Claiming that initial requests for government documents came up short, the Commission of Inquiry grilled Premier Andrew Fahie and his staff last month about contracts awarded to consultant Claude Skelton-Cline and barges rented from EZ Shipping, among several other topics, according to a transcript published May 27.
Mr. Fahie appeared before the commission on May 18 alongside Premier’s Office Permanent Secretary Dr. Carolyn O’Neal-Morton and acting Financial Secretary Jeremiah Frett according to the transcript (to view the full transcript, click here).
Commissioner Sir Gary Hickinbottom and COI Counsel Bilal Rawat sought explanations from Dr. O’Neal-Morton and Mr. Frett concerning missing documents and other topics, and they asked the premier about his personal relationships, his decisions on the territory’s pandemic response, and more.
Permanent secretary
Many of the COI’s questions for Dr. O’Neal-Morton, who appeared first, centred around a series of no-bid contracts awarded to Mr. Skelton-Cline’s firm Grace Counselling and Consultancy Centre starting shortly after the Virgin Islands Party came to power in the February 2019 general election.
After the first was awarded in March 2019, government announced that Mr. Skelton-Cline would have various responsibilities under a six-month deal worth almost $100,000: advising on the creation of a climate resilience and renewable energy unit; leading negotiations on the development of Prospect Reef; and establishing new terms of service from the territory’s telecoms providers and a new cruise line berthing agreement, among others.
After the initial six-month period, Mr. Skelton-Cline’s firm received more contracts, but none of them have been provided to the public in spite of recent promises from the premier.
While questioning Dr. O’Neal-Morton last month, Mr. Rawat said the COI received copies of Mr. Skelton-Cline’s contracts and “a set of payment documents, invoices and the like” recording government’s compensation to his firm.
However, he added that the Premier’s Office provided little to no documentation on how the government selected Mr. Skelton-Cline’s firm or how his progress was assessed.
Dr. O’Neal-Morton, who was appointed permanent secretary in March 2020, said she wasn’t sure whether pre-contract documents exist.
She added that records were lost in the 2017 hurricanes, and the issue was compounded when the office moved last year.
The commissioner, however, responded that the requested documents couldn’t have been lost in the hurricanes, which struck about a year and a half before Mr. Skelton-Cline’s first contract.
“It seems highly unlikely that you won’t have any pre-contract correspondence that existed before [former Premier’s Office Permanent Secretary Elvia] Smith-Maduro signed this contract,” Mr. Rawat said.
He added that the first contract, for March 25, 2019 to Sept. 17, 2019, was worth $99,780, and it allowed the firm to claim expenses and a tax-free gratuity of five percent upon satisfactory completion of the contract.
“You are giving nearly $100,000 of public money to someone for six months’ work,” Mr. Rawat said. “At the moment, we don’t know, because it hasn’t been provided, what representations Grace Consulting made to the Premier’s Office as to what they could and could not do.”
The permanent secretary promised to check her office’s files again for such documents.
Missing reports
Mr. Rawat said another no-bid contract — this one for 12 months of work starting Sept. 18, 2019 — was worth $144,000, in addition to travel and accommodation expenses that would need to be approved by the permanent secretary.
This contract, he said, required Grace Counselling to send the financial secretary and premier monthly progress reports, which Dr. O’Neal-Morton conceded should have been kept on file.
But Mr. Rawat said only two of the 12 reports were submitted to the COI.
He added that the commission might seek the rest of them in another letter of request.
Dr. O’Neal-Morton also explained that contracts totalling more than $100,000 would be supervised by the Ministry of Finance even if they were funded by the Premier’s Office.
Due diligence
Mr. Rawat also asked more broadly about the due-diligence process for assessing in advance whether or not contractors are able to complete the work set out in an agreement.
Dr. O’Neal-Morton, a long-time public officer who previously served as PS in the then-Ministry of Education and Culture, said information about their capabilities is typically covered in their initial proposal.
Mr. Rawat pressed further.
“Do you know if the Premier’s Office was aware that Mr. Skelton-Cline, who is Grace Consulting, had previously been criticised by the auditor general in relation to his work on the Neighbourhood Partnership Project?” he asked, referencing a 2009-2010 project that ended amid recriminations and questions over Mr. Skelton-Cline’s use of nearly $572,000 in taxpayer money.
Dr. O’Neal-Morton responded, “I’m not sure that I’m aware of it.”
Mr. Rawat also pressed her on who would be responsible for investigating a consultant’s proposal, what policies guide the office in making a decision to award a contract, and who monitors its progress.
