Howai says $62M NEC fraud involved mostly foreigners

The Chairman of the National Gas Company (NGC) told local media Monday he was told that the $62 million attempted fraud at National Energy Corporation (NEC) involved foreigners. NEC is a subsidiary of the NGC.

Larry Howai, who is also CEO of First Citizens Bank, added that the bank has reviewed its procedures to prevent a repeat of the fraud.

"Certainly, it is something that has us very concerned and it is something that we have spent a lot of time looking at in terms of the systems and so on within the organisation," Howai told the media. "I don't want to speak too much about the nature of it because it is subject to certain procedures we are now looking at."

Energy Minister Kevin Ramnarine announced earlier this month that the fraud was discovered in late September, 2011 while officials were going through the state company's banking records.

The minister said once the fraud was discovered officials reported it to the company's bankers, First Citizen's Bank (FCB), and the bank made efforts right away to put a freeze on the funds and recover the money.

Ramnarine said the quick response resulted in the recovery of half of the money and almost all of the rest has so far been frozen.

He said the NEC has been able to get back US$4.6 million, meaning another US$5M is still to be recovered.

Four NEC employees have been sent on administrative leave with pay. The minister confirmed that some bank employees have been suspended. However he did not name anyone due to the sensitivity of the investigation.

He said to date FCB has been able to block 98% of the funds on behalf of the NEC. In addition it has alerted Interpol, the local Fraud Squad and the FBI. The bank is also using the services of international private investigators.

Ramnarine told reporters that because of Howai's close connection to both the bank and NEC he agreed to recuse himself from the investigation.