Auditor General orders probe into ventilator contract awarded to Dubai-based company

The Auditor General’s Office has ordered an investigation into the decision to contract Dubai-based General Trading LLC to import 75 ventilators to strengthen the capacity of the Maldivian health system to treat coronavirus patients who require intensive care.

Health Ministry contracted the import of ventilators to three private companies; Medtech Maldives, Naadu Private Limited, and Executors General Trading LLC.

Health Minister Abdulla Ameen and officials from National Emergency Operations Center (NEOC) previously stated that the Executors General Trading was contracted at the recommendation of World Health Organization (WHO).

However, the Auditor General’s Office, in a compliance audit report on coronavirus-related spending by the Health Ministry it released on Sunday, said that the WHO told auditors the company was not recommended by the organization.

The compliance audit report states that though Executors General Trading claimed to have 75 ventilators in its warehouse ready for shipping and promised to deliver them within 14 days, health experts were well aware that agents who traded in specialized medical equipment would not have such a large quantity of equipment in stock, and should therefore have questioned the claim and been alert towards the possibility of fraud.

“We find the fact that the ventilators haven’t been delivered in the more than four months which has passed since the agreement was signed, despite their promise of delivering them within 14 days, to be reasonable grounds to suspect Executors General Trading of fraud. There will be an increased number of fraudulent agents and frauds impersonating as agents in a time of such high global demand for ventilators. Therefore, it is the responsibility of officials in charge of financial affairs of the state to be extra vigilant in protecting public assets and funds,” reads the report.

The Auditor General’s Office also found that the 90 percent (MVR 30 million) of the payment which was paid as an advance, including the 75 percent (MVR 25.7 million) paid on April 2, and additional 15 percent (MVR 5.1 million) paid later, was paid without securing an advance payment guarantee.

The office said it will be difficult to recover the advance payment if Executors General Trading does not deliver the ventilators.

“We not that this has put the state at risk of great financial loss,” reads the report.

The Auditor General’s Office also found that Health Ministry submitted false information and did not have a performance guarantee when it requested the Finance Ministry for approval to procure the ventilators through Executors General Trading.

The audit report states that Health Ministry’s biomedical engineers had recommended Weinmann brand portable ventilators and Draeger brand ICU ventilators, but that invoices show the 11 ventilators delivered by Executors General Trading so far to be JIUJIUXIN brand ventilators.

The ventilators in question were found to be of inferior quality and were rejected.

The Auditor General has ordered for an investigation into the case, given the failure to deliver the ventilators as contracted despite the 90 percent advance payment.

The audit uncovered multiple breaches of the Public Accounts Act in connection to the case, and concluded that, given the lack of advance payment guarantee, lack of performance guarantee, and the 90 percent advance payment, neither the Health Ministry’s finance head, nor the officers who issued approval through the public accounting system, are believed to have executed their duties.

The Auditor General’s Office also found that the Health Ministry’s bid committee was negligent in executing its responsibilities due to the failure to check whether a financial and performance evaluation had been conducted on Executors Private Limited, and failure to take into account the recommendations of the biomedical engineers regarding the preferred brands of ventilators,  and ordered an investigation against the committee for negligence.