IPNEWS: The Office of Inspector General, Global Fund Programs, is demanding the restitution of stolen monies into 75% fraudulent transactions under its grant to the government of Liberia, through the Ministry of Health.
According to a dispatch, the Inspector General’s office, in a bid to ensure the full restitution of the monies, has dispatched a team to Liberia, and will be holding a series of meeting with Finance Ministry officials, the Ministry of Health, and will pay a courtesy call on President George Weah.
On April 8, 2022, the Office of Inspector General, Global Fund Programs, reported widespread corruption of its funds by officials of the Ministry of Health, particularly the National Aids Program, and the Malaria Control Program, among others.
The investigation by the Office of the Inspector General discovered systemic fraud and misappropriation by the staff of the Liberian Ministry of Health (MoH), a grant Principal Recipient. We found non-compliant expenditures and/or various types of wrongdoing in 91% of the expenditures reviewed. Non-compliant expenditures totaled US$1.1 million.
The staff of the National AIDS Control Program conducted fraudulent procurements of vehicle repairs and advertising services. No assurance could be provided over program delivery in 75% of MoH field activities that we reviewed, and the MoH overcharged for daily subsistence allowances and misused grant funds by providing incorrect allowances and catering expenses.
MoH controls, policies, and oversight to mitigate fraud and misappropriation were either insufficient or did not exist. The Global Fund has implemented internal controls to address this issue, and further controls will be implemented as a result of this investigation.
The Global Fund’s Fiscal Agent did not adequately mitigate the risk of fraud, and engaged in conflicts of interest and misappropriation, including accepting grant funds for DSA and fuel coupons for activities that did not take place.
The Global Fund Secretariat was aware of fraud red flags and other wrongdoing in MoH-managed grants from 2015 but did not report the matters at issue in this investigation to the OIG.
The Global Fund has repeatedly vowed to recover stolen monies amounting to nearly US$ 1M from all entities, including the Ministry of Health, that were allegedly misapplied for the combat against Tuberculosis, Malaria, HIV/AIDS in the post-conflict nation.
Based in Switzerland, Geneva, The Global Fund is a partnership designed to accelerate the end of AIDS, tuberculosis, and malaria as epidemics. As an international organization, the group mobilizes and invests more than US$4 billion a year to support programs run by local experts in more than 100 countries.
The Office of its Inspector General report furthermore stated that the alleged conflict of interest, procurement fraud, overcharging for services rendered, concealing improper payment of fuel taxes, systemic fraud, and misappropriation, among others.
The OIG is responsible to safeguard the Global Fund’s assets, investments, reputation, and sustainability by ensuring that it takes the right action to end the epidemics of AIDS, tuberculosis, and malaria.
Through audits, investigations, and advisory work, it promotes good practice, enhances risk management, and reports fully and transparently on abuse.
In a recent report released following the conduct of an investigation by the Office of the Inspector General (OIG), the group unearthed fraudulent practices and waste of donors’ funds of about US$1.1M, but called for the restitution of about US$900,000.
In its findings, the group reported that the amount of US$0.52M in grant funds was wasted or misused for the mother peer program and travel-related costs, while non-compliance with policies, insufficient controls, and a lack of oversight has led to no assurance over program delivery in 75% of cases reviewed, totaling US$0.4M.
It reported that there was also a procurement fraud totaling US$0.19M for vehicle repairs and advertising services due to non-compliance with policies, insufficient controls, and the lack of oversight.
According to the report, the Ministry of Health “concealed improper payments of fuel taxes of at least US$0.16M, adding that, “MOH controls, policies and oversight were either insufficient or overridden”.
The report pointed out that the Fiscal Agent oversight was ineffective, and its personnel “engaged in conflicts of interest and misappropriation of grant funds, while Global Fund Secretariat did not report fraud and other wrong doing to the OIG.
Actions
Responding to the report following the release of its findings, The Global Fund pointed out that its Chair on the Recoveries Committee will pursue all entities involved with the fraudulent financial scandal to recover the money from now to October 31, 2022.
