Probe finds Tk 28.6cr irregularities in RCCI
A probe detected financial irregularities worth Tk 28.60 crore including Tk 18.04 lakh dodged in taxes by Rajshahi Chamber of Commerce and Industries (RCCI) from March 2003 to January 2011.
It also found several administrative irregularities like illegally enrolling new general members just before the four RCCI executive committee elections held during the period.
The probe was carried out by a five-member body, formed by RCCI Administrator Ziaul Haque Tuku, approved by the commerce ministry on July 5 this year and led by former additional deputy commissioner of Pabna KNAM Nazrul Haque.
The other members are Transparency International Bangladesh Rajshahi unit convener Prof Chowdhury Sarwat Jahan, Commercial Audit Directorate Audit and Accounts Officer Abdul Majid, Rajshahi Development Authority Administrative Officer Khurshid Alam and the local Rajshahi daily Sonar Desh Executive Editor Hasan Millat.
The Daily Star got a copy of the 48-page probe report, prepared on September 10, which held RCCI Accountant M Shakhawat Hossain responsible for most of the irregularities and termed him “unfit and unskilled”.
FINANCIAL IRREGULARITIES
The RCCI executive body, as per its rules, can spend not more than Tk 300 per day. But during the period investigated into, it spent a minimum of Tk 319 and a maximum of Tk 2.25 crore per day, amounting to Tk 26,96,81,041. Moreover, the government rule making it mandatory for the person making those expenditures to sign the cashbook was never followed, said the report. The executive body dodged Tk 15,34,292 in VAT and taxes which it should have cut off from the bills of a construction firm. Similarly, taxes worth Tk 1,32,170 was dodged while purchasing furniture, electronics, hardware goods and printing works, Tk 87,833 while paying off eight contractors and suppliers and Tk 50,297 while paying off legal advisors. Advertisements worth Tk 32,835 as per the newspaper rate was billed Tk 1,60,111, causing RCCI a loss of Tk 1,27,276. There was no tender for an expenditure of Tk 56,35,388 in the construction of RCCI Bhaban while purchase of machineries worth Tk 31,40,518 flouted government rules and was beyond the expenditure limit, said the report. RCCI incurred a loss of Tk 12,94,212 by not realising 10 percent liquidity damage from the contractor for delaying RCCI Bhaban's construction. In contrary, Tk 4,41,084 was deducted from the same contractor's bill for faulty construction though he, as per government rules, should have been compelled to correct the faults. Though keeping storage records is mandatory, there was none in the purchase of Tk 18,15,041 worth furniture, Tk 16,36,522 worth construction materials and Tk 1,64,429 worth stationery goods. Another Tk 1,48,154 spent on entertaining guests was unlawful and Tk 65,000 in advance payments to four parties were never adjusted in the audit reports. The executive committee overpaid its illegally appointed employees Tk 38,833 and provided its auditors an extra Tk 15,500 as travel allowance. The probe also found expenditures in filing unnecessary cases and writ petitions without recommendations of legal experts. “UNHEALTHY COMPETITION”
Just a few days before the executive committee's election in 2003, 1,243 people were given membership, bringing general members to a total of 1,526. Of them, only 310 renewed their membership in 2005. Similarly, 4,771 new members were enrolled before the 2009 election. But only 286 from the new total of 5,091 members renewed their membership the next term. Mentionable, the membership process requires approval from the RCCI Board Meeting and verification by the executive committee. But these two regulations were flouted, said the report, adding that the number of businessmen eligible for RCCI membership is around 300. At least eight people gained membership either using nonexistent trade groups or having no membership of any trade groups at all. Although there is no “house committee” in the RCCI constitution, the executive committee formed this body right before the elections to keep its influence. RECOMMENDATIONS
The report suggested punitive action against the accused and steps to stop the irregularities and realise the money lost. RCCI Administrator Ziaul Haque Tuku said they would publish the report formally within a short time. The report was given to General Prosecutor Rabiul Haque Kakor for his opinion on identifying the accused. “Separate bodies are needed to further investigate and identify the others responsible,” he said, adding that the commerce ministry already reviewed the report and directed RCCI to take necessary action.
The RCCI executive body, as per its rules, can spend not more than Tk 300 per day. But during the period investigated into, it spent a minimum of Tk 319 and a maximum of Tk 2.25 crore per day, amounting to Tk 26,96,81,041. Moreover, the government rule making it mandatory for the person making those expenditures to sign the cashbook was never followed, said the report. The executive body dodged Tk 15,34,292 in VAT and taxes which it should have cut off from the bills of a construction firm. Similarly, taxes worth Tk 1,32,170 was dodged while purchasing furniture, electronics, hardware goods and printing works, Tk 87,833 while paying off eight contractors and suppliers and Tk 50,297 while paying off legal advisors. Advertisements worth Tk 32,835 as per the newspaper rate was billed Tk 1,60,111, causing RCCI a loss of Tk 1,27,276. There was no tender for an expenditure of Tk 56,35,388 in the construction of RCCI Bhaban while purchase of machineries worth Tk 31,40,518 flouted government rules and was beyond the expenditure limit, said the report. RCCI incurred a loss of Tk 12,94,212 by not realising 10 percent liquidity damage from the contractor for delaying RCCI Bhaban's construction. In contrary, Tk 4,41,084 was deducted from the same contractor's bill for faulty construction though he, as per government rules, should have been compelled to correct the faults. Though keeping storage records is mandatory, there was none in the purchase of Tk 18,15,041 worth furniture, Tk 16,36,522 worth construction materials and Tk 1,64,429 worth stationery goods. Another Tk 1,48,154 spent on entertaining guests was unlawful and Tk 65,000 in advance payments to four parties were never adjusted in the audit reports. The executive committee overpaid its illegally appointed employees Tk 38,833 and provided its auditors an extra Tk 15,500 as travel allowance. The probe also found expenditures in filing unnecessary cases and writ petitions without recommendations of legal experts. “UNHEALTHY COMPETITION”
Just a few days before the executive committee's election in 2003, 1,243 people were given membership, bringing general members to a total of 1,526. Of them, only 310 renewed their membership in 2005. Similarly, 4,771 new members were enrolled before the 2009 election. But only 286 from the new total of 5,091 members renewed their membership the next term. Mentionable, the membership process requires approval from the RCCI Board Meeting and verification by the executive committee. But these two regulations were flouted, said the report, adding that the number of businessmen eligible for RCCI membership is around 300. At least eight people gained membership either using nonexistent trade groups or having no membership of any trade groups at all. Although there is no “house committee” in the RCCI constitution, the executive committee formed this body right before the elections to keep its influence. RECOMMENDATIONS
The report suggested punitive action against the accused and steps to stop the irregularities and realise the money lost. RCCI Administrator Ziaul Haque Tuku said they would publish the report formally within a short time. The report was given to General Prosecutor Rabiul Haque Kakor for his opinion on identifying the accused. “Separate bodies are needed to further investigate and identify the others responsible,” he said, adding that the commerce ministry already reviewed the report and directed RCCI to take necessary action.
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