Ebanks ordered to explain loans

The Public Accounts Committee is summonsing the former managing director of Boatswain’s Beach, Joey Ebanks, to give evidence after he failed to appear before the committee on Wednesday morning.

ebanks summonsed

Joey Ebanks

At the committee hearing, Mr. Ebanks was expected to answer questions arising from an Auditor General’s report into $65,870 made to him in loans and salary advances, as well as a $6,514 tab he ran up at the tourist attraction’s bar and restaurant.

Committee chairman Ezzard Miller said he would issue a summons ordering Mr. Ebanks to appear on 3 December, after United Democratic Party member Ellio Solomon, seconded by colleague Dwayne Seymour, put forward a motion to force the former managing director to respond to the issues arising out of the October 2009 report.

In Wednesday’s hearing, two senior officials from the turtle farm gave evidence – former chairman of the board of directors Joel Walton and the Chief Financial Officer Vijay Parabdeen.

The committee heard that Mr. Ebanks paid back the remainder of the loans he had received while he worked at Boatswain’s Beach in May this year in a single cash payment of $55,544.

Under financial reporting laws in Cayman, the source of large cash deposits to banks must be disclosed. It was revealed that the repayment cash from Mr. Ebanks was deposited in the First Caribbean Bank under the description ‘business operations’.

Where Mr. Ebanks, who was on a salary of between $125,000 and $150,000 a year, would have secured more than $55,000 in cash, was not queried by Mr. Parabdeen, nor the current managing director Joseph Parsons, who received the cash directly from Mr. Ebanks.

Mr. Parabdeen told the committee: ‘To be quite honest, we were just relieved to actually receive this amount back,’ adding that he and Mr. Parsons had assumed Mr. Ebanks had borrowed the money and they had no reason to believe it came from a suspicious source.

Mr. Solomon expressed concern that a government-owned entity like Boatswain’s Beach could circumvent financial reporting regulations by receiving a large amount of cash without querying its origin and then deposit that cash, claiming it came from a different source.

The board of directors only became aware of the existence and extent of the loans made to Mr. Ebanks after he resigned from his position to run as a People’s Progressive Movement candidate for North Side in May’s election.

Mr. Walton agreed with the Auditor General’s findings that there were no procedures or policies in place to authorise loans to a managing director. He said Boatswain’s Beach has an employee handbook that states that salary advances to staff can be authorised by the managing director, but there was no regulations in place covering how a managing director would receive a salary advance or loan.

Mr. Parabdeen came under fire for not informing the board of directors that Mr. Ebanks was effectively granting loans to himself when Boatswain’s Beach was losing up to $600,000 a month. He said he been busy trying to update annual audited financial statements and implementing a records and accounting system that would better keep track of finances at the turtle farm.

He said Mr. Ebanks had told him that he would not ask for further loans, but then proceeded to do so. He described the situation as an uncomfortable one over which he had ‘agonised’.

‘[Salary advances] should be exceptional … and the employee manual did give powers to the MD to approve salary advances and to make exceptions where he felt there was a need to make exceptions. When it becomes that the MD himself is the one who is making exception for what is obviously for his personal benefit, the system of control more or less breaks down and that’s what transpired,’ Mr. Parabdeen said.

Members of the committee queried if there had been collusion over the unauthorised loans because cheques over a certain amount could not be signed by just one signatory.

Auditor General Dan Duguay said a payment slip was signed by Mr. Ebanks and Mr. Parsons in relation to a loan for $5,000 in February 2009. In January, a loan for $11,679 was taken out, and a form relating to this was signed by Mr. Parabdeen. Another loan of $15,500 was preceded by an email from Mr. Ebanks to Mr. Parabdeen asking for the loan as well as a full account of how much money the former managing director owed Boatswain’s Beach. Another loan that month for $3,000 was signed by Mr. Parsons.