“The Global Fund Secretariat will finalize and pursue, from all entities responsible, an appropriate recoverable amount. This amount will be determined by the Secretariat in accordance with its evaluation of applicable legal rights and obligations and associated determination of recoverability”.
It noted that based on the findings of the report, The Global Fund Secretariat will ensure that the Principal Recipient and Cardno Emerging Markets USA Ltd. take appropriate action toward the individuals responsible for the prohibited practices described in this report from now to October 11, 2022.
“The Secretariat shall perform a cross-functional fraud risk assessment for Liberia which is consistent with the Global Fund’s Policy to Combat Fraud and Corruption (PCFC) and devise a solution that balances fiduciary risk with the delivery of programmatic objectives. In the interim, the Secretariat shall update the risk and assurance plan to consider the prohibited practices and non-compliant expenditures identified in this investigation, including ensuring that relevant Global Fund and PR policies are updated as required”.
From now to December 31, 2022, the group pointed out that its Secretariat will conduct a review of Liberia Principal Recipients’ compliance to their obligations under the Global Fund Grant Regulations and Budgeting Guidelines for the NFM, grant implementation period in relation to their tax exemption status b. Assess that the Liberia Principal Recipients have measures in place to ensure compliance with the relevant Global Fund guidelines and regulations on taxes in NFM 3.
“In consultation with the OIG, the Secretariat shall enhance its exception management process to roll out a robust incident reporting process for fraud, prohibited practices, and other wrongdoings identified as a part of its risk management and grant implementation monitoring processes. This mechanism shall establish a clear overview of roles and responsibilities amongst the key stakeholders from the Secretariat and key assurance providers like the LFA, Fiscal Agent and Fiduciary Agents and External Auditors”.
Conduct risk-based sample review
The Global Fund further assured that before the end of this year, its Secretariat shall commission a risk-based sample review of the MOH expenditures for both the HIV/TB and Malaria grants for NFM2, to identify the scale and scope of further non-compliant expenditures and red flag indicators of fraud and other wrongdoing.
The report disclosed that the Secretariat “shall recover the amount of non-compliant expenditures identified by the reviewing party in accordance with applicable legal rights and obligations and associated determination of recoverability”.
The probe launched by The Global Fund came as a result of suspected fraud and other wrongdoing reported at the National AIDS Control Program (NACP), a Global Fund grant implementer under the Ministry of Health in January 2020.
In response, the OIG opened an investigation, undertaking a field mission to Liberia in November 2020. The OIG also obtained digital copies of payment vouchers and other records and verified vendors.
Due to pandemic-related travel restrictions, the OIG conducted interviews with MoH staff by videoconference. During the investigation, the Global Fund’s Liberia Country Team and the MoH reported additional suspicions of fraudulent documents identified by the Fiscal Agent. The scope of the OIG’s investigation was expanded to include a review of these documents.
The OIG reviewed the expenditures for goods and services for which irregularities were reported, as well as a sample of additional expenditures. 347 MoH payment vouchers totaling US$2 million fell within the scope of the investigation.
The MOH has welcomed the report released by the Global Fund but, said the Ministry does not agree with everything that has been reported.
In a statement released a few days after the release of the report, the MOH justified that it is “impossible” for Global Fund to report that about US$990,000 from grants provided to the ministry has not been accounted for.
“Though we do not agree with everything in the report, the Ministry wishes to assure the public that it is giving significant attention to the allegations of fraud and misappropriation. As the report implies, significant measures have already been taken to mitigate some of the risks identified”.
The ministry has launched an investigation into the report released by Global Fund. But with the lukewarm and hasty justification provided, it remains unclear whether or not the probe, which is being conducted by some of those accused or linked to the fraudulent acts, will be impartial in a bid to ensure that donor funds which were entrusted to the Liberian government, through the Ministry of Health were adequately used for the purposes intended, including to combat against TB, Malaria and HIV/AIDS in post-conflict Liberia.
Already, Liberia is experiencing a shattered healthcare delivery system.
Shortage of essential medicines, lack of ambulance ( or compelling citizens to purchase fuel for ambulance service before taking ill relatives or loved ones to the hospitals), and lack of sophisticated medical equipment are challenges that are visible at almost all the public health facilities across the country.
