Commissioner of Police David Manning has refuted claims by Leader of Opposition Belden Namah that the investigation into the alleged theft of K268 million held in trust for the impact communities of the Ok Tedi Mine, is politically motivated.
Mr Manning said there are allegations that significant funds have been expended by “trustees” with no evidence of benefits to the beneficiaries. The Trust Funds belong to the 148,000-plus people from 158 villages located in the communities along the Fly River mine corridor in the Western Province.
“That is what the police through the Special Police Forensic Criminal Investigation team is investigating. That is all I can say for now as the matter is now before the court and we will address the allegations raised by Mr Namah in court,” Mr Manning said.
Meanwhile Mr Manning said the Special Police Forensic Criminal Investigation Team’s (SPFCIT) combined forensic and criminal investigation into the alleged theft of the K268 million, is on-going.
SPFCIT, which is headed by the Commissioner, began the high-profile investigation more than ten (10) months ago.
Manning said, the alleged financial crime is the single biggest fraud that has ever been investigated by Police in the history of Royal Papua New Guinea Constabulary (RPNGC). SPFCIT aims to expose the alleged fraudsters, bring them to justice, recoup the monies that have been misappropriated and stolen, and implement measures to prevent reoccurrence of such white-collar crimes in future.
The Western Province People’s Dividends Community Mine Continuation Agreement (WPPD CMCA) Trust Funds were received as dividends paid by Ok Tedi Mining Limited between the financial years 2007 and 2014 based on a five per cent equity held in the Ok Tedi Mining Project. The monies were captured in the WPPD CMCA Trust Account held with the ANZ Bank.
The five per cent stake in the Ok Tedi Mining Project was allocated to the people of CMCA Communities in Western Province following the outcome of 2006/2007 CMCA Review. The equity funds were specifically set aside to deliver ‘authorised projects’ to the people of the CMCA Communities.
Pursuant to Section 15 of the Public Finances Management Act 1995, then Minister for Finance John Hickey, drew up a Trust Instrument and established a Trust Account called WPPD CMCA Trust Account with ANZ Bank to receive and save the dividends paid based on a five per cent stake held in the Ok Tedi Mining Project.
The various legislative obligations surrounding the use of WPPD CMCA Trust Funds were enshrined in the original Trust Instrument approved by the then Finance Minister.
Prior to the withdrawals, the WPPD CMCA Trust Account had a balance of K278,278,958.40. After the withdrawals, only K10,620,735.42 remained as of November 30, 2020.
Police alleges withdrawals not authorised
In summary, SPFCIT established that withdrawals of K268 million made from WPPD CMCA Trust Account held with ANZ Bank were:
- Not consistent with the original purpose of the WPPD CMCA Trust Funds to implement development projects and programs to benefit the people from the Western Province, and the CMCA Region more particularly, as specified in the Mining (Ok Tedi Restated Eight Supplemental Agreement) Act 1995 (8th Supplemental Agreement Act);
- Not authorized by the Minister for Mining as specified in the 8th Supplemental Agreement Act;
- Not endorsed or the subject of consultation with the Western Province Provincial Government as specified in the 8th Supplemental Agreement Act; and
- Not paid to Ok Tedi Development Foundation (OTDF) which is the exclusive service delivery vehicle contemplated by the Ok Tedi Mine Continuation (9th Supplemental Agreement) Act 2001 (9th Supplemental Agreement Act).
In connection with the progress of the investigation, SPFCIT has arrested Young & Williams Principal lawyer Greg Sheppard, who is currently in court to answer to his eight charges.
Three other directors of the OTFRDF, namely Eda Oai, Annie Smerewai and Boston Kassiman are also in court to defend the fifteen charges of misappropriation, false pretense and conspiracy, laid against them also.
Manning said police have not been able to arrest and charge the Chief Executive Officer of OTFRDF Samson Jubi and other directors of OTFRDF, as they have evaded police and gone into hiding.
Meantime, the SPFCIT has completed the Police Hand-Up Briefs in relation to the charges for Sheppard, Oai, Smerewai, Kassiman. These were submitted to the Committal Court. A copy of the Police Hand-Up Brief was given to each of the four defendants. The Police Prosecutor taking carriage of the four cases was also served with copies.