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Lindquist report on Piarco Airport: FRAUD!

Newsday broke the story on Nov 28, 2001
Reproduced by consent of Newsday.

The Lindquist report on the Piarco Airport - Editorial Nov 30, 2001
Update: LINDQUIST REPORT: $496M to one company Dec 04, 2001
NIPDEC estimated $92M but $183M contract Dec 6, 2001

Robert Linquist The Robert Lindquist forensic interim report into the award of contracts for the $1.426 billion Piarco airport development project has found that the project was a fraud on the public of Trinidad and Tobago, and a clear abuse of public funds.

The single, most egregious manifestation of an act of corruption by any Government of Trinidad and Tobago is the Piarco terminal.

This is true whether viewed from the standpoint of its brazenness, being high profile and ever conspicuous, in the obscene amounts of misdirected monies involved or in the enormity of the lies constantly fed to us in its defence by the high level officials involved.

The Newsday precis (Nov 28 page 3) of the Robert Linquist forensic interim report is a further clear and timely reminder of this if any were needed by anyone with eyes to see and sense to think. That the Prime Minister has had this report since last December without taking any action (or even announcing that he has it) is as equally instructive as the report itself. Obviously, in the face of the report's conclusions and findings the Prime Minister had an overwhelming obligation to act. That the Government or any of its members could commit such an illegality as the Piarco affair on the population and offer itself for re-election is, at once, a reflection of its amorality, its defiance of the norms of acceptable conduct and our generally immature level of politics or, at least, knowledge of how democracy works / is supposed to work. The Piarco contract is a clarion call for us at once to correct this gaping lacuna.

Under a properly functioning democracy, beholden to a Constitution, the scam that is the Piarco terminal could hardly have been perpetrated on the population and, by the slight chance that it had, those involved both in Trinidad and Florida would by this time have long been facing the courts on serious criminal charges.

The Lindquist Report on the Piarco Airport Development project now establishes the enormous, indeed unbelievable, extent of corruption involved in this scandalous affair. Ever since Justice Deyalsingh had pronounced on the illegality of the original contract and the country's engineers had condemned the non-tender award, the project had acquired a certain notoriety which grew as the work progressed. Still, what has now been revealed to us as a result of the investigations of forensic investigator Robert Lindquist amounts to a horror story beyond anything we had imagined. To begin with, this project makes history as it is the first to be conceived not simply as an effort to provide the country with a required facility but more so as a tremendous opportunity for plunder, for the exorbitant enrichment of friends and supporters of Mr Panday's government.

As Mr Lindquist points out, the selection of Northern Construction (owned by Mr Ish Galbaransingh) for a new contract following the suspension of Construction Package 6, as well as the selection of Northern following the bid process on two other contracts "were all the result of an original conspiracy to corrupt the contract selection process for the unjust enrichment of the 'players' and of defrauding the various state agencies of considerable sums." The shocking nature of this revelation is not easy to digest. It establishes a new and incredible dimension to corruption in the government, a deliberate, planned, well-calculated and cold-blooded design to use this mega-project as a device for systematically syphoning off millions of dollars into personal pockets. And it is clear from the number of "players" involved, the scheme must have had the co-operation of a wide range of participants both in the government and among the contractors engaged in the project.

According to the Lindquist report, the project began with six contractors and expanded eventually to 13 and the fraudulent schemes were perpetrated by the various parties throughout the entire contracting process. His investigations discovered such instances of fraud as price fixing and bid rigging; duplicate contract payments; false invoicing; defective pricing; co-mingling of contracts; conflict of interest; false representation; improper release of confidential information, product substitutes, tailored specifications and time limitations.

But if the level of fraud revealed in this project is absolutely shocking, it is equally amazing to consider that such a report was in the possession of the Prime Minister since January 2001, a full year ago, and he did absolutely nothing about it. In fact, Mr Panday continued to call on the critics of corruption in his government to "produce the evidence"! What more evidence did he want than what the Government's own hired international forensic accountant had provided his government? The Prime Minister's failure to act on this report, in light of his consistent refusal to appoint inquiries into a host of other corruption scandals rocking his government, is a serious indictment that must raise concerns about his moral fitness to hold office. His failure amounts to his condoning of this monumental fraud inflicted on the country for which taxpayers will have to pay hundreds of millions over the next 20 years. The PM's non-action is more troubling for the fact that he refused former AG Ramesh Maharaj funds for Lindquist to continue his investigations into other scandals and his assuming responsibility for two squads set up by the ex-AG, one of which was to assist the forensic investigator in his inquiries.

