Koroma government of Sierra Leone doing business with North Korea?

Sierra Leone Telegraph: 6 April 2016

Exactly a month ago – 6^th March 2016, the South Korean government, deeply concerned about the extent to which countries are helping North Korea breach UN imposed sanctions, published a statement accusing one of the most corrupt nations in the world – Sierra Leone, of doing business with the North Korean government.

North Korea, a country isolated by the whole world, described and classified as part of a dangerous axis of evil by the United States and several European countries, is determined to develop its nuclear weaponry and military prowess at all cost.

And there are few countries in the world, that are helping the North Koreans achieve their military and industrial development objectives, against the will of the international community and the UN, in return for cash.

But how much cash the government of Sierra Leone has received from North Korea for the use of the Sierra Leone flag on its illegal fleet of ships, is unknown.

Investigations carried out by the Sierra Leone Telegraph proved futile. Those at the top of the Koroma government and the maritime administration are tight lipped.

When news about the use of the Sierra Leone national flag of convenience by the North Korean ship – the Jing Teng, broke last month, the Sierra Leone Telegraph put this question to the country’s Attorney General and Justice Minister, who is the former head of the Anti-Corruption Commission – Joseph Kamara:

“There is report from South Korea of a North Korean ship – the Jing Teng, registered and carrying the Sierra Leonean flag of convenience, has been impounded in the Philippines. Why is Sierra Leone doing business with North Korea, despite a UN resolution prohibiting trade with that country?

“How much was paid to the government of Sierra Leone, and which ministry made the decision to do business with North Korea?”

In reply, the attorney general said: “The Sierra Leone Maritime Administration is responsible for shipping registration,” but did not comment on the legality or otherwise, of the decision to do business with North Korea and how much Sierra Leone is receiving in return for this UN sanctions bursting deal with the North Koreans.

Similar question was put to the Commissioner General of the National Revenue Authority (NRA) – Haja Kallah Kamara: “Does the NRA collects revenue from foreign ships flying the Sierra Leone flag of convenience?” No reply received – stoned silence.

This is what the South Koreans said in their statement last month:  “SEOUL, March 6 (Yonhap) – A North Korean ship impounded in the Philippines last week was registered as being from Sierra Leone, via a practice called flag of convenience. 

“Flag of convenience is a business practice of registering a merchant ship to a country, other than its origin for the purposes of avoiding taxes and other regulations.

“The Philippines seized the North Korean ship Jin Teng on Saturday, becoming the first country to enforce sanctions on the reclusive country since the United Nations Security Council passed a more comprehensive resolution last week.

“Resolution 2270 subjects 31 ships belonging to North Korea’s Wonyang Shipping Corp. to an asset freeze and sanctions.

“Despite being Sierra Leone-flagged, the Jin Teng was seized because the sanctions are imposed via the ship’s International Maritime Organization (IMO) number, not its country of origin, a South Korean official said.

“Nine other ships on the list are registered as being from countries other than North Korea, including Tanzania and Cambodia, the official added.” (End of statement).

Is the Koroma government very desperate for cash that, it will do business with the devil – those described by the US and Europe as part of the global axis of evil?

Or is the Sierra Leone Maritime Administration simply another cog in the wheel of corruption that drives the Koroma government?

Investigations by the Sierra Leone telegraph reveal that millions of dollars are collected every year by the Sierra Leone Maritime Administration from countries that are using the Sierra Leonean flag of convenience on their vessels.

But because of the lack of transparency and accountability across government departments, and the deep rooted culture of abuse of office, this money and millions more received from other revenue streams, according to the country’s Auditor General 2014 Report, have not been accounted for.

The audit report found that;  “Source documents (invoices, receipts and other supporting documents) were not provided, for income disclosed in the Financial Statement from International Ships Registration which amounted to Le324.4 million and Le461 million in 2011 and 2012.

“Receipts were not submitted for audit inspection to substantiate freight levy income received by the Administration for the amounts of Le8.18 Billion and Le9.812 Billion in 2011 and 2012.

“London Mining Ltd. and African Minerals Ltd. had not been paying freight levy charges. No evidence was submitted by the Agency that exempts those companies from paying those charges.

“Procurement procedures were not followed for the procurement of non-current assets which amounted to Le197 million and Le382 million for 2011 and 2012 respectively.

“Evidence of prior approval from the administration’s board for the write off of Le2.5 Billion in 2011 was not provided to the audit team for review. Although unbudgeted capital expenditure should be approved by the board, we noted that a total of Le126.4 million was spent on non- current assets which were not budgeted for and prior approval from the board not evidenced during 2012.

“Totals of Le388 million and Le347 million for 2011 and 2012 respectively were recorded as revenues collected in respect of sales of life jackets, seamen diaries and local registrations. However, banking details were not submitted for audit inspection as a result, the audit team could not trace or verify these monies in the bank statement.

“Bank confirmation for Le809 million and Le107 million was not received for 2011.

“Debtors’ circularisation was sent to clients which amounted to Le7.7 Billion and Le8.7 Billion for 2011 and 2012 respectively. However, no responses had been received from the debtors.

“Long outstanding payments due to NRA and NASSIT in respect of employees PAYE and NASSIT contributions which amounted to Le388 million were still unpaid as at 31st December 2012.

“Management did not pay PAYE for the months of April, May and June 2014 to NRA.

“Payment Vouchers (PV) raised for payments to the tune of Le92.3 million were without adequate supporting documents. Payment vouchers to the tune of Le1.41 Billion could not be found, out of a random sample the auditors tested.”

This is serious corruption in just one of more than 50 government ministries and public institutions, run by the Koroma government.

Whilst corruption in the Koroma government has become endemic, costing the nation billions of dollars every year, there is growing worry that as foreign aid and international remittance are set to decline even further this year and the next, ministers and other public officials will become much more creative, as they find ways to illegally enrich themselves and those at the top of the food chain.

Doing business with North Korea is regarded as a serious breach of UN sanctions. But for those Sierra Leone government officials whose preoccupation is personal enrichment – by all means possible, UN sanctions bursting are the least of their problems, and getting caught will not induce insomnia either.

On Monday, 4^th April, a local newspaper in Sierra Leone (Awoko) reported that; “Sierra Leone Maritime Administration has issued a stern warning to North Korean ships sailing under its flag, after one of such ships was seized in the Philippines port. The Maritime Administration said the warning issued on March 17 was targeting the owners and managers of North Korean vessels operating under the Sierra Leone flag.”

But what is the nature of that warning? Will president Koroma publish a full auditable statement of all incomes earned by the government since elected to office in 2007, from selling the use of the country’s flag to foreign ships, including the North Koreans?