SOLOMONS AUDIT FINDS $1.6 MILLION FRAUD

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By Ofani Eremae

HONIARA, Solomon Islands (Solomon Star, June 27) – Solomon Islands Civil Aviation officials used AUD$2.2 million (SI$11.5 million) [US$1.6 million] of public funds between 1998 and 2003 for questionable and unidentified purposes, an audit uncovers.

This shocking revelation has prompted an Australian Government minister to order an audit performance of Airservices Australia’s contractual arrangement with the Solomon Islands Government.

Airservices Australia collected the funds, for the use of Solomon Islands airspace by foreign aircrafts, and remitted it to the Government.

But the Auditor General’s Office, which completed an audit of the Civil Aviation Division recently, says it had uncovered fraudulent use of these funds.

Auditor General Floyd Augustine Fatai said yesterday he was not in a position at this stage to divulge any information contained in his report.

However, he said he was very concerned at the magnitude of the seemingly fraudulent activities perpetrated by civil aviation officials in the use of the funds.

"This very significant amount of revenue was used for very questionable purposes or for reasons we have not able to identify.

"For instance, more than SBD$1.6 million [US$229,600] were used for unidentified payments. This does not include other identified but questionable payments," Fatai told the Solomon Star yesterday.

He added that it saddens him that whilst the rural people are suffering from lack of delivery of essential services in the past, public funds have been subjected to abuse and misuse by a handful of people.

The Auditor General said he feared that some of those responsible might likely to find their way back into the system through the Government’s current recruitment process.

The Solomon Star understands that some of the Civil Aviation officials implicated in this scandal have been terminated, but were never charged.

Fatai said he welcomed the Australian Government’s request to the Australian National Audit Office to conduct the performance audit into the contractual arrangement between the Solomon Islands Government and Airservices Australian

Airservice Australia administers the contract with the Solomon Islands Government for the use of the country’s airspace.

Under the contract, Airservice Australia provides air traffic control flying over the Solomons, and collects fees for this service.

Until late 2003, a set amount was remitted monthly to the Government’s general revenue and the balance was retained in an Airservice Australia account for use as directed by the Solomons government for aviation purposes.

Australia’s Minister for Transport, Warran Truss, who ordered the audit of the administration of the contract, said yesterday he wanted to know whether the highest stands of Australian financial accountability were exercised under the contract.

"I was advised that between 1998 and 2004, contract payments totaling SBD$2.2 million [US$1.6 million] were made for air travel, airport maintenance, training, equipment purchases and consulting services.

"Airservice Australia made these payments on the specific request and with the specific approval of the relevant Government Civil Aviation officials.

"But the payments were not made strictly in accordance with the contract," Truss says.

The payments have since been ceased in 2003 following a review by Airservice Australia.

Truss said internal and external investigations conducted to date have identified that Airservice Australia and its staff acted in good faith in administering the contract.

Fatai said he will present his report on the Civil Aviation Division to the minister responsible this week.

June 28, 2006

Solomon Star: http://www.solomonstarnews.com/

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