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Golden handshakes, phantom charities, misappropriation of public funds, the behind-the-scene wranglings that have spawned a new type of political animals that have more passion for money than their political jobs and serve as rueful reminders of the legacy of greed and exploitation that too often flourishes in Jamaica’s political landscape.
In the relatively short time since Jamaica gained independence, the island has been rocked by a number of scandals, political or otherwise that, while they have not completely derailed the engine of progress in the island, have left the country’s future veering towards the dubious.
On July 27, 1989, the mini-earthquake that would be hitherto known as the ’Farm Work Scandal’ rocked the country. Improprieties and irregularities involving thousands of dollars from the U.S and Canadian Farm Work Programme, implicated a former Minister of Labour, Mr. J.A.G Smith, and a former permanent secretary, Probyn Atkin.
Of the ’improprieties’ the most damning charge included a lodgement of US$20,260 to a Belgian bank for the purchase of a Mercedes Benz, agricultural equipment and a Volkswagen car, payment for architectural drawings, contractual work involving the IDT by a company called Rapid Repair and Maintenance owned by Mr. Smith. The cost of travel by Concorde by Mr. Smith as well as substantial payments for medical treatment was culled from the funds of the Farm Work programme.
In a dramatic twist, Probyn Aitken, 64, retired permanent secretary in the Ministry of Labour, pleaded guilty on May 8, 1990, and became the main witness in the case against Smith. He was sentenced in the Sutton Street court to nine months’ imprisonment.
The bespectacled Smith, a chartered accountant who served as Minister of Labour in Jamaica Labour Party’s Government from November 1980 to February 1989, was convicted and sentenced to a three-year prison term for conspiracy to defraud the Farm Work Programme.
Smith appealed to the UK Privy Council, but lost his appeal.
They were not the first serving Members of Parliament to be convicted of dishonesty. In the 1950s, two Ministers of Government were jailed for selling farm work tickets and a third jailed for breaching the Official Secrets Act - disclosing Cabinet secrets.
In what was probably the biggest scandal in Jamaica’s history given the sheer magnitude of the sums involved and the sheer number of persons in all facets and all levels of Jamaican society who actively partici
pated in the exercise - the Zinc Scandal could easily be billed ’Jamaica’s Scandal’.
In the aftermath of Hurricane Gilbert, widespread reports indicated that more than six years supply of zinc valuing more than $500 million came into the island for victims of the disaster, but did not reach the needy hurricane victims for who the roofing material was intended.
Reports also indicated that zinc was dumped at sea and some sold for prices ranging from $20 to $70 per sheet, well below the $80 to $130 normal retail cost.
A commission was set up in February 1991, to looking into the disappearance of hurricane relief supplies. In October of 1993, the commission’s findings were made public. E.G Green, the sole commissioner of the zinc enquiry, linked the disappearance of the zinc to criminal activities, and recommended that the matter be handed over to the Director of Public Prosecutions.
In a colourfully-worded 120 page report tabled in the House of Representatives, Mr. Green said zinc sheets were used as ’currency notes’ and blamed former Prime Minister Edward Seaga for some of the problems that dogged the relief exercise.
Mr. Green questioned the reason behind the importation of six years supply of zinc sheets after the hurricane, and reported that no budgetary provision had been made to facilitate the execution of a distribution plan. ’Whatever his motives might have been, the Prime Minister of the day proceeded to flood the building industry during the six months immediately succeeding the hurricane with more zinc that the industry had been able to absorb,’ Mr. Green had declared.
In his return salvo, Opposition Leader Edward Seaga replied that ’it was strange that nowhere in the report has any mention been made of what happened to $500 million worth of zinc reported to be missing.’ He also pointed to the fact that in February 1991, the JLP had objected to Mr. Green’s appointment on the basis that ’the Party did not believe that he had the seniority or competence to head the Commission.’ The ODP is now the sole agency for future relief distribution. It is perhaps interesting to note that the public did not seem unduly interested in the enquiry into the missing zinc, a violation of the scarce benefits dis
tribution system which could not be easily pinned on any single individual. And so ended another episode in Jamaica’s fast-growing culture of pork barrel politics.
