Friday, November 15, 2013

Officials implicated in fraud

Daniel Pye, The Phnom Penh Post, 14 Nov. 2013

Two senior Ministry of Health officials have defrauded a multibillion-dollar fund, bankrolled largely by the US, Japan and Australia, out of hundreds of thousands of dollars in return for allocating more than $11.7 million in contracts to two foreign firms, a Global Fund investigation has found.

In a report released yesterday, the Global Fund said the director and deputy director at the National Centre for Parasitology, Entomology and Malaria Control (CNM) were paid “commissions” totalling $410,000 by Swiss firm Vestergaard Frandsen and Sumitomo Chemical Singapore between 2006 and 2011.

The CNM’s director allegedly covered up the fraud by suggesting the suppliers hire a “consultant” or “agent” to conduct their business, however the investigation found no evidence the agent had ever existed. The director and deputy director were the real recipients, the report said.

While the report does not identify the alleged offenders by name, Dr Duong Socheat served as the centre’s director for nearly the entirety of the investigation period. Socheat hung up on a Post reporter when called for comment yesterday evening.

The two suppliers have had their contracts with the fund suspended pending a full review following the two-and-a-half-year investigation into the allegations, which surfaced in 2011.

The report also found evidence of corruption in other programs it runs. It concluded that a procurement officer at the National Center for HIV/AIDS had received bribes to facilitate purchases and that MEDiCAM had falsified documents and invented staff positions to increase its funding.

Seth Faison, head of communications for the Switzerland-based Fund, said that the Fund had sent the report’s findings to the Cambodian police.

“[The director and deputy director are] not named in the report, but are identified by their titles and the time period they worked,” he said. “We’re referring the information on to law enforcement officials.”

The current CNM director, Dr. Char Meng Chour, could not be reached for comment on the report.

The Global Fund has remained tight-lipped throughout the years-long investigation, taking more than a year to release its findings after, in November 2012, it said it would be published in a matter of weeks.

Since 2003, the Fund has approved $116.8 million for malaria programs alone, and $353.3 million in total. But the programs – particularly the malaria one – have been beset with allegations of corruption and financial mismanagement.

In February, separate allegations emerged that a government-run and Global Fund-sponsored initiative had distributed expired anti-retroviral medication.

Yesterday’s report did not include details of expired HIV medication being distributed.

“We have heard rumours [about expired anti-retrovirals being used],” Faison said. “But have no evidence.”

Tim Vora of the HIV/AIDS Coordinating Committee said he had passed evidence of expired medication being distributed to the Fund months ago.

“The Global Fund has a clear objective to strengthen procurement. I think it was their responsibility to include [looking at expired HIV medication] in the report. They should not say [there’s no evidence], because we sent them the evidence,” he said.

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