Emails expose fraud at NCN Berbice branch

Jun 04, 2016 News

…Former employee diverted company funds to personal bank account –Forensic Audit report
A former employee of the National Communications Network (NCN) has landed herself in hot water as

NCN Berbice Branch Coordinator, Faizal Jaffarally

forensic auditors have discovered that she took more than $500,000 belonging to the company and transferred it to her personal bank account.
Based on a request by NCN’s Board of Directors, Harry Parmesar, Chartered Accountants, conducted a special investigation into this matter which took place at NCN’s Berbice Branch.
The forensic auditors noted in their report that the money was taken from an account called the “Assembly of Prayer”. It was set up for a customer based in Canada who made substantial periodic pre-payments for airing of Christian based programs during the period September 2012 to August 2013.
However, these payments were deposited to the Berbice Branch’s Administrative/Accounts Clerk, Ms. Tishti Gajraj’s personal bank account rather than in the bank account of NCN.
The auditors said that the customer was issued with unofficial invoices at higher rates than those normally charged by NCN. They said that official invoices at the lower authorised rate were prepared and recorded in NCN accounting records. The excess amounts were not paid to NCN
While the auditors conducted several discussions with various members of NCN, they were unable to do so with Gajraj. She was not available during the investigation. In spite of this limitation, the auditors went ahead with their perusal of statements dated September 26, 2013 and documents submitted by Gajraj.
The documents on the matter show that broadcasting of the programmes should have commenced on September 10, 2012. By email dated September 18, 2012, Mr. William Subryan, Treasurer of the Assembly of Prayer, requested from Gajraj, the Berbice Branch’s Administrative/Accounts Clerk and the complete name and address of NCN in Berbice to enable him to transfer payments for the airtime.
By way of email on the same day, Gajraj requested of Mr. Williams that the payments be transferred to her personal account and indicated that she will “do the necessary transaction”.

Former NCN Employee, Tishti Gajraj

The Treasurer replied the following day indicating that he cannot authorise Scotia Bank in Berbice to transfer payments to a personal account due to the money laundering laws in Canada and Guyana.
This did not matter to the NCN employee. She still insisted that Subryan make the payments to her personal account. He succumbed to her request and subsequently requested an invoice to make the transfer to Gajraj’s personal account.
The Forensic auditors noted that on September 24, 2012 an amount of $197,200 was transferred by Assembly of Prayer to Gajraj’s personal bank account at the Republic Bank Guyana Limited in New Amsterdam.
The following day, she withdrew all of the money from the account and subsequently prepared an invoice for the said amount and signed it for 17 “30 minute religious programmes” covering the period September 10, 2012 to December 31, 2012. It was noted that the unit rate calculated was $10,000 plus 16 percent VAT.
However, the cash invoice represented in the Assembly of Prayer books only had $127,920 as paid for 14 “30 minutes religious programme” to be aired during the period October 1, 2012 to December 31, 2012.
The unit rate used in this regard was $8,000 per programme plus VAT at 16 percent.
This simply meant that the Assembly of Prayer officials paid for three extra programmes that were not aired by NCN in September 2012.
This act was repeated once again by Gajraj covering the period January 7, 2013 to April 29, 2013. This time, the invoice sent to the Assembly of Prayer officials was authorised with the signature of Faizal Jaffarally.
Gajraj did not stop there. She overpriced the Canadian officials again for 17 “30 minutes religious programmes” to be aired during the period May 6, 2013 to August 26, 2013. It was noted that three transfers totalling $591,600 were made to her personal account.
The former NCN employee in a report to NCN in 2013 said that she was instructed by the branch’s coordinator, Faizal Jaffarally to inform Assembly of Prayer to make all payments to her personal bank account.
She said, too, that she was instructed by Jaffarally to quote Assembly of Prayer a unit cost of G$11,600 instead of NCN’s official rate of $ 9,280. Gajraj said that the amounts were withdrawn and handed over to Jaffarally. She was unable to substantiate that the excess money was ever repaid to Assembly of Prayer.
Jaffarally on the other hand claims that he only signed documents given to him by Gajraj because he thought it was a quotation and not an invoice. He indicated that the quotation was sent as a basis to negotiate the actual rate to be charged to Assembly of Prayer.
Further he claimed he only instructed Gajraj to charge Assembly of Prayer the standard rate of $8,000 plus Value Added Tax.
Forensic auditors noted however that while it is normal to send a quotation at the initial stage of negotiation, is not sent to customers who are already providing the service.
The auditors made it clear that the Assembly of Prayer commenced business with NCN since September 2012 and said it is therefore unusual that a quotation will be sent in January 2013.
The forensic auditing team nevertheless made a note of his claim that he was aware of the fraudulent transaction being carried out by Gajraj.
Based on the evidence gathered, the auditors are of the firm view that from the inception, arrangements with the Assembly of Prayer clearly reeked of intentions to commit fraud. The auditors also believe that there is sufficient evidence to prove that Jafarally was aware of the fraudulent transactions.
The auditors recommend that the Board of Directors at NCN considers legal actions against Jaffarally and Gajraj to recover the amounts overcharged to Assembly of Prayer. They said, too, that the internal control over invoices and cash collection should be strengthened while the duties of raising invoices and cash collection should be segregated.
The auditors said that the Internal Audit Department should carry out a detailed review of the Branch’s operations to confirm this was an isolated event and not a wide spread practice.
As Assembly of Prayer is aware of this matter, the auditors said that NCN’s management should meet with their representatives to provide assurances that this issue is being addressed.