Independent Auditors Say AHTC’s Millions in Improper Payments could Amount to “Criminal Conduct”

Posted on Nov 1 2016 - 6:59pm by Redwire Singapore

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Independent auditors KPMG has found that flawed governance in the Workers’ Party-run Aljunied Hougang Town Council (AHTC), formerly AHPETC, led to improper payments running into the millions.

Improper payments made its former managing agent FM Solutions & Services (FMSS) and service provider FM Solutions and Integrated Services (FMSI) ran into over S$1.5 million.

The town council also overpaid when it appointed FMSS as its managing agent by more than S$1.2 million.

This report was made public on the AHTC website.

KPMG flagged “serious conflicts of interest” and a “failed control environment” by the town council.

It warned that the issues involving FMSS and FMSI were deliberate, “they could amount to criminal conduct.”

KPMG reported that “pervasive” control failures cutting across key areas of AHTC’s governance, financial control, financial reporting, procurement and records management over the audit period had the potential to “conceal and hinder the detection and identification of all instances of proper payment”, said the accountants.

As a result, it said it was unable to conclude whether the improper payments.

Noting that it is beyond the auditors’ mandate to conclude whether an offence has been committed, KPMG said:

“While our work was not focused on identifying potential criminal acts arising from the issues we observed, we are advised that, had the shortcomings (identified in) this report been committed deliberately, they could amount to criminal conduct, the implications of which the town council should consider.”

 

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