The Commission of Inquiry has suggested that House of Assembly Deputy Speaker Neville Smith breached section 67 of the Virgin Islands Constitution by failing either to vacate his seat or to obtain a timely exemption after his company entered into contracts with government.
But during a hearing on Tuesday, Mr. Smith told the COI he had reasons for his actions, explaining that he did not learn of some of the contracts until after they were signed and that others related to work agreements from before he took office.
During the hearing, COI Counsel Bilal Rawat asked about a list of “potential criticisms” included in a “warning letter” the COI sent Mr. Smith, as well as his responses.
One potential criticism suggested that Mr. Smith “acted contrary to and/or was in breach of section 67 of the Constitution” when on July 29 the House of Assembly voted to retroactively exempt him from vacating his seat for signing contracts with government as many as eight months earlier.
Mr. Smith’s company, Caribbean Security Limited, had entered into two contracts, in November and April, to supply information technology services to government agencies.
Section 67 of the VI Constitution requires HOA members to vacate their seats if they or their company contracts with government — unless they are exempted by the HOA after disclosing their interest.
Not soon enough?
According to the Constitution, this disclosure must come before the member becomes “a party to a contract, or before or as soon as practicable after becoming interested.”
In the “warning letter” described on Tuesday, the COI suggested that the July exemption didn’t come soon enough.
“‘As soon as practicable’ normally means as soon as possible,” said Commissioner Sir Gary Hickinbottom.
However, Mr. Smith disagreed. “Reasonable time, meaning that I know when it is,” he maintained.
He added that he did not know about the contract right away because his business partner Dave Dupree deals with the day-to-day matters of Caribbean Security.
“I pulled myself away from those entities since being elected,”
Mr. Smith said. “I’m a signatory on cheques, but I don’t know anything about contracts.” Although he said he was aware that a bid for the November contract had been submitted in February 2020, he added that he first became aware of the contract in January 2021 when his business partner informed him about it.
He then brought the matter to the House of Assembly, he said. However, Sir Gary said the Constitution is clear, calling section 67 “a really draconian section.”
“There’s no ‘reasonableness,’ or ‘whether you know about it’ or anything like that,” the commissioner said. “If you happen to be the director of a company which enters into a contract with the government, you have to vacate your seat.”
The commission also noted a letter from Speaker of the House Julian Willock, in which Mr. Willock takes some of the responsibility for the exemptions coming to the House as late as they did.
In the letter, Mr. Willock stated that Mr. Smith approached him several times between January and June 2021 asking that the declaration be placed on the order of the day.
“I had every intention to plac ethe declaration on the order of the day,” he wrote, adding that other issues took precedence over Mr. Smith’s “very important” matter. “I take responsibility for the omission.”
Further potential criticisms concerned the deputy speaker’s other contracts, for which he was not exempted by the HOA. The commission asked him about a contract Caribbean Security appeared to have signed with the Royal Virgin Islands Police Force in May 2020 for the provision and installation of various security equipment, as well as an “approved proposal” from November 2020.
Both the contract and the proposal, according to the commission, suggested that the company had engaged in other arrangements with the police not covered by the previous contracts.
But Mr. Smith said he did not consider those agreements contracts, noting that the business works with the police on an oncall, as-needed basis.
The “approved proposal,” he said, was probably for an add-on to a previous project. The work may have been ongoing from before he was elected, he added.
The commission, however, also found that Caribbean Security entered into a $15,980.24 contract with the government on Dec. 6, 2019 to purchase and install items for the RVIPF. That contract led to another potential criticism, which suggested that Mr. Smith “failed to obtain an exemption” from the HOA under section 67.
But he said he was not aware of that contract until Sept. 6, when he received the criticisms in a “warning letter” from the COI.
“Personally, as I’m not involved in the daily operation of the company, the contract fell through the cracks, and I was not notified of the contract,” Mr. Smith stated in his written response to the letter.
The commission also found that Caribbean Security signed a number of agreements with the BVI Ports Authority, including one in November 2020 for $39,350 to purchase and install information technology, which
the COI also described as another breach.
Mr. Smith was not asked to address the potential breach, but he was asked why correspondence about it came from his HOA email address.
“If someone who knows me has a question for Caribbean Security, they will contact me,” he replied, adding that he would then forward the correspondence to Mr. Dupree.
The company also signed invoices in 2019 for ongoing work for system maintenance and service that rolled over into 2020, according to the COI.
However, Mr. Smith said those invoices were for monitoring and servicing of systems previously installed.
Conflict of interest
Pointing out that Mr. Smith had benefited from four HOA exemptions already during his time in office, Mr. Rawat asked him how he would ensure that he was aware of future contracts so that no more breaches occurred.
Mr. Smith suggested that he would “send a letter to government itself, saying that any contracts that Caribbean Security enters into, it comes to me first.”
The commissioner, however, argued that this course of action wouldn’t address the fundamental conflict of interest of an elected member doing business with the government.
“Once you become an elected member, the general rule is no
contracting with the government, as an individual or as a member of a firm, or as a director, full stop,”Sir Gary said. “That is the rule.”
The exception would be if the member gets an exemption before entering into the contract, he said.
Sir Gary did, however, mention the long time it can take to draft the exemption declarations, adding that Attorney General Dawn Smith said it can take up to six months to get one through the House. “But looking at it from a governance point of view and conflicts of interest, [this does not seem] to be a system that is working as it should,” he said.