Credit card records revealed

Use and abuse probed

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On December 24, 2007 – the day before Christmas – someone walked into Kirk Jewellers at Bayshore Mall and used a Cayman Islands government-issued credit card to purchase a diamond-studded women’s Ebel watch for US$3,500. 

The purchase of the watch came to light as part of hundreds of records released through a Freedom of Information request detailing the charges on government-issued credit cards held by five current or former government ministers and four former or current chief officers.  

Although the name on the statement which details the purchase of the watch has been redacted, there are indications that the credit card was issued to the Ministry of Communications, Works and Infrastructure, which at the time, was headed by Cabinet Minister Arden McLean.  

When contacted initially last week about the matter of charges to his government-held credit card in general, Mr. McLean declined to comment, citing “contempt of court” issues regarding an ongoing criminal case. Subsequent attempts by email, telephone and text messages to reach Mr. McLean for comment about the watch specifically went unanswered as of press time. 

It is not known who in the ministry purchased the watch, nor is it known whether this purchase was made for personal reasons or for legitimate government purposes. Further, it is not known whether the amount was repaid, but the Compass is investigating this through additional Freedom of Information requests. 

FOI details  

The records released through the FOI request by a private citizen only detail the charges made and do not indicate the purpose of purchases. The records only relate to credit card statements of some Cabinet ministers and chief officers. The records – which date back to 2005 and run through 2013 – are incomplete in that they don’t include statements for the entire period in which the person held his or her position.  

In many cases, the records indicated the person who held the card, as was the case with the statements relating to then-Cabinet Ministers Kurt Tibbetts, Juliana O’Connor-Connolly and Charles Clifford, as well as Chief Officers Gloria McField-Nixon, Donovan Ebanks, Kearney Gomez and Alan Jones.  

In the case of Cabinet Minister Arden McLean, some of the credit card statements identify him as the cardholder, while others grouped in the same portion of records do not. The card statements relating to former Cabinet Minister Mike Adam do not identify him as the card holder, however in subsequent telephone conversations, Mr. Adam confirmed at least some of the statements referred to the credit card he held. 

The credit card charge for the watch was one of many purchases made at various retail stores. After investigation into many of those charges, it was learned that some of them were for personal reasons but were repaid by the person using the card. In other cases, what at first glance appeared to be personal charges were actually for government business. 

Shopping trip 

Another expense identified as personal on a government-issued credit card was accrued by former Deputy Premier Juliana O’Connor-Connolly on April 2, 2010, at a Syms clothing store in Fort Lauderdale, Florida.  

When asked about the expense, Ms. O’Connor-Connolly identified the expense as personal but indicated she repaid the US$1,179.96 in cash within a week of the purchase.  

According to an April 8, 2010, memo concerning the repayment: “Minister [O’Connor-Connolly] was on vacation last week and due to circumstances beyond her control, had to use the government credit card to make a purchase.”  

Ms. O’Connor-Connolly provided receipts of the reimbursement that were signed by a ministry employee.  

Mistaken identity  

Former Leader of Government Business Kurt Tibbetts also had a number of items charged to his government credit card that appeared to be for personal use at first glance, but the Compass learned through further review that they were not used for such purposes.  

One charge of US$494.64 at shaperimage.com involved a purchase by staff members in Mr. Tibbetts’s former Ministry of District Administration for a 2006 hurricane conference in Florida. Mr. Tibbetts did not attend the conference, but he authorized staff to make the purchases which were then brought back to Grand Cayman for business use.  

A Nov. 13, 2006, charge at the Moss Bros store in London, for US$142.18 was for formal wear Mr. Tibbetts rented to attend a royal function at Buckingham Palace.  

“I simply didn’t own a tuxedo at the time,” the former Cayman Islands leader said.  

Another expense of US$456.86 at Marshalls on Mr. Tibbetts’s government-issued credit card did not refer to the U.S.-based clothing store, but to a hotel and restaurant in the British Virgin Islands. This amount went for “attendance at a meeting of CARICOM [the Caribbean Community]” held there in July 2006.  

Chief officer cards  

Retired former Chief Officer Kearney Gomez used his government credit card between 2007 and 2008 for a number of local retail stores and at Bed, Bath & Beyond in Lakeland, Florida. However, Mr. Gomez said all of the charges were for government business. 

“I bought hurricane supplies for the ministry,” he said, adding that one of the larger charges – US$459.81 at Harbour House Marina – was for life jackets for the ministry.  

With regard to the US$96.23 at Bed, Bath & Beyond, Mr. Gomez said he bought a number of 100-watt DC-AC inverters for charging telephones and other electronics through vehicle batteries as part of his ministry’s hurricane kit. 

“I called the ministry yesterday and they said they’re still there if anyone wants to see them,” he said last week. 

Mr. Gomez said that prior to getting the government credit card, he used his own credit card to buy materials for government. “A lot of times I didn’t even get reimbursed for it,” he said, adding that he had always been strongly against anyone using government credit cards for personal use. “I can say unequivocally I never used a government credit card for personal use.” 

After hearing his name on a radio talk show in the context of suggested inappropriate usage of his government credit card, Mr. Gomez said he had contacted an attorney in relation to a possible lawsuit against the station. 

“I consider it an egregious act,” he said. “You shouldn’t air something on a talk show without finding the facts behind it. It’s my reputation at stake.” 

Other unknown charges  

There were some other questionable charges noted in the records where the user could not be identified.  

Some are relatively minor expenses, such as a US$82.48 charge to Cost-U-Less in Grand Cayman by “credit card holder C” on Nov. 12, 2008, and another charge of US$50 at Tortuga Rum on North Sound Road dated Dec. 30, 2011, was made by a “credit card holder A.”  

