The shady and mysterious operations at the Urban Development Corporation of the T&T (Udecott) is in no way close to being unravelled. A Sunday Guardian investigation revealed that the mess continued after the resignation of former executive chairman Calder Hart, and mere weeks before the May 24 general election. The investigation unearthed that shady deals, botched contracts and flawed tendering procedures have left the State-owned company in a sinking hole of debt amounting to a whopping $7.7 billion–set to be a big drain on the treasury. The billion-dollar debt reflects the company's loan portfolio for private sector financing at the end of February of this year.
Official Udecott documents obtained by Sunday Guardian showed that government-guaranteed loans granted from several financial institutions during the period between 2008 to 2009 were borrowed to fund several Government projects and for the payment of contractors. However, in some instances the former government failed to upkeep the agreement with the lending facilities accruing millions of dollars in interest. In fact, financial documents showed that on June 4, 2008 Udecott took a government-guaranteed loan from First Citizens Bank (FCB) for the sum of $320 million. The loan, as stated, was listed to cover various projects an agreed to be repaid in December 2009 by Government.
However, Udecott did not meet its deadline to repay the loan but made payments of $30,000,000 in interest on the loan facility. But, Sunday Guardian investigations revealed that the huge debt is only partly to blame for the messy and sticky operations occurring at the company even after the old board was fired in March of this year. And the two senior executives–business and operations manager, Ricardo O'Brien, and human resource manager, Nadya Yarsien–who were suspended after they were allegedly caught on camera photocopying important documents, were said to be targets in the pond as sensitive information continues to be leaked.
Mysterious practices at Udecott
So why hasn't the mysterious operations not ceased at Udecott after Hart tendered his resignation and fled the country? Well-placed sources said, it seemed that a hand or hands kept pulling the strings behind the scenes, continuing in almost the same manner as the operations which failed to adhere to proper practices. Investigations showed that for a certain company-the preferred choice by the former administration and who continues to adorn the PM's residence with weekly floral arrangements costing approximately $8,000–has been operating without a contract.
Investigations further revealed that audited statements for 2007 have not yet been signed off as there have been concerns raised by a reputable accounting firm, while the 2008/2009 accounts are now being hurriedly prepared to be audited. Financial institutions have been asking for audited financial statements from Udecott. Meanwhile, current financial accounts for 2010 are still outstanding.
"In addition, an issue was raised surrounding the award of the Parkade contract to (company names) after the company received $350,000 plus vat since November 2009 and no one has seen the award letter stipulating the amount to be paid," a Government source said.
$50 million pre-election pay out
Prior to the May 24 general election, the Government source said, hefty payouts were made to big contractors and a $5 million cheque was collected by a certain contractor on the morning of the election. The payouts were made possible, the source said, via a $100 million loan granted by First Citizens Bank ten days before election. Payments amounting to $50.6 million was paid out to six large contractors weeks before the election–with the largest payment to one contractor being $18.6 million. Udecott's small contractors, meanwhile, were told there was no funds.
Queries surrounding Udecott's bank accounts
Sunday Guardian also learnt that queries have been raised surrounding the use of Udecott's Projects and Facilities Management bank account at Citibank. The administrative expenses account at FCB was set up for use of operating expenses only. However, documents showed that the short-term loan that was received in May 2010 from FCB was credited to this account. "A portion was transferred to Citibank and the majority still remains at FCB. Project payments are now being made from both accounts." In May and June, this was being used to credit payments directly to the accounts of contractors. Cheques from the FCB account were also being used to pay contractors.
LEFT: Jearlean John
Jearlean: I have nothing to gain
Stating clearly that she had nothing to gain by defending Udecott, chairman of Udecott Jearlean John yesterday did not admit or deny if the company was in debt. However, John said, Udecott borrowed loans for clients. "Udecott was not borrowing money for themselves; when monies are borrowed it is borrowed for clients... Udecott does it for clients which are the various ministries." On the issue of accounts not being balanced, John said the company was still working with auditors.
"When you do accounts, queries will be raised and you have to go back and respond. This is done by a management letter and you now have to go back and answer queries... That is what Udecott is doing.
"The reason why accounts are not signed off is because the Government has changed. I met with Pricewaterhouse(Coopers), but the Government has changed and we are giving the new minister an opportunity. I am not making an excuse for the fact that the accounts for 2007 have not been settled, but these things also occur in the public service.Today (yesterday) is Saturday, but I am sure that on Monday the relevant persons will be able to respond to the necessary questions you need to be answered."
LEFT: Mary King
King in the dark
When contacted, Minister of Planning, Economic, Social Restructuring and Gender Affairs Mary King, under who Udecott falls, said she had absolutely no knowledge of the situation. "You are telling me stuff I have never heard of. How could I comment? I have never seen any accounts dated February 28, I will appreciate if you can forward your documents to me."