In scoffing at corruption in his government, did Mr Panday not think that the truth will come out?

The report, extracts of which were obtained by Newsday yesterday, said its findings were consistent with a conspiracy to corrupt the contract selection process beginning in 1996 and carried on throughout the contracting period.

Lindquist said that the ranking of Northern Construction as the top contractor for the construction of Package 6, the selection of Northern for a new contract following the suspension of Construction Package 6, as well as the selection of Northern following the bid process on two other contracts were all the result of an original conspiracy to corrupt the contract selection process for the benefit of Northern.

Newsday understands that the Lindquist report has been in the hands of Prime Minister Basdeo Panday since early December 2000, but no follow-up action was taken which would have enabled the investigation to continue leading to charges against a number of people.

The Lindquist report stated that there was a conspiracy to "corrupt the contract selection process for the unjust enrichment of the 'players' and of defrauding the various state agencies of considerable sums." It stated in part: "From all information received and from the examination of available records and documents, we have reasonable grounds to believe that fraudulent schemes were developed and promoted by the various parties throughout the entire contracting period." It listed 11 schemes which were uncovered as (1) price fixing and bid rigging, (2) duplicate contract payments, (3) false invoicing, (4) defective pricing, (5) co-mingling of contracts, (6) conflict of interest, (7) false representation, 8. improper release of confidential information, (9) product substitutes, (10) tailored specifications, (11) time limitations.

It stated that a group of individuals and companies conspired together to control the award of contracts on the airport project, and in one instance, two days before a contract was to be awarded the requirements were changed and only two companies of which Northern Construction was one could meet the requirements on time.

The project which began with six contracts, was expanded to 13 contracts and questions have arisen as to whether there was duplication in the contracts leading to the work being paid for twice.

The bid process that resulted in an award of a contract worth $183 million to a company named Calmaquip for the supply of specialty equipment for Piarco Airport development project was described as "flawed" by the Robert Lindquist investigations, the interim report of which is in the hands of the Government.

Lindquist recommended further investigation of the matter and raised questions about a deposit account held by the Airports Authority of TT in the Cayman Islands.

The $183 million, the report said was almost 100 percent higher than the budget.

The report further stated that the procurement plan for CP-13 which was awarded to Calmaquip, dated September 1999, stated that the "successful proponent will be responsible for the procurement, manufacturing and installation of the equipment, and will finance the equipment. Although the financial proposal of Calmaquip was scored 20 out of 20 by the Ministry of Finance, the CP-13 was financed not by Calmaquip, but instead by the Dresdner Bank Lateinamerika AG, Miami whose client is the Airports Authority of TT.

Their loan was backed by guarantees from both the EXIM Bank and the Republic of TT. The report quoted a Cabinet note of January 24, 2000, which stated that "the original cost of the project was TT$740,878,700 while the total final cost was estimated at TT$919,664,130 which sum includes all proposed construction, the accelerated programme, all Birk Hillman fees and NIPDEC's fees".

Lindquist remarked: "In the course of our review we found a complete lack of control over the disbursement of funds from the AATT to Calmaquip.

''Neither AATT nor BHC accept responsibility for ensuring the quality of the delivery of specialty equipment. The Manager Finance at AATT claimed not to be in possession of any bank statements of the loan, but has copies of individual debit notes pertaining to equipment deliveries. ''On the other hand he did provide bank statements for a deposit account of AATT that is located in the Grand Cayman. No Explanation was offered as to why this account was in Grand Cayman.''

The Lindquist Report found the Airport project was a fraud on the public of TT and an abuse of public funds.

Summons for former UNC ministers March 05, 2004

LINDQUIST REPORT: $496M to one company December 04, 2001

More on the report plus comments from the AG on the Trinidad and Tobago News Forum.

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