The country had scarcely negotiated the zinc scandal when it was slammed by yet another, the 1991 Furniture Scandal.
The ’furniture scandal’ as it has been called, arose as a result of false invoices for goods and services allegedly supplied to the official residences of Parliamentarians in the present government, being submitted to the Houses of Parliament for payment. In some instances, genuine invoices on which items had been over-priced were also submitted.
The public was baffled and enraged to learn that in the absence of a guideline for furniture for the houses of ministers could be interpreted as a permit to go on a spending spree which involved the non-inspection of goods coming into the country, alleged over-pricing and actions which amount to fraud.
Edley Deans, Clerk to the Houses of Parliament, one of the witnesses in the case claimed that in the year 1990 to 1991, $600,000 was voted for furniture and furnishings, but was fast eclipsed by overspending of $3 million.
in November 1992 to defrauding the Government of more than $1 million in the $1.5 million Furniture Scandal case and were fined a total of $44,000.
On diverse days in 1990 with intent to defraud, they obtained from the Government of Jamaica a total of $1,010,935.02 by falsely pretending that they were entitled to the said amount as payment for goods and services supplied by the companies and claimed on invoices. The Resident Magistrate’s hands were tied. He could not go beyond what the law states that a company should be fined for such an offence. Section 268 of the Resident Magistrate (Judicature) Act states that the maximum fine is $4,000.
Under the Customs Act a company which has uncustomed goods is fined three times the value of the goods.
ute Saddler and his wife Michele, directors of the companies were withdrawn after Glen An
drade, Q. C. Director of Public Prosecutions offered no evidence against them. They were charged jointly with the companies and Robert Hill, an inventory clerk formerly employed to the House of Representatives.
Hill had been accused of causing and attempting to cause valuable securities to be paid out and conspiracy to defraud the government of $1.5 million between December 1989 and February 1991.
Count 1 of the indictment charged Hill with conspiring with persons unknown between the month of December 1989 and February 1991 to defraud the Government of Jamaica by falsely representing that they were entitled to payments for goods and services supplied to the Government as claimed on the invoices submitted for payments. The other six counts charged him with causing valuable securities to be delivered by means of false pretences.
On February 5, 1993. He was sentenced on all seven counts to serve 14 years in prison but served only two as the terms ran concurrently. But the embers from the sordid furniture mess refuse to die, and the Furniture Scandal once again resurfaced in court this year. This time, one of the three companies which pleaded guilty in November 1992 to obtaining money by false pretences arising from the scam, is pursuing legal action in the Supreme Court against the Government and Robert Hill, a former inventory clerk employed to the Houses of Parliament. The company, Stepshonics Ltd., wants to recover $500,000 allegedly owing to it for goods supplied.
In the latter part of that ill-fated year, in November 1991, the incident hitherto known as the Shell Waiver issue broke big time, It was not a scandal in the true sense of the word in as much as an concerted and deliberate effort to defraud the Government. However, it represents an unbelievable case of bureaucratic bungling by the Cabinet ministers who had contact with the issue.
The incident involved $29.5 million in duties which was waived in favour of Shell Company (West Indies Limited) and which caused the resignation of ambassador at large and a close confidante of Prime Minister Michael Manley, executive chairman of Petroleum Corporation of Jamaica (PCJ), Eli Matalon.
The political fallout was tremendous as it also prompted the subsequent resignation as Minister of Energy and Mining of Horace Clarke, and that of the then Minister of Finance, P.J Patterson.
Details from the scandal revealed that it was Mr. Clarke who recommended the waiver to be granted and Mr. Patterson who agreed to it. In his resignation letter Mr. Clarke also admitted that the ultimate decision to grant the waiver was his.
Mr. Matalon had been adamant that Shell should pay the punitive duties which had been lev
ied, because after the duties on the first shipment of unleaded petroleum had been waived, Shell had been told specifically that if it continued to import the product, it would be charged all duties. He explained that he had resigned as he had no alternative after he learned that the waiver had been granted because he had consistently opposed the waiver as part of his actions at PCJ, where he had explained to the board that they should abide by the Cabinet’s decision taken in July of 1990, in the interest of the viability of Petrojam.
