It has been disclosed that $145 million was improperly transferred from the bank account of the Caribbean Maritime University (CMU) to a trust fund with no accountability for how the money was later spent.
It is one of the findings in the Auditor General's Department's report on the operations of the CMU.
The Auditor General's Department noted that the Jamaica Maritime Institute Trust Fund (JMITF) was set up in 1997 under the former Jamaica Maritime Institute, but no attempt had been made to bring it under the governance of the CMU when the institution was upgraded to a university.
It further pointed out that the trust fund's committee had not met since April 2015.
The Fund also received no donations and undertook no fundraising activities for the last six years and made no disbursements to needy students or CMU as set out in its mandate.
Despite this inactivity, deposits totalling $189.3 million were made to the trust fund for the 2016/17 to 2018/19 period and $188.3 million withdrawn.
One deposit of $145 million was identified as coming from the CMU and represented disbursements from the Education Ministry for payment of salaries in March 2018.
The Auditor General said it is unclear why the CMU would have lodged the money to the trust fund account.
It said this represented a breakdown in transparency since the funds were transferred from CMU's main account to a non-CMU bank account.
The payments made from the transferred funds were not captured in the CMU's accounting records.
The JMIFT did not have any current financial records.
The Auditor General pointed out that the signatories to checks drawn on the JMITF account were the secretary general and treasurer of the trust fund who were also the CMU president and the finance committee chairman of the university.
The withdrawn sums were used to make payments relating to construction projects.
Furthermore, the Auditor General said the CMU did not provide vouchers to support payments totalling $41.2 million.
Included in the payments were five cheques totalling $4.1 million on May 18, 2018.
The Auditor General said three of the recipients of the cheques were related parties who encashed them at the same bank on the same day.
Another $17.6 million of the unsupported payments were made to one company which also received $7.3 million from the CMU's canteen account.
The Auditor General was unable to determine the purpose of transfers totalling J$9.6 million and US$223,000 from the CMU's bank account.
The funds were transferred following letters of authorization under the signature of the CMU President, Deputy President and the Vice President - Office of University Advancement and Development.
No documentation
According to the Auditor General, the CMU was unable to provide the requested documentation to verify that all payments, represented a proper charge to the University and payments were certified and authorised.
The Auditor General said despite her Department's request, the CMU is yet to present related documents to allow for audit scrutiny.
The audit uncovered that the CMU withdrew US$70,333 classified as per diem and stipend for 10 individuals not employed to the CMU.
While the auditors saw memorada giving instructions for payment, there were no bills provided to substantiate the authenticity of the payments.
Included in the withdrawals were two payments totalling US$6,389 of which US$3,535 related to per diem for the co-owner of Logistics Company One, who was identified as a PhD student of the CMU.
The trip occurred November 14 to 23, 2018 to Abuja, Nigeria to discuss partnership between Nigeria and Jamaica in order to foster collaboration between Nigerian universities and the CMU.
However, approval for official travel for the co-owner of Logistic Company One was not sought from the Cabinet Secretary despite the use of CMU's financial resources; whereas approval for the other members was granted on November 1, 2018 by the Cabinet Secretary through the Education Ministry.
The Auditor General said her team saw no invoices, bills or receipts from the payees so the authenticity of the payments could not be validated.
Limited oversight
The Auditor General also highlighted what it said was the limited oversight of the CMU by successive portfolio ministries.
It was discovered that the CMU Council neither submitted nor did the portfolio ministry request copies of board minutes.
This is a breach of the Accountability Framework as Permanent Secretaries are required to receive copies of Board minutes of public bodies under their portfolio.
The Auditor General said although the CMU submitted its corporate plans, it did not consistently present annual or half-yearly reports to the respective Permanent Secretaries and portfolio ministers.
The CMU's last financial report was for 2013/14 and submitted to the Transport Ministry.
The last audited financial statement was prepared for the 2014/15 financial year.
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