Larger charges listed on a Royal Bank of Canada account statement that was sent “care of ministry of communications, works and infrastructure” listed a US$1,896.84 charge to “paradise island vacation 800-285-2684” and an additional US$238 in charges to “away we go charters.” 

Those charges were incurred between Aug. 5 and 19, 2009, according to credit card records.  

Another case where there was an unknown charge relating to a card held by Chief Officer Gloria McField-Nixon involved an amount of US$121 billed by the “Gamboa Resort Counter” in Panama on Dec. 13, 2007. 

“I have never traveled to Panama on official business or otherwise,” said Mrs.
McField-Nixon. 

Known problems  

The government’s internal audit unit revealed in 2010 – around the same period the FOI request concerned – that more than CI$190,000 worth of purchases made on credit cards issued to high-ranking members of the Cayman Islands government essentially could not be accounted for because no receipts for those purchases had been submitted. 

The expenses were incurred during the government’s 2008/09 budget year. The government’s Internal Audit Unit studied 1,125 credit card transactions between July 2008 and June 2009. Of those, supporting documentation for transactions totaling $190,594.32, about 10 percent of the 1,125 purchases, could not be provided. 

“Therefore, we were unable to determine if these purchases were for legitimate government business,” officials with internal audit noted in their February 2010 report. 

Moreover, the auditors expressed concern that credit card purchases – which are typically made by government chief officers, ministers and department heads – were being reviewed by subordinate staff members. 

“Monitoring (credit card) usage by subordinate staff inherently lacks independence,” the report noted. “This review process as a control is inherently compromised and therefore increases the risk of misuse of the credit cards.” 

In May 2014, the Office of the Auditor General issued a report on the management of travel and hospitality expenditures. In that report, the auditor general noted that the Legislative Assembly resolved on May 16, 2001, to grant corporate credit cards to ministers, official members of Cabinet and chief officers “with the objective… to allow official members and senior civil servants accessibility to an efficient means of payment for approved expenses, especially in relation to business travel, official entertainment and other types of expenses.” 

However, the auditor general noted that an official policy on the usage of the credit cards wasn’t issued by the Treasury Department until July 2010. That policy required proof-of-purchase documentation in order to verify charges listed on cardholders’ monthly statements; a completed and signed expense claim form; and receipts, or in the absence of receipts, a written explanation that included a description of the item(s) purchased, the date of purchase, the vendor’s name and the reason for the lack of supporting documentation.  

The credit card statements released through FOI also revealed extensive charges for travel and official hospitality purposes, which will be detailed in a future Cayman Compass article. 

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13 COMMENTS

  1. Why anyone would think that it is appropriate to use their business credit card for anything other than legitimate business expenditure is beyond belief. I don’t even think you should need a formal policy to tell you that you need to keep receipts for all business related expenditure as that is just common sense.

    What is apparent is that a culture existed where some people thought it was acceptable to use their government credit cards for personal purchases but in the absence of a formal card usage policy it will be difficult to hold anyone responsible for the misuse of these cards.

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  2. I note on several statements that interest and late charges appear. That is sloppy. I think the Auditor General should ascertain why the Government does not make timely payments. We all know the the very high interest rates charged by credit card companies.

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  3. Wow. And frightening.

    I do not know of any legit businesses where personal and business expenses are co-mingled even if reimbursed subsequently.

    I guess we now know why we have a crippling debt load that requires increased in taxes and duties every few years, the govt’s own pension plan that has been owed near 200m and will continue to be owed for another 10 years, approx. 1.1b in future health care liabilities that has NO money set aside to pay for such (just for the civil service), and selective financial reporting that claims we have a 100m surplus but there are other items still to be paid for the govt to normally operate.

    Using the taxpayers money for personal use. Enough said. Lets give some young candidates a kick at the can next election. This is not working.

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  4. Finance again!.. lets all give the Finance minister our support, after all he holds the key to our flexible in- adherence to policy or lack there of.

    The finance minister is doing an outstanding job, the Auditor General and the Compass are just big bullies..

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  5. The danger is that it sets a bad precedent.

    If a senior staff member makes a luxury purchase on a government card, and a more junior member of staff sees only half the picture e.g. the store receipt or statement but not the repayment, they may jump to a wrong conclusion and subsequently believe it is acceptable to use public resources for their own personal use. In that situation they would not they question or report colleagues who they saw misusing the public purse.

    Politicians are not better than everyone else, but they must lead by example and behave better than everyone else.

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  6. Playing devils advocate for a moment,

    If we consider the recent case of the bank teller who received a custodial sentence for an 800 theft.

    Hypothetically speaking, Lets say a government card was used for an 800 personal expense which was never subsequently re-payed…

    Would the public consider that to be the same, a more serious, or a less serious offence than the bank teller? Which is the greater abuse of trust?

    Maybe an opportunity for a poll (Editor?)

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  7. Mis-use of corporate credit cards for personal gain is corruption, pure and simple. There’s really no excuse for it – except I thought I could get away with it.

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  8. I’d like to know if they paid duty on the things they brought home from these shopping trips, like the US1,179.96 spent by Ms Julie, did she claim it on the way home ? or is that just for the little man..

    Sounds like another FOI request to me..

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  9. If this is what occurs at the top from those we entrust the country to, then we should not at all be surprised when the UK lists us as high risk.

    If this occurred at the corporate level you would be fired. And on the spot.

    What is even more frightening is what we don’t know and/or is disclosed. A very fine job by the investigative reporter. We really need to clean up our act people.

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  10. One of the ironies of this story is that CIG not only vetted all the credit card charges submitted by the Met during the early (covert) days of Operation Tempura but refused to reimburse GBP10,000 when the team failed to produce proper receipts.

    Which seems to suggest that CIG can do it if they really want to.

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