Some schools of thought argued that the decision to grant Shell the waiver was in the interest of the motoring public and therefore was sound from a political (ministerial) stand point. Mr. Matalon is of the view that Shell should pay the punitive duties even if it means that Petrojam has to pay too, even if the cost of unleaded fuel to the motoring public goes up.
Eli Matalon and Howard Hamilton, general manager of Shell Company (W.I.) Ltd, are seen to each represent the contending interests. At that time, Howard Hamilton was an influential member of the ruling party who became a figure of controversy first with his introduction of the Scratch and Win game and then latterly with the Shell waiver issue. He received the licence to operate a lottery when it was common knowledge that Government was against this type of activity.
Almost no regulations existed in May 1990 regarding custom and taxation regimes for petro
leum products. In fact, almost everything was imported duty-free: crude oil for Petrojam; avi
ation fuel for the airports, imported by Shell; finished petroleum imported for Tropicana; and the special gas imported by Shell for JPS’s gas-turbines in Montego Bay. The advent of GCT, deregulation of the indus
try and Shell’s move to import unleaded gas presented the government with the need to establish levies in a short period. It is out of this frenzied atmosphere that the recent imbroglio was hatched.
During 1990, at first through a Ministerial Order that was in September incorporated into a law, the government introduced five duty regimes that were the liability of ’non-refiners’. However, ’refiners’ were liable only for one of those: the equivalent of the old consumption duty (now GCT).
The loophole was created in 1990 to benefit Petrojam’s periodic importation of petroleum at times when its own refinery experienced a shortfall. Petrojam has never paid import duties regardless of what it im
ported and irrespective of what regulations were on the books, and the loophole which, naturally, permits duty-free entry of petroleum fuel, by preparing customs declarations that were filled-out with the same secret codes used by Petrojam to import periodic shipments.
The Shell waiver brought the year to its close like a train line of dominoes, with upheavals within the Cabinet of government, the resignation of Mr. Eli Matalon from the Petroleum Corporation of Jamaica setting in motion the domino chain of reaction leading to the downfall of Mr. Horace Clarke and the departure of Mr. P.J. Patterson from the Cabinet.
In the relatively short time since Jamaica gained independence, the island has been rocked by a number of scandals, political or otherwise that, while they have not completely derailed the engine of progress in the island, have left the country’s future veering towards the dubious.
On July 27, 1989, the mini-earthquake that would be hitherto known as the ’Farm Work Scandal’ rocked the country. Improprieties and irregularities involving thousands of dollars from the U.S and Canadian Farm Work Programme, implicated a former Minister of Labour, Mr. J.A.G Smith, and a former permanent secretary, Probyn Atkin.
Of the ’improprieties’ the most damning charge included a lodgement of US$20,260 to a Belgian bank for the purchase of a Mercedes Benz, agricultural equipment and a Volkswagen car, payment for architectural drawings, contractual work involving the IDT by a company called Rapid Repair and Maintenance owned by Mr. Smith. The cost of travel by Concorde by Mr. Smith as well as substantial payments for medical treatment was culled from the funds of the Farm Work programme.
In a dramatic twist, Probyn Aitken, 64, retired permanent secretary in the Ministry of Labour, pleaded guilty on May 8, 1990, and became the main witness in the case against Smith. He was sentenced in the Sutton Street court to nine months’ imprisonment.
The bespectacled Smith, a chartered accountant who served as Minister of Labour in Jamaica Labour Party’s Government from November 1980 to February 1989, was convicted and sentenced to a three-year prison term for conspiracy to defraud the Farm Work Programme.
Smith appealed to the UK Privy Council, but lost his appeal.
They were not the first serving Members of Parliament to be convicted of dishonesty. In the 1950s, two Ministers of Government were jailed for selling farm work tickets and a third jailed for breaching the Official Secrets Act - disclosing Cabinet secrets.
In what was probably the biggest scandal in Jamaica’s history given the sheer magnitude of the sums involved and the sheer number of persons in all facets and all levels of Jamaican society who actively partici
pated in the exercise - the Zinc Scandal could easily be billed ’Jamaica’s Scandal’.
