Commision alleges BIA duty free shop made fraudulent claims
Afive- member Presidential Commission that probed ‘alleged corruption and malpractices from January 15, 2015 to December 2018’ has made strong strictures on the setting up of a Duty Free shop at the Bandaranaike International Airport (BIA).
The Commission said fraud and corruption had been caused by deliberately submitting fraudulent and misleading financial statements to obtain a million-dollar tender for Flemingo Duty Free Shop (Pvt) Ltd.
The report had already been handed over to then President Maithripala Sirisena. However, it has not been officially released yet.
The Commission was headed by Upaly Abeyrathne, retired Supreme Court Judge and comprised retired High Court Judge Sarojini Kusala Weerawardene, retired Auditor General, P. A. Premathilaka, retired ministry secretary R. de Silva, and retired Deputy Inspector General M.K.D. Wijaya Amarasinghe.
The Commission has recommended that the Chairman of the Technical Evaluation Committee and its members should be charged with failing to evaluate the financial statement and awarding the tender to Flemingo Duty Free Shop (Pvt) Ltd. It has also recommended that members of the Procurement Committee should be responsible for failing to study the recommendations before awarding the tender to Flemingo.
The Commission has submitted to both the Commission to Investigate Bribery or Corruption (CIABOC) and the Attorney General’s Department the files containing details of misuse of powers and abuse of state property.
The complaint, according to the Commission Report relates to a “A case of causing Fraud and Corruption by deliberately submitting fraudulent and misleading financial statements to obtain a million dollar tender for two duty free shops to the Indian company Flemingo at the BIA duty free shopping complex.
Among the observations made by the Commission in the report are:
The Procurement Committee on a rec
ommendation of the Technical
Evaluation Committee has awarded a tender to Flemingo Duty Free Shop (Pvt) Ltd to provide a duty free shop to the company.
The tender has been awarded though the annual turnover of the company was less than US $ 100 million. This was a violation of a tender condition.
The Financial statement submitted was not of the company Flemingo Duty Free Shop (Pvt) Ltd, but one of Flemingo Duty Free Shop (Pvt) Ltd and its Subsidiaries.
Accordingly, Flemingo Duty Free Shop (Pvt) Ltd failed to prove that its annual turnover was more than US $ 100 million.
It was a violation of the Tender document to award the contract to Flemingo Duty Free Shop (Pvt) Ltd on the financial statements of Flemingo Duty Free Shop (Pvt) Ltd and its Subsidiaries.
Entering into an agreement with Flemingo Duty Free Shop (Pvt) Ltd for 40 per cent of the shares from March 15, 2017 with approval of the Cabinet Permanent Procurement Committee and the Appeal board of the Cabinet Permanent Procurement Committee without evaluating the Technical Evaluation Committee report.
Failure to submit a certificate, that the collective income was sufficient to be considered if the tendering company was a consortium made up of several companies.
The Commission has recommended that the Chairman of the Technical Evaluation Committee and its members should be charged with failing to evaluate the financial statement and awarding the tender to Flemingo Duty Free Shop (Pvt) Ltd.