“It varies depending on what the person is going to do,” she said. “If somebody’s applying to provide legal services, then of course they have to be a lawyer, a legal professional, and we can verify that easily, stuff like that. If the person wants — is a contractor, we can verify whether he’s a bona fide contractor or not by placing a call to the Ministry of Finance or to Public Works. We try to verify those things in that way.”
She also said she didn’t know if Mr. Skelton-Cline’s progress had been monitored, but she promised to search for any evaluation reports that may exist and send them to the commission.
Asked about other missing information, Dr. O’Neal-Morton at one point blamed the problem in part on a technicality: The Ministry of Finance and Premier’s Office worked jointly to fulfil the COI’s request, but the separate “Office of the Premier” wasn’t involved as far as she knew, she explained.
Financial secretary
After speaking with Dr. O’Neal-Morton, the commission called Mr. Frett.
During his session, they focused largely on barges rented from EZ Shipping to assist with border security, but they also asked more about Mr. Skelton-Cline’s contracts.
First, though, Mr. Rawat told Mr. Frett that the Ministry of Finance had provided multiple sets of incomplete documents to the COI, including some files that included only odd-numbered pages.
Mr. Frett, a long-time public officer who was appointed acting financial secretary in January, explained that such errors likely were a result of staffing shortages in the ministry.
“I would say that the Ministry of Finance was the centre point for requests from the Commission of Inquiry,” he said. “Based on the volume of information we provided to the Commission of Inquiry, that’s very likely that incidences like this may have occurred, but I guarantee it’s not out of [not] wanting to provide the information.”
Missing reports
After the questions turned to the Ministry of Finance’s role in overseeing Mr. Skelton-Cline’s $144,000 contract, the commission asked Mr. Frett about the missing monthly progress reports and “the process by which you look at reports and critically evaluate whether someone is performing their contract.”
Mr. Frett responded, “With respect to this particular contract, there was no — from my knowledge, I don’t think there was a set standard of analysis because of some area that was broad in scope. … The nature of some of it was more revenue-generating-type activities that we were to review.”
The commission also asked for records of any communications between the Ministry of Finance and Grace Counselling leading up to the contract agreement.
Mr. Frett said he would try to provide them, along with any other additional documents requested by the COI.
The commission also asked about Mr. Skelton-Cline’s current contract.
“We understand that Mr. Skelton-Cline currently has a contract with the government in the same terms” as the previous 12-month deal, Mr. Rawat said. “Are you now, as acting financial secretary, receiving reports from Mr. Skelton-Cline?”
Mr. Frett responded, “Commissioner, we continue to receive reports, and I would say that I did receive some — a huge bundle. I didn’t have an opportunity to go through it, but I’m sure it probably was supply of activities surrounding all that he did so far.”
Mr. Rawat asked when he had requested the “huge bundle.”
“I can’t say,” Mr. Frett said. “It had to be months ago. It was part of us getting the information to submit to the Commission of Inquiry because, as financial secretary, I said I need to see all of the reports that was completed so I can make copies for submission to the COI.”
Mr. Rawat asked who provided the bundle, and Mr. Frett replied that Mr. Skelton-Cline gave it to him.
“Commissioner, it was easier for me to go to him than — as I stated, we are dislocated right now because of Covid and relocation from the admin complex, [and the] filing room is in a total different building from where we operate from, and I thought it was easier for him to provide all of the reports that may have been submitted — that would have been submitted — so that we could have copies and submit,” he explained.
Mr. Rawat inquired further.
“As I understand it, the commission hasn’t sent you a letter of request in relation to Grace Consulting or Mr. Skelton-Cline, but you took it upon yourself to contact him and obtain information from him?” he asked.
Mr. Frett confirmed.
“And have you done that in relation to any other people?” Mr. Rawat continued.
Mr. Frett answered in the negative. Asked why he requested documents only from Mr. Skelton-Cline, Mr. Frett responded that the consultant is a “respected public figure” who “has a talk show, and I think it was appropriate to clarify to make sure that whatever he was supposed to do with regard to the financial secretary, that we have the necessary documents in place.”
The commission did not explicitly request the bundle during the hearing, but Mr. Rawat said it would send Mr. Frett a list of requested documents. Mr. Frett said he would do his best to provide them.
EZ Shipping
Mr. Rawat also asked Mr. Frett about government contracts to rent barges from EZ Shipping to accommodate border-control officers at sea during the pandemic.
