By RASHAD ROLLE

Tribune Staff Reporter

rrolle@tribunemedia.net

AS many as 11 Bahamas Power & Light (BPL) employees allegedly helped facilitate a scheme that defrauded the company of nearly $2m, Ernst & Young (EY) concluded in its audit of BPL.

It’s not clear investigators found all 11 employees to be active participants in the scheme, but at least four of them have been fired from BPL since the investigation’s launch.

The 11 employees facilitated the fraud by recording, printing, signing and vetting fraudulent cheques or invoices, signing cheque registers for fraudulent cheques, creating fictitious vendors, putting their signatures on fictitious invoices and facilitating concealment of the fraud.

During EY’s interview with one of the employees, now fired, the person “became agitated and suggested that ‘Everyone is trying to get money out of BEC.’

“When pressed further,” EY noted, the employee “alluded to politicians and senior executives who are benefiting personally from BPL. She refused to provide further details, however.”

The highly anticipated audit obtained by The Tribune details how an internal investigation which began when an employee discovered an “unusually large invoice” from an “unfamiliar” vendor mushroomed into one that involved the government hiring Ernst & Young, the firing of several BPL employees and an ongoing Royal Bahamas Police Force (RBPF) investigation.

Investigators said they observed no evidence suggesting BPL’s chief financial officer was involved or knew about the fraud scheme. She told investigators BPL has made progress since accepting her position in 2009, saying the “control environment is adequate but could be enhanced”.

EY “identified 41 cheques totaling $1,886,525 made to 13 fictitious vendors and three cheques totaling $126,779 made to legitimate vendors” during its investigation.

“Based on our analysis of the documentation available, the evidence supports that a fraud was carried out by means of collusion between multiple BPL employees and at least one (bank) employee,” the accounting firm alleged.

Investigators found at least three of the employees had fraudulent documents in their work area. Investigators also determined three of the employees knew the primary bank employee allegedly involved.

One of them initially denied knowing the man but later told investigators she tried selling him jewellery and lingerie “from her side business”.

In fact, the employee received an email from the man on March 21, 2017. He requested she “print and forward” his invoices to a manager. That manager is among the 11 people who allegedly helped facilitate the fraudulent scheme. At one point he, in an email EY obtained, received a message from a former high-ranking official of BPL who informed that “he’s holding on to (his Mercedes SL class) for now” and the pair should “discuss cash for the Jet Boat.” The revelation, while not appearing to be directly related to the fraud scheme, paints a picture of people awash in cash.

Among the eyebrow-raising findings, investigators found three of the allegedly fraudulent cheques “were negotiated at the bank on the same day they were printed.”

“This,” the firm said, “suggested that someone within the Accounts Payable Department was able to take cheques that were printed and provide them to someone they were colluding with in order to be negotiated at the bank prior to 3pm when the bank closes.”

EY reviewed time sheets and badge swipe information on the dates the cheques were printed to determine who may have been involved in the scheme. The firm found irregularities relating to two employees.

One of the two employees “did not clock in or out for work” on March 24, 2017, EY said, adding: “However, his badge was observed moving in and out of the AP (Accounts Payable) Department throughout the day. This is highly irregular as it suggests he was in BPL offices but not there for work.”

The same employee, on April 20, 2017, “badged out at 2.34pm and did not badge back in until 3.40pm.” The employee “did not clock in or clock out on this date; he was on vacation.” “This is highly irregular as it suggests he was in BPL offices but not there for work,” EY determined.

The other employee “clocked in to work at 8.42am” on March 30, 2017, but did not clock out. The employee’s “last badge swipe was leaving” the Accounts Payable Department at 11.57am.

“Further, no e-mails were sent” by that employee on that date, suggesting to investigators that the employee “left work at 11.57am and did not return.” The same employee had a fictitious business licence certificate and National Insurance Board registration in his desk for “Scuderia Electrical,” a fictitious vendor. The employee was also found to have had in his work area several fictitious invoices that had been sent to the National Emergency Management Agency (NEMA) involving landscaping services after Hurricane Matthew.

An email from the employee to his brother appears to have the raised suspicion among investigators. The employee wrote to a relative on February 9, 2017: “Bro, tell me what you want to bid on at RBC and my ppl will make sure you win the bid. We pay them for the winning bid.”

The signatures of two employees were found on nine cheques totaling $249,859. But in an interview, the two employees “admitted to vetting only one of the fraudulent cheques” and “disputed vetting the other cheques which appeared to have their signatures.” The women “argued that the signatures appeared to be printed or stamped on the documents due to the consistency and similarity of the signatures”.

Three employees, including two managers whose grid stamps and alleged signatures were found authorising fraudulent invoices and certificates of payment, “denied having signed” the documents, according to EY. The investigators observed that in relation to one of those three employees – a person not listed among the 11 who allegedly helped facilitate the fraud – there was a discrepancy between the grid stamp on fraudulent invoices and the grid stamp impression “collected from his work area or observed on legitimate invoices that he authorised”.

EY found one fired employee who inputted 25 of 44 fraudulent cheques that totaled $1,441,460. The same employee created “six of the 13 fictitious vendors” as part of the scheme.