Renewed hearings expose more irregularities at D.F.C.

The last three months have been tumultuous for the members of the D.F.C. commission of inquiry, but as News Five’s Janelle Chanona reports from the resumed public hearings, this morning Merlene Bailey Martinez and Herbert Lord reaffirmed their commitment to the task at hand.

Today the Commission of Inquiry investigating the financial affairs of the Development Finance Corporation began with a tearful tribute to former commission chair, David Price.

Merlene Bailey Martinez, Co-chair, D.F.C. Inquiry
“He desired leadership and accountability of the Government of Belize. He was prepared to give his life for this mission. We will not dishonour his memory by making the fruits of his labour come to no account.”

Herbert Lord, Co-chair, D.F.C. Inquiry
“I would ask for one minute of silence before we proceed.”

When the session continued, co-chair Merlene Bailey Martinez was firmly behind the wheel of what she promised would be an “interesting” journey.

Merlene Bailey Martinez
“We are not here to play politics with the people of Belize. We are here to conduct this inquiry and it needs to be done properly and in good time.”

The day’s first witness was Jane Longsworth, D.F.C.’s Manager of Finance and Internal Services. Longsworth recounted earlier testimony in which she questioned several corporate decisions, but no situation was more alarming than the fact that the board of directors …

Jane Longsworth, Finance Manager, D.F.C.
“ … For a while they didn’t have the notes and for a while they did not have the financials.”

Herbert Lord
“But they still operated and continued to …

Jane Longsworth
“Yes.”

Herbert Lord
“Isn’t this almost what you would call the lifeline, to know exactly what funds you have to deal with, how much you can give, how much you can approve? And if you are not doing this, you are operating, to my mind, in the dark.”

Jane Longsworth
“Well, it tells you if you are working at a profit or a loss if nothing else.”

Merlene Bailey Martinez
“This is a financial institution. Let us not forget that. And you are saying for an entire year the board did not receive financials.”

Jane Longsworth
“Right.”

Janelle Chanona, Reporting
“In her first appearance before the D.F.C. Commission of Inquiry, Jane Longsworth testified that she refused to follow instructions to book a fifty million dollar transaction.”

Jane Longsworth (August 24th 2006)
”I was given instructions to book it and given some documentation on which to base the transaction. But the documentation was not sufficient and so I refused to book it and I did not authorize that it be booked either.”

David Price
“Who gave you the instructions in the first place?”

Jane Longsworth
“Who gave me the instructions? Mr. Gabb, Mr. Troy Gabb. The document that I was given had to do with—that maybe it was about … they were entering maybe into an agreement to borrow fifty million dollars.”

Janelle Chanona
”Today another D.F.C. employee reported that she was asked to backdate the board minutes that dealt with that same transaction.”

In June 2004, Roselia Carmen Moore was acting as corporate secretary to the board when senior members of management, namely D.F.C.’s C.E.O. Troy Gabb and its legal officer, Ann Wiltshire, instructed her to sign a document that was dated March 2004.

Roselia Carmen Moore, Former D.F.C. employee
“The board indicated that a loan of fifty million dollars had been approved previously at some meeting where I wasn’t present and that due to an oversight it was never documented. That is my understanding, that this was never documented.”

Merlene Bailey Martinez
“Why did you sign for the eighteenth of March? On whose instructions?”

Roselia Carmen Moore
“On the instructions of the C.E.O., through the legal officer.”

Merlene Bailey Martinez
“The C.E.O., could you call the name of the C.E.O.?”

Roselia Carmen Moore
”Mr. Troy Gabb.”

Merlene Bailey Martinez
”Did Mr. Gabb directly indicate to you that he wanted you to sign that date?”

Roselia Carmen Moore
“No.”

Merlene Bailey Martinez
“How was it communicated to you?”

Roselia Carmen Moore
“Through the legal officer”

Herbert Lord
“Who was the legal officer?”

Roselia Carmen Moore
“Mrs. Ann Wiltshire.”

Merlene Bailey Martinez
“What did Mrs. Wiltshire say to you?”

Roselia Carmen Moore
“She said, “Carmen, in the absence of the acting corporate secretary, who at the time was on sick leave, Mr. Gabb says that you have to sign this document as acting corporate secretary, because these documents are urgent and they need to go to the Belize Bank.”

Merlene Bailey Martinez
“Did she explain to you why you had to backdate the resolution?”

Roselia Carmen Moore
“No.”

Merlene Bailey Martinez
“Did you ask why you had to backdate the resolution?”

Roselia Carmen Moore
“I did not ask.”

Merlene Bailey Martinez
“Did you have any concerns about backdating the resolution?”

Carmen Moore
“Well, since at the board meeting they had indicated that the loan had been approved previously, but that it was never documented, and having a legal officer who I took for granted that she knew exactly what was happening and would not be illegal, and she told me in the instructions of the C.E.O., I have to sign it because the corporate secretary is not available.”

Moore is no longer at the D.F.C., but she says even when she was making copies of the files to submit to the Commission of Inquiry, the minutes were still not confirmed by the board.

Carmen Moore
“When I realized that this was still hanging there …”

Merlene Bailey Martinez
“What did you do?”

Roselia Carmen Moore
“I took it out–I think by this time I had already resigned–I took out these minutes and a copy of the resolution and I guess the certificate and went looking for the C.E.O., Mr. Gabb but he was not available. So I handed to his secretary, Ms. Pott and I said, you know I have resigned from the corporation and I’m going home, but one concern I have is that I was not successful, Ms. Phillips apparently was not successful, and so I am giving you these documents to give to the C.E.O. and remind him that it is the policy of the corporation that all unconfirmed board minutes must be confirmed at board level”

Those minutes have apparently disappeared from the records of the D.F.C.

Herbert Lord
“Unfortunately we have asked for copies of it when we have had our own meetings. The forensic auditor has gone through it and that date, the seventh of March, seems to be a fantasy or a phantom because there are no minutes purportedly that any of us can come across”

Sidney Campbell, Governor, Central Bank of Belize
“We are bankers for the Government and for commercial banks, and for in this case, the D.F.C”

The third witness to appear before the commission was Governor of the Central Bank, Sidney Campbell. He testified that the D.F.C. erred when it disbursed thirty million dollars with cheques bearing “To the Alliance Bank for the Novelo group” and “To the Alliance Bank for Eugene Zabaneh”.

Sidney Campbell
“As to who the funds is for would never be our concern at the Central Bank, we are dealing with a bank to bank relationship, but writing that name on the cheque, obviously I can see why it would raise some concern. Because here is it that a cheque that’s supposed to be between two institutions, an individual’s name appears on it.”

Merlene Bailey Martinez
“There seems have been quite a few errors when it comes to …”

Sidney Campbell
“I could tell you that I researched the matter and this is the only two times that that error took place.”

Merlene Bailey Martinez
“When was the other time?”

Sidney Campbell
“The two times? It was one there for Novelo’s and one for Zabaneh.”

Merlene Bailey Martinez
“So we were making history here.”

Janelle Chanona
“The public hearings are scheduled to resume on Wednesday, Thursday, and Friday of next week with as many as eight witnesses called to testify. Reporting from the Belize Institute of management, I am Janelle Chanona reporting for News Five.”