Dear Editor,

GHK Lall []( “‌”)., attacks the government, particularly the Vice President, Dr. Bharrat Jagdeo, on a daily basis. I rarely read his essays, but today, I wish to devote this essay towards examining his track record where he served as the Chairperson of the Board of Directors for the Guyana Gold Board, during the period 2017-2019, under the previous government.

The findings are damning considering the manner in which he projects himself as if he is someone of impeccable professional conduct and integrity of the highest order. Disappointingly, the reality is such that the evidences I am about to disclose hereunder, are to the contrary.


Source: Author based on Gold Board Annual Reports

Having examined the audited financial statements for the period 2010-2019, the Gold Board recorded profits in 2010 of $372 million, 2011 of $126 million, 2017 of $648 million and 2018 of $422 million. For the other years during this period, the Gold Board recorded losses owing to high cost of sales and price volatility. During this period, the highest average price per ounce was recorded at US$1,665 in 2011 which plummeted in 2013 to its lowest level of US$1,197 per ounce. The price did not recover to its pre-2013 levels until 2017 at US$1,320 and to US$1,479 in 2019 (see chart below).‌


Source: Author based on Bank of Guyana Annual Reports

That said, in order to minimize the impact of the losses owing to the foregoing factors, it is only prudent for the management and the Board of Directors, to ensure that the administrative expenses are kept as low as possible. Evidently, this was done under previous management during the PPP/C government’s tenure in the pre-2015 period. In this respect, administrative expenses increased modestly from $300 million in 2011 to $332 million in 2014, representing a cumulative increase of $32 million or 11% for that period. Conversely, administrative expenses recorded a massive increase from $293 million in 2016 to $413 million in 2019, representing a cumulative increase of $120 million or 41%―that is, nearly 4-times the level of increase recorded for the period 2011-2014.

Further examination revealed where the excesses went. (See table attached).


– Employment costs which amounted to $82.4 million in 2014 increased to $186.5 million by the end of 2019, representing a cumulative increase of 126%;‌

– Meal allowances which amounted to $1.153 million in 2014 increased by $3.330 million in 2019, representing a cumulative increase of 189%;‌

– Directors’ fees which amounted to $402k in 2014 increased to $2.619 million by the end of 2019, representing a cumulative increase of 551%; and

– Other expenses increased from $7.554 million in 2014 to $63.141 million by the end of 2019, representing a cumulative increase of 740%. Bearing in mind that it is unclear what are the expense items that made up the “other” expense line item in the financial statements.‌


Year: 2017

1. Administrative expenses – NRE

‌During the year under review, the Board expended the sum of $15,247,945 as payroll expenses on behalf of the Ministry of Natural Resources. The related expenses are not solely and exclusively incurred on the operations of the Board and as such deemed ineligible expenditure. Further audit inquiry revealed that there is no shared agreement between Guyana Gold and the Ministry of Natural Resources for such expenditure which has been recurring since 2012.

2. Disposal of Non-Current Assets

‌The Board disposed non-current assets totaling $21,180,846 as of December 31, 2017. However, such disposals were not approved by the Board of Directors. There appears to be a breakdown of internal controls and failure to comply with financial procedures as set out by the Ministry of Finance with regards to disposal of non-current assets.

‌Year: 2018

1. Dealers Licenses

‌During 2018, the Guyana Gold Board approved nine (9) dealers’ license to conduct gold trading activities including exportation of gold. However, the auditors found the following irregularities:‌

1. There were no documented standard operating procedures offering guidance for approval and issuing of dealers’ licenses.

2. There was no documented evidence of interviews being conducted by the Board of Directors prior to issuance of licenses in 2018. Moreover, in 2019, no objection was sought from the Minister of Natural Resources as required, except in one of the nine dealers’ files, evidence of no objection was on file.

3. Acquisition of non-current assets

The Guyana Gold Board acquired assets totaling $49.3 million as shown in the financial statements. Of this amount, the sum of $8.145 million for the purchase of generator set of $7.665 million and the supply and installation of CCTV cameras of $480k respectively, were sole sourced with the absence of quotations for comparability of prices and terms and conditions. Included in the total amount, $16.8 million for electrical works at the new location in Queenstown and acquisition of mercury abatement system was carried out by a contractor without any official contract document between the contractor and the Guyana Gold Board. The Board was experiencing significant delays with the contractor in the completion of and handing over of the mercury abatement system with 50% of the amount due paid. Consequently, in the absence of a contract, it would have been difficult for the Guyana Gold Board to institute penalties to carry out the remedial works required.

