and the former Managing Director of STELCO.