In the aftermath of Hurricane Gilbert, widespread reports indicated that more than six years supply of zinc valuing more than $500 million came into the island for victims of the disaster, but did not reach the needy hurricane victims for who the roofing material was intended.
Reports also indicated that zinc was dumped at sea and some sold for prices ranging from $20 to $70 per sheet, well below the $80 to $130 normal retail cost.
A commission was set up in February 1991, to looking into the disappearance of hurricane relief supplies. In October of 1993, the commission’s findings were made public. E.G Green, the sole commissioner of the zinc enquiry, linked the disappearance of the zinc to criminal activities, and recommended that the matter be handed over to the Director of Public Prosecutions.
In a colourfully-worded 120 page report tabled in the House of Representatives, Mr. Green said zinc sheets were used as ’currency notes’ and blamed former Prime Minister Edward Seaga for some of the problems that dogged the relief exercise.
Mr. Green questioned the reason behind the importation of six years supply of zinc sheets after the hurricane, and reported that no budgetary provision had been made to facilitate the execution of a distribution plan. ’Whatever his motives might have been, the Prime Minister of the day proceeded to flood the building industry during the six months immediately succeeding the hurricane with more zinc that the industry had been able to absorb,’ Mr. Green had declared.
In his return salvo, Opposition Leader Edward Seaga replied that ’it was strange that nowhere in the report has any mention been made of what happened to $500 million worth of zinc reported to be missing.’ He also pointed to the fact that in February 1991, the JLP had objected to Mr. Green’s appointment on the basis that ’the Party did not believe that he had the seniority or competence to head the Commission.’ The ODP is now the sole agency for future relief distribution. It is perhaps interesting to note that the public did not seem unduly interested in the enquiry into the missing zinc, a violation of the scarce benefits dis
tribution system which could not be easily pinned on any single individual. And so ended another episode in Jamaica’s fast-growing culture of pork barrel politics.
The country had scarcely negotiated the zinc scandal when it was slammed by yet another, the 1991 Furniture Scandal.
The ’furniture scandal’ as it has been called, arose as a result of false invoices for goods and services allegedly supplied to the official residences of Parliamentarians in the present government, being submitted to the Houses of Parliament for payment. In some instances, genuine invoices on which items had been over-priced were also submitted.
The public was baffled and enraged to learn that in the absence of a guideline for furniture for the houses of ministers could be interpreted as a permit to go on a spending spree which involved the non-inspection of goods coming into the country, alleged over-pricing and actions which amount to fraud.
Edley Deans, Clerk to the Houses of Parliament, one of the witnesses in the case claimed that in the year 1990 to 1991, $600,000 was voted for furniture and furnishings, but was fast eclipsed by overspending of $3 million.
in November 1992 to defrauding the Government of more than $1 million in the $1.5 million Furniture Scandal case and were fined a total of $44,000.
On diverse days in 1990 with intent to defraud, they obtained from the Government of Jamaica a total of $1,010,935.02 by falsely pretending that they were entitled to the said amount as payment for goods and services supplied by the companies and claimed on invoices. The Resident Magistrate’s hands were tied. He could not go beyond what the law states that a company should be fined for such an offence. Section 268 of the Resident Magistrate (Judicature) Act states that the maximum fine is $4,000.
Under the Customs Act a company which has uncustomed goods is fined three times the value of the goods.
ute Saddler and his wife Michele, directors of the companies were withdrawn after Glen An
drade, Q. C. Director of Public Prosecutions offered no evidence against them. They were charged jointly with the companies and Robert Hill, an inventory clerk formerly employed to the House of Representatives.
Hill had been accused of causing and attempting to cause valuable securities to be paid out and conspiracy to defraud the government of $1.5 million between December 1989 and February 1991.
Count 1 of the indictment charged Hill with conspiring with persons unknown between the month of December 1989 and February 1991 to defraud the Government of Jamaica by falsely representing that they were entitled to payments for goods and services supplied to the Government as claimed on the invoices submitted for payments. The other six counts charged him with causing valuable securities to be delivered by means of false pretences.
