BELIZE: AUDITOR GENERAL ISSUES SCATHING REPORT

UNCLAS BELMOPAN 000046 SIPDIS SIPDIS SENSITIVE E.O. 12958: N/A TAGS: PGOV ECON SOCI BH SUBJECT: BELIZE: AUDITOR GENERAL ISSUES SCATHING REPORT ¶1. (SBU) SUMMARY: The most recent report of Belize's Auditor General paints a bleak picture of "widespread" waste, fraud and abuse in the public sector. Like many of the reports of scandals and corruption in the current government, this one made a brief sensation in the press and then faded from view. The government has -- so far -- not been put on the defensive about its governance record during the election campaign. END SUMMARY. ¶2. (U) Belize's Auditor General Edmund Zuniga recently released his report for the financial year 2006/2007. It is blunt in its assessment of the situation in Belize: "fraud and impropriety are widespread throughout the public service." The report cites one example after another of lax or non-existent internal controls in areas ranging from revenue collection to records management, bank accounts, use of government vehicles and property management and paints quite a sad picture of what happens to public money and property here. ¶3. (U) The Auditor General was unable to provide an opinion on several key government statements of account due to lack of supporting documentation. The statement of assets and liabilities and balance in the consolidated revenue fund contained "material discrepancies," incomplete source documents, and had no reconciliation of millions of dollars transferred between government accounts. The report notes that "there is no indication of any effort having been made to collect outstanding loans." The analysis of the government's statement of public debt concludes that "as many as 40% of public debt transactions could not be audited because of the absence of source documents." ¶4. (U) The report cites numerous examples of fraud or misuse of office. In one case, a government official made multiple withdrawals from fake accounts in the Government of Belize Savings Bank. When the fraud was discovered the individual was fired but not prosecuted and the government made no effort to recover the money. A review of the Ministry of Natural Resources turned up multiple examples of Ministry officials acquiring public land (in one case 58 separate parcels) at concessionary "social rates." Land was subsequently transferred to relatives or sold at market prices. ¶5. (SBU) In a meeting with Poloff, Zuniga attributed the problems noted in the report to a combination of inadequate rules and policies, inadequate training, willful disregard of the rules and no penalties for violations. He said that he had taken the initiative to submit this report to both the Prime Minister and the National Assembly so that the document would be made public. The previous year's report, given only to the Prime Minister, has never been brought before the House or released publicly. ¶6. (SBU) The press seized upon the report when it came out (one headline: "Gov't records a mess!") but, as usually happens, quickly lost interest in the issue and did not follow the story very far. The current government has shown little interest in pursuing corruption investigations or prosecutions. Zuniga told Poloff that the Public Accounts Committee of the National Assembly would be the most likely body to follow up, but he was not optimistic that that would happen. ¶7. (SBU) COMMENT: Like the many other scandals that have plagued the government, the Auditor General's report seems to have made a brief impression and then faded from view. The opposition and the press have so far had little success, even with an election just a few weeks away, in keeping the government on the defensive about its governance record. END COMMENT. DIETER