In the process, the counsel sought more information about how the firm was chosen, what other options were available, and why typical procedures for approving three contracts awarded to EZ Shipping for the period Aug. 23, 2020 to Jan. 23, 2021 apparently weren’t followed.
“A common feature of all three contracts is that they’ve been signed after the contract period begins, and I think in the case of the last two it’s after the contract has even ended,” Mr. Rawat said. “Now, can you explain why that happened?”
Mr. Frett replied that given the urgent need to protect the territory’s borders during the pandemic, the Joint Task Force and the National Security Council moved forward with procuring the barges despite a “lagging” payment process.
“We try our best, based on scenarios that occurred, to try to be more timely in execution of the contracts prior to the work, but because of the urgencies and the situation that arise, as noted, it almost came to a month-to-month type situation because there was other dynamics currently happening in trying to come up with a more permanent solution,” Mr. Frett said.
But that solution never came, according to the financial secretary. He added that entering into substantial contracts after the work has been completed isn’t a common practice outside of emergency situations.
Selection process
The commission then asked about the process for deciding that the EZ Shipping barges were the best option.
Mr. Rawat said documents provided to the COI suggest that three companies were asked to submit quotes, and he asked who reviewed the proposals.
Mr. Frett said the Joint Task Force was responsible for making a recommendation, and he agreed to provide communications with members of the JTF about their decision-making process and with EZ Shipping about the contract terms.
Mr. Rawat said one of the other companies to show interest was Caribbean Transport, but he didn’t name the other.
Premier’s hearing
After Mr. Frett’s hearing, the premier appeared before the commission and answered questions about his political affiliations as well as the EZ Shipping agreements, Mr. Skelton-Cline’s contracts, and other topics.
Early in the proceeding, Mr. Rawat called Mr. Fahie’s attention to a May 6, 2020 proposal he said EZ Shipping owner Clyde Chalwell apparently sent unsolicited to the premier, governor, police commissioner and financial secretary.
Then he asked the premier if he and Mr. Chalwell are friends.
“In politics, I don’t keep any enemies, so everyone is my friend,” the premier replied. “Is he a closer friend than others?” Mr. Rawat pressed.
“I don’t keep close friends, but I keep friends,” Mr. Fahie responded.
Previous business?
Questioned further, Mr. Fahie said he didn’t recall doing previous business with Mr. Chalwell.
Mr. Rawat also asked, “Do you yourself, premier, know how it came about that Mr. Chalwell decided to make this unsolicited proposal to you?”
Mr. Fahie replied, “I would say, in general, this is not uncommon at all in our culture. People meet you as elected official, as premier, or otherwise, and tell you about businesses that they’re interested in and would the government be interested.”
When approached in this manner, he said, he explains the importance of following proper protocols.
“So, I respectfully receive these things from many persons over time, and I would always direct them to the right channels so that they can get their affairs dealt with in the correct manner,” he said.
Asked if he had been approached by Mr. Chalwell before the proposal was sent, he replied, “Not as far as I can recall.”
Why the barges?
Later in the hearing, he explained more about the decision to rent the barges, which he said was guided by the Joint Task Force that was established in April 2020 with immigration, customs and police officers.
“In the beginning they were renting smaller boats, and the smaller boats caused a concern with a lot of the officers,” he explained. “First of all, they were concerned — and they stated through their head of their units, who reported to [National Security Council] their concern — for their safety on the water. Second of all, the smaller boats, based on what they reported to us, could not stay out on those waves or waters too long.”
Mr. Rawat later asked how the Joint Task Force shared information with the National Security Council, and if it produced written reports about its pandemic mitigation efforts.
“When we received the report, most times it was not a written report,” Mr. Fahie replied. “They would come … right in this room, and they would sit social distance, and they would give their report, and that would be the bearing off of what we would make decisions off of.”
Sometimes, he added, those decisions had to be made quickly given the urgency of the pandemic situation.
“The Public Finance Management Act was flexed a little bit for all the agencies to be able to get whatever is needed at that time to make sure we protect the BVI,” he said, adding, “We were projecting in the beginning if we did nothing, we would have within a few weeks’ time 3,700 corona cases.”
As for approving the use of the barges, Mr. Fahie said he agreed to use them based on the circumstances of the unpredictable pandemic and feedback from the Joint Task Force that it had considered a shortlist of candidates for the job.
He noted that then-Police Commissioner Michael Matthews was “not a fan” of the barge plan, but said the Immigration and Customs departments supported it.
“The then-commissioner of police also supplied some documentation of one [proposal] where persons wanted to give smaller boats for free,” Mr. Fahie said. “The issue with that, my professor in college told me anything free means one of two things: Somebody paid for it already or somebody will pay for it after.”