On February 5, 1993. He was sentenced on all seven counts to serve 14 years in prison but served only two as the terms ran concurrently. But the embers from the sordid furniture mess refuse to die, and the Furniture Scandal once again resurfaced in court this year. This time, one of the three companies which pleaded guilty in November 1992 to obtaining money by false pretences arising from the scam, is pursuing legal action in the Supreme Court against the Government and Robert Hill, a former inventory clerk employed to the Houses of Parliament. The company, Stepshonics Ltd., wants to recover $500,000 allegedly owing to it for goods supplied.
In the latter part of that ill-fated year, in November 1991, the incident hitherto known as the Shell Waiver issue broke big time, It was not a scandal in the true sense of the word in as much as an concerted and deliberate effort to defraud the Government. However, it represents an unbelievable case of bureaucratic bungling by the Cabinet ministers who had contact with the issue.
The incident involved $29.5 million in duties which was waived in favour of Shell Company (West Indies Limited) and which caused the resignation of ambassador at large and a close confidante of Prime Minister Michael Manley, executive chairman of Petroleum Corporation of Jamaica (PCJ), Eli Matalon.
The political fallout was tremendous as it also prompted the subsequent resignation as Minister of Energy and Mining of Horace Clarke, and that of the then Minister of Finance, P.J Patterson.
Details from the scandal revealed that it was Mr. Clarke who recommended the waiver to be granted and Mr. Patterson who agreed to it. In his resignation letter Mr. Clarke also admitted that the ultimate decision to grant the waiver was his.
Mr. Matalon had been adamant that Shell should pay the punitive duties which had been lev
ied, because after the duties on the first shipment of unleaded petroleum had been waived, Shell had been told specifically that if it continued to import the product, it would be charged all duties. He explained that he had resigned as he had no alternative after he learned that the waiver had been granted because he had consistently opposed the waiver as part of his actions at PCJ, where he had explained to the board that they should abide by the Cabinet’s decision taken in July of 1990, in the interest of the viability of Petrojam.
Some schools of thought argued that the decision to grant Shell the waiver was in the interest of the motoring public and therefore was sound from a political (ministerial) stand point. Mr. Matalon is of the view that Shell should pay the punitive duties even if it means that Petrojam has to pay too, even if the cost of unleaded fuel to the motoring public goes up.
Eli Matalon and Howard Hamilton, general manager of Shell Company (W.I.) Ltd, are seen to each represent the contending interests. At that time, Howard Hamilton was an influential member of the ruling party who became a figure of controversy first with his introduction of the Scratch and Win game and then latterly with the Shell waiver issue. He received the licence to operate a lottery when it was common knowledge that Government was against this type of activity.
Almost no regulations existed in May 1990 regarding custom and taxation regimes for petro
leum products. In fact, almost everything was imported duty-free: crude oil for Petrojam; avi
ation fuel for the airports, imported by Shell; finished petroleum imported for Tropicana; and the special gas imported by Shell for JPS’s gas-turbines in Montego Bay. The advent of GCT, deregulation of the indus
try and Shell’s move to import unleaded gas presented the government with the need to establish levies in a short period. It is out of this frenzied atmosphere that the recent imbroglio was hatched.
During 1990, at first through a Ministerial Order that was in September incorporated into a law, the government introduced five duty regimes that were the liability of ’non-refiners’. However, ’refiners’ were liable only for one of those: the equivalent of the old consumption duty (now GCT).
The loophole was created in 1990 to benefit Petrojam’s periodic importation of petroleum at times when its own refinery experienced a shortfall. Petrojam has never paid import duties regardless of what it im
ported and irrespective of what regulations were on the books, and the loophole which, naturally, permits duty-free entry of petroleum fuel, by preparing customs declarations that were filled-out with the same secret codes used by Petrojam to import periodic shipments.
The Shell waiver brought the year to its close like a train line of dominoes, with upheavals within the Cabinet of government, the resignation of Mr. Eli Matalon from the Petroleum Corporation of Jamaica setting in motion the domino chain of reaction leading to the downfall of Mr. Horace Clarke and the departure of Mr. P.J. Patterson from the Cabinet.
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