PNG Power: Where’s the money (part two)

By PNG Echo.

The Fraud Squad is either grossly incompetent or corrupt – there is no third way.

…companies related to Mr Tangit [CEO of PNG Power Ltd (PPL)]and his close relatives have received payment of K16 million from from PPL. Combined with the K15 million received from both the [East Sepik] Provincial (K10 million) and [Angoram] District Government (K5 million), it appears that Mr. Tangit and his close relatives have received K31 million through various entities for the period, 19 February 2009 to 30 September 2015.

As CEO of PPL, this represents a serious conflict of interests, even if that were all there was to it – but it’s not – the money has all been paid out, but as of October 2015 there was no evidence of even the commencement of the project referred to anywhere.

Highly confidential (and why’s that?)

The above quote was taken from a 35-page report marked ‘HIGHLY CONFIDENTIAL’ of which I am in receipt.

It was commissioned as a result of questions being asked in parliament as to why, when funds had been allocated and deposited by Members of Parliament into the coffers of PPL for the Rural Electrification Project (RE Project), these projects were not completed, were behind schedule or significantly over budget. It was the July 2015 session of parliament.

In response, on 15 September, 2015, the Minister then responsible, Hon Ben Micah along with Mr Garry Hersey Managing Director (MD) and Chief executive officer (CEO) of the IPBC and Mr John Mangos, then Executive Director of PPL engaged an Australian forensic investigation company to look into allegations of corporate impropriety at PPL.

Déjà Vu

I have read this report in detail, with a pervasive feeling of déjà vu: I’ve heard it all before: it was in different times and different places but a very familiar modus operandi.

It evokes the non-existent Wasa Bridge in Kandep, associated with Don Polye and the non-existent community colleges – a fraud for which the Grand Chief, Sir Michael Somare and certain members of his family have been implicated in the Singapore courts.

Coincidentally (or not?), the RE [non] Project also involves the Somares as the project was to be undertaken in the district of Angoram (Arthur Somare’s seat at the time) and involved the East Sepik Provincial Government.

The Angoram RE Project

It is the K15 million paid out to two contractors to which the report dedicates much investigation.

K10 million was from the coffers of East Sepik Administration that had been deposited by Sir Michael Somare into that account (it is not stipulated under what authority and from whence it came but the K10 million was earmarked for the project) and over K5 million that was received by the contractor from the Angoram District Administration for alleged variations to this non-existent project of which the investigators admitted finding no evidence  (and they looked)

The K10 million remained with the Provincial Government until the contracts to carry out the project were awarded and then it was transferred to PPL.

The report highlights the gross abuses of process that allowed vested interests to win the tendering process and commandeer the project without fulfilling the contract.

The tendering process

Implicated in just about everything – is John Tangit CEO of PNG Power whose ‘wantoks’ were the proprietors of the companies that won the four-part Angoram RE Project – three parts to PNG Engineering – the registered owner being Mr Richard Pii, brother-in-law of John Tangit and one part to Sepik Metal the registered owner being Mr Patrick Wolly Tangit, the brother of John Tangit.

The investigation team found evidence of John Tangit’s direct involvement with the tendering process on his desktop computer.

What’s more, these two companies seemed to have been made aware of the exact amount of money allocated for the project and their estimates coincided exactly (similar to insider trading). The three-parts of the project for which PNG Engineering won the tender were split into K3 million each, notwithstanding the very different parameters of each individual part. In other words the tender was neither accurate nor competent.

Further to the questionable estimates of PNG Engineering, the investigation teams noticed an assessment of 15/15 that had been awarded by the tenders’ assessment team to PNG Engineering for experience, a ridiculous score when the company was only five months old.

As for Sepik Metal, the other successful tenderer, they did not even gain the highest score in the assessment but got the contract because they came in exactly on budget – a little insider knowledge goes a long way.

As such, it could not be confidently asserted that either of these two companies were the best companies for the job regardless of conflicts of interest.

What’s more, on digging deeper into these two companies and their affiliates, many more links of John Tangit’s pecuniary involvement were uncovered.

John Tangit has been much more brazen even than Don Polye was when he awarded the Wasa Bridge contract to a crony – at least he didn’t ostensibly hand the contract to himself.

There’s nothing new here

Of the three issues, Wasa Bridge, Community Colleges and now the Angoram RE Project, there is nothing new.

In Kandep, an estimate K71 million has been allocated to the project and the contractors – and no bridge.

In 17 districts of PNG a whopping K156 million has been allocated and spent – and not one Community College to show for it. (“Leave the Grand Chief alone – he’s the Father of the nation,” you say– where’s that ironic font?)

In comparison, the K31 million gone missing from the Angoram RE Project is a mere bagatelle but a huge amount none the less in any context, but especially in one where many people exist on a couple of kina a day and women still die in childbirth at alarming rates through lack of governmental services (maybe in Angoram it’s from lack of electricity.)

This was brutally brought home to me recently when I heard that there was a drive to vaccinate potential mothers in PNG against tetanus. What on earth for?

In my world, tetanus is not considered a risk factor for birthing mothers. But it is where mothers habitually give birth on the ground in the dust and the dirt or the mud and the filth.

Yet here we are – talking of K31 million as if it were nothing – because everything is relative and the relationship of various acts of thievery is regularly and usually counted in millions in PNG.

To date, no one has found a way or a will to successfully prosecute these crimes. Why not?

Inadequacy of the agencies of the state.

For a journalist, once is an incident, twice is suspect and by the third time, it’s a trend.  And this mode of corruption is quite the trend in PNG. Yet it’s brazen, and not even particularly sophisticated.

What’s more, in two of these cases, there has either been a very competent Singapore court (Community Colleges) that has done the hard investigative work or a thorough investigation by a reputable independent investigator (Angoram RE Project).  As for the Wasa Bridge, if the authorities wanted some evidence of where to look – they could do worse than start with PNG Echo’s own investigation.

Yet it doesn’t happen, does it?  Why not?

If the agencies of the state, and the state itself, cannot recognise this brazen and obvious trend and put in place ways to successfully prevent and prosecute the crimes, then the agencies are either incompetent or corrupt themselves.

I find it hard to believe that in the PNG Power saga ,all Fraud Squad’s energies were put into prosecuting John Mangos for alleged visa infringements and an alleged K62,000 for which there was no viable evidence – Mangos would argue that it doesn’t exist – yet with all the credible evidence available to them – nothing has been done on the missing millions.

I re-iterate – the Fraud Squad is either grossly incompetent or corrupt – there is no third way.