Gov’t credit card policy “doesn’t apply”
There exists a clear disparity between the civil service’s credit card policy and whatever rules may apply to the authorities and companies that are a part of the Cayman Islands public service, but which operate independently of the central government.
The Cayman Compass can reveal the gaping hole within government rules after finding that cash advances were recorded on government credit cards issued to the Cayman Islands Maritime Authority for years after a government policy expressly forbid those cards being used for such a purpose.
However, it appears that a July 2010 government policy did not, and still does not, apply to anyone employed in the statutory authorities or government companies that operate via government-appointed boards of managers.
“I will discuss further whether the [credit card] policy should apply to statutory authorities and government companies,” Deputy Governor Franz Manderson said, responding to Cayman Compass questions about the issue. “This is something I’m going to take forward with our elected leaders.”
The Maritime Authority, which registers sea vessels in the Cayman Islands and conducts inspections of those vessels worldwide, is a statutory authority of the Cayman Islands government.
According to a government statement, the current credit card policy applies to the following individuals: Ministers of Cabinet, official members of government, chief officers, heads of departments and other staff members who obtained explicit approval of the financial secretary to use the government cards.
“I can confirm that the policy document on credit card usage does not apply to statutory authorities and government companies,” said Michael Nixon, government’s deputy chief financial secretary.
The policy, issued on July 2, 2010, states in point No. 6: “Cash advances on credit cards are not allowed.”
Credit card statements obtained by the Cayman Compass showed a number of instances where cash advance fees were charged to the Cayman National Bank card held by Maritime Authority chief executive officer A. Joel Walton between June 2011 and April 2014. Other cash advance fees had been charged to the credit card prior to the advent of the government policy.
The cash advance fees and some associated financing charges on the card, according to statements provided, were not for large amounts. Between June 2011 and April 2014 in statements reviewed by the Compass, the total amount in cash advance fees was less than $200.
Cigars and gifts
Government credit cards issued to the Maritime Authority were used during 2008-2010 to buy hundreds of dollars worth of gifts for authority staff members.
Those expenditures included $423.75 at the Noah’s Ark store for an employee who had just had a child. A similar purchase of $189.94 at Little Darlings followed for another staff member who gave birth.
More charges of $61.43 and $140 were made on authority credit cards at Kirk Jewellers in Bayshore Plaza on gift certificates for staff members who were leaving the authority.
Some of the gift-related charges were made on the government credit card held by former authority administrator Kathryn Dinspell-Powell. When asked about it, Mrs. Dinspell-Powell said she was told by senior staff to make the purchases, and that these were all considered business expenses.
“Gifts on special occasions…that are within reason are part of the staff reward/recognition policies of organizations,” Mr. Walton said. “The amount for each such award is pre-approved before the purchase is made.”
Other credit card records show thousands of dollars spent on cigars in Cayman and abroad.
For instance, one such expense of $180.40 at the Havana Club Lounge in Cayman was for “official entertainment,” according to authority records.
Another expenditure of $858.91 on cigars went toward a reception for a ship owners’ meeting in the Cayman Islands. Thousands of dollars more were spent on cigars that were handed out at the annual boat show in Fort Lauderdale, Florida. These were also for the purposes of “official entertainment.”
The Compass met with officials at the Maritime Authority, including Mr. Walton, for more than two hours in September to discuss issues related to the credit card use. The newspaper withheld publication of the story until after the criminal trial of former Premier McKeeva Bush concluded.
Mr. Walton provided copies of detailed policies that the authority itself maintains with regard to travel, per diem and official entertainment expenses. The authority’s policy expressly forbids any personal expenses charged to government-issued cards.
The cash advances on Mr. Walton’s card were used for official travel expenses, including for per diem, food allowance and taxi transportation.
“This travel…is critical as more that 98 percent of [the Maritime Authority’s] annual income is earned on a fee-for-service basis,” he said. “These travel allowances are set out in the authority’s human resources manual, as approved by the Authority’s board of directors.
“These per diem and food allowances and other advances may be in the form of a [Maritime Authority] check issued before the employee leaves for official travel or taken as advances against the credit card during the course of travel. No matter the method of advance taken, they must be cleared by the employee through making an expense claim submission upon return from travel.
“When traveling across multiple currency areas on the same trip, I personally find that taking the travel allowances in the relevant currency on the date that is needed works more efficiently. Also, by taking your allowances as is necessary, you avoid taking these allowances in bulk before you leave for your official travel.”
Any additional charges incurred via cash advance or withdrawal fees for travel allowances would be paid by the Maritime Authority employees themselves, Mr. Walton said.