Year: 2019

1. Procurement Breaches

The auditors were unable to determine whether the Board followed established procurement practice in the selection for architectural consultancy services based on the value and scope of works required. The auditors were informed that a previous architectural consultant, Rogrigues Architect Ltd., was recruited by the Guyana Gold Board and his findings did not meet the Board’s approval. Subsequently, KNA Construction was invited to make their presentation to the Guyana Gold Board, and this was well received by the Board of Directors.‌

Further checks on the background of KNA Construction revealed that the company was registered on May 31, 2019, as a sole trader under the Business Registration Act after less than one month received a contract for a significant sum of money without adequate experience.‌

A site visit in February 2021 to the location at Lilliendaal, East Coast Demerara, indicated that construction work had not commenced. The auditors made several calls to the Office of the Permanent Secretary of the Ministry of Health for an update on the status on the construction of the Guyana Gold Board / Ministry of Public Health offices, but up the date of the report, no response was forthcoming.‌

Further, a detailed review of the evaluation report showed that three of seven bids were considered for technical and financial evaluation, thus were unable to determine reason (s) for disqualification of the other four bids. It should be noted that three of the four disqualified bids were below the engineer’s estimate by approximately $195.5 million.‌

Payment amounting to $10.4 million made by the Guyana Gold Board to KNA Construction was not recovered from the Ministry of Health. This amount relates to the proportion that relates to the construction of the proposed building of the Ministry /Guyana Gold Board at Lilliendaal, East Coast Demerara.‌

Other Procurement Breaches cited in the 2019 annual report include the following:‌

– A contract valuing $4 million was awarded to Big Boss Transportation Service for the clearing of land for the construction of the head office. Audit examination revealed that the Board did not adhere to established procurement practice such as using the three quotes system before the selection of a contractor.‌

– A contract for the sum of $16.660 million was awarded to Integrated Networks. However, auditors were unable to determine whether the established procurement procedure was complied with.‌

– A contract for the sum of US$288,000 (G$60 million), was awarded to Axis Guyana Inc., for the implementation of a Regulatory Compliance System. According to the contract, the amount represented one year cost for subscription payable in quarterly instalments. At the time of the report, total payments amounted to G$20.964 million to Axis, where management had nothing in their possession to show the benefits derived from the total payments made. The General Manager had expressed her discomfort at a previous Board meeting with the exorbitant contract price and how this cost could be burdensome for the Guyana Gold Board. But the Chairman of the Board of Directors (at that time/GHK Lall) insisted that this project must move forward. During the audit, the auditors were informed that the processing of further payments were placed on hold by the instruction dated August 21, 2020, by the Hon. Vickram Bharrat, Minister of Natural Resources.‌

Further review of this contract revealed several inconsistencies that infringed the tax laws of Guyana:‌

– There is a provision for exemption of taxes and duties on the importation of two off-road and two on-road vehicles. Similarly, under this contract the company also requested exemption from corporate taxes for the first three years of operations.‌

The auditors concluded that the Guyana Gold Board did not receive value for money in relation to the contract with Axis Guyana Inc., and that established procurement procedures were not complied with.‌

Author’s Comments

A perusal of the 2012 annual report revealed that the abovementioned discrepancy cited as audit finding (i) was not flagged as an audit finding for that year. It was also noted that in the 2012 annual report that the Ministry of Natural Resources provided tremendous technical assistance to the Gold Board. This explains why this transaction was treated in this manner in 2012. With the change of government in 2015 and change of management of the Gold Board, clearly all and sundry were clueless in terms of the correct accounting treatment and rationale for so doing, which kept recurring until 2019, although the Ministry did not provide that level of technical support in the following years.‌

In response to audit finding (ii) above, the management’s responses provided were inconsistent with whether the approval was granted and whether the established procedures were adhered to. Instead, management response was completely irrelevant wherein they stated that the policy was approved by the Board in 2013, and due to relocation of the office, couldn’t locate the document. This is an utterly unacceptable excuse to substantiate the foregoing breaches and irregularities.‌

In the 2018 audit report, this was cited again, and management offered a different explanation for the same issue, wherein they stated that the “Board had knowledge of the disposal since it was reflected in the financial statements”. Again, this is a grossly unacceptable explanation/excuse since this is not how the Board should operate. The transaction ought to have been properly approved by the Board in accordance with the financial laws before being executed.‌

Notably, the management response provided in relation to the above audit finding at (iv), did not address whether the remedial works were carried out. More importantly, the response did not adequately justify the reasons for the irregularities cited and whether the Board adhered to the correct procedures.‌

Concluding Remarks

In view of the foregoing egregious revelations, GHK Lall’s Chairmanship of the Guyana Gold Board was fraught with procurement breaches in excess of $120 million, financial irregularities and mismanagement of the agency’s financial resources, and unjustifiably exorbitant increases of the Guyana Gold Board’s administrative expenses.‌

It is worth noting that having perused the audit reports for the previous years prior to his Chairmanship of the Board from 2011-2016, it was confirmed that no such breaches, irregularities and mismanagement of the agency’s financial resources were ever conducted/cited prior.‌

As such, Mr. Gabriel Lall (GHK) is rather fortunate that the incumbent government did not pursue the requisite actions against him. The procurement breaches and financial irregularities cited in the audit reports during his tenure warrant him being prosecuted pursuant to the financial and procurement laws of the country.

‌Yours respectfully,

Joel Bhagwandin


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