He added that the international Financial Action Task Force recommends against accepting free gifts for law enforcement agencies.
Skelton-Cline contracts
The commission also sought clarity about the origin of the government contracts with Mr. Skelton-Cline.
“Was Mr. Skelton-Cline invited to submit a proposal to your office?” Mr. Rawat asked the premier after quoting a statement Dr. O’Neal-Morton reportedly gave to BVI News in April 2020 stating that Mr. Fahie’s administration invited Grace Consultants to submit a proposal to secure its initial contract.
Mr. Fahie questioned the veracity of the news report and said Mr. Skelton-Cline approached him after the 2019 elections and “said that he can help with finding different ways for new investments to come to the BVI.”
Mr. Fahie said he told Mr. Skelton-Cline that he would have to send a formal proposal to the Premier’s Office explaining what services he could offer.
“I was very careful with that because Mr. Skelton-Cline was known to be around all political parties during the campaign, so I asked him to present your documents and your details of what all you can offer to the Premier’s Office for consideration,” he said, later classifying the consultant as his political “supporter.”
He added that the Ministry of Finance was looking for a “catalyst” to spark major investments when later considering Mr. Skelton-Cline’s proposal.
Mr. Rawat probed, “You made the point that Mr. Skelton-Cline was known as someone in the election campaign that had been perhaps associated with your party, and you wanted to be careful. So, in this instance, did that care continue over into the assessment of the proposal?”
Mr. Fahie said yes, and noted that he urged “others” to keep careful accounts of their involvement as well.
He also said he stood by earlier reports of his intent to fire Mr. Skelton-Cline if he didn’t deliver on the contract terms.
Mr. Rawat asked, “And at any time did those on the technical side come to you and say, ‘Premier, this isn’t looking good; you need to think about this’?”
“I don’t remember such times,” Mr. Fahie replied.
Mr. Rawat also asked if any of the monthly reports Mr. Skelton-Cline’s firm was supposed to deliver crossed the premier’s desk.
“I would say that the reports after the first contract were discussed,” Mr. Fahie said. “One of the things that I remember in the discussion with the technical persons was that they were concerned if six months was sufficient time … to have produced the deliverables, and that’s where the consideration came on whether it should have an extension, but an extension would require Cabinet. And the then-financial secretary stated clearly, ‘Well, we will put in some more pegs, so to speak, so that we can make sure that we can see the progress by month.’”
Mr. Rawat also reviewed some of the advice Mr. Skelton-Cline provided in the reports the COI did receive, including a September 2019 recommendation to re-establish the Climate Change Trust Fund Board, which Mr. Fahie’s government disbanded shortly after taking office. Mr. Rawat asked if the board was re-established.
Mr. Fahie answered in the negative. With that body and other boards, he said, his administration is considering reinstituting them with new appointment guidelines in place.
‘Shores Development’
Another recommendation from Mr. Skelton-Cline, which came in a March 17, 2020 report, advised government to pursue the “Shores Development” by leasing Crown land and seabed at Brandywine Bay for 99 years to an interested developer, Mr. Rawat said.
“He says he met with the principals of Shores — Allison Petraus, Roy Garroway and [Deputy Governor] David Archer — to discuss the project terms and condition, and then he goes on to refer to an MOU document,” Mr. Rawat said.
But Mr. Fahie explained that after hearing feedback from residents, Cabinet did not approve the development.
The commission also asked Mr. Fahie if he was involved in appointing board members to the BVI Airports Authority as a member of Cabinet.
Mr. Fahie said yes but defended the appointment of Deputy Chairwoman Patsy Lake, his first cousin, based on her merit as a businessperson and public figure. In response to further questions, he said he couldn’t recall appointing any other known family members, or favouring “close friends.”
“What I would say is I do agree that we need to strengthen the policies of how boards operate and what — how this selection process is,” he said.
Corruption claims
The COI concluded Mr. Fahie’s hearing by exploring his claims when serving in the opposition from 2015 to 2019 that the previous administration was “corrupt.”
“You accused them of corruption,” Mr. Rawat said. “You accused them of being political pirates. You accused them of financial misappropriation. … Did you make such remarks?”
The premier confirmed that he did, and said he stands by his claims.
“There were actions that concerned me,” he said. “I didn’t hide then, and I don’t hide them now. And I’m always appalled that when we were in the opposition, we asked for commission of inquiries on these, and we were told by the governor that it would be too expensive to have a commission of inquiry.”