Syed trial: Accountant paid off credit cards without seeing statements

The University College of the Cayman Islands’ accountant paid off former president Hassan Syed’s credit cards without ever seeing the statements, he told a Grand Court jury this week.

Khemkaran Singh said he had repeatedly asked Mr. Syed for receipts and credit card statements to support his spending on college funded credit cards.

He said the president, who is accused of dishonestly spending more than US$200,000 on the college cards to fund a “lavish lifestyle,” had always assured him he would provide the paperwork, but never did.

“In all the time he was there, I did not get a single travel report or any other support for the bills,” Mr. Singh said, as he gave evidence in the ongoing trial on Wednesday and Thursday.

Despite Syed’s failure to provide paperwork, Mr. Singh acknowledged he had continued to put money on the card whenever the president asked him to do so.

“I was concerned that if I did not pay the money, the embarrassment it may cause to the president or the college by him representing the college abroad and not being able to meet expenses.

“I thought it would be a big embarrassment so I went ahead and followed his instructions.”

In May 2007, with the end of the financial year approaching, Mr. Singh said he had written to Syed asking him to account for some US$75,000 of expenditure on the card.

“Every day he was in office, I would request that he submit these documents … he always promised he would get it to me.”

He said he had explained to Syed the impact it would have on the college and on his own personal reputation as an accountant if he did not accurately allocate the expenditure in the financial statements and provide supporting documentation.

“It was going to indicate we don’t have a system. I explained the implications,” he said.

Under cross-examination from Syed’s attorney, Tom Price, QC, the accountant acknowledged that he had not raised concerns with the college’s board of governors or requested the statements directly from the bank himself.

In his evidence in chief, Mr. Singh said he had eventually requested the statements when the Office of the Auditor General, which was vetting the college’s annual financial statements, asked him to do so.

When they arrived, he said, he took the sealed envelope to the president’s office without opening it. Syed later returned the envelope to him, instructing him to pass it on.

The auditors later informed him that the statements were incomplete and requested he instruct the bank to send them directly to the auditor general’s office, which he did.

Once the completed statements arrived, Mr. Singh said he was sent a spreadsheet of unexplained expenses. He said Syed asked him to fill in the expenses as best he could. That process was still ongoing when Syed left the island. The jury also heard evidence that Mr. Singh regularly paid some of Syed’s personal expenses from college funds at the president’s request, keeping a running ledger of expenses paid and making deductions from his salary.

These included rent payments, utilities bills, medical expenses and insurance payments.

Mr. Singh, giving evidence Wednesday and Thursday, said he was comfortable with this arrangement as it was agreed in advance that the payments would be recouped through salary deductions. Those payments are not alleged to be dishonest and do not form part of the indictment.

Under cross-examination from Mr. Price, he acknowledged that the credit card agreement between Syed and the college did foresee the possibility of the cards being used for personal expenditure.

A clause in the agreement indicated that invoices and statements must be provided for authorized purchases and that the college could make salary deductions if expenses were of a personal nature.

He said he had not made such deductions from Syed’s salary because he simply did not know what the card was being used for.

Mr. Singh also gave evidence in relation to some of the other charges on the indictment.

He testified that Syed had submitted two separate invoices for a total of around CI$70,000 in purchases from Lominger Services connected to the establishing of a Civil Service College.

He said he was “taken aback” that the president had made such a large purchase on his own credit card but had authorized the refund after Syed told him the company did not accept Cayman credit cards.

Mr. Singh also confirmed that he had authorized a total of just over US$90,000 in consultancy fees to Syed based on time sheets the president submitted for his work in setting up the Civil Service College. He said he had not been shown a contract but was aware that Syed had been involved in the project and that other senior UCCI staff had received payments in connection with work on the college, which was a collaboration with government.

He said some of the money had been deducted from the amounts Syed owed the college for his bills and rent and other expenses rather than being paid directly to him. This did not include the credit card bills, which remained unexplained and unaccounted for.

Syed is charged with theft of more than US$200,000 from the college in relation to what the crown alleges is dishonest spending on the credit cards. He is charged with obtaining money transfers by deception in relation to the Lominger invoices, which the crown alleges were forged, and he is also charged with obtaining a pecuniary advantage in relation to the claims for consultancy fees, which the prosecutor has indicated he was not contractually entitled to.

In total, he is facing 12 charges relating to allegations that he dishonestly spend more than CI$500,000 of the college’s money.

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