PAAB files with court
Auditor Hans Hashagen has to explain why he has not submitted crucial documents in a forensic report.
The Public Accountants' and Auditors' Board (PAAB) last Thursday, filed its record of proceedings with the High Court in its defence against auditor Hans Hashagen's application to set aside a decision by the regulatory body to arraign him before a disciplinary hearing.
Hashagen is charged with six counts emanating from a forensic investigation he has led on behalf of Ernst & Young (EY) into alleged misconduct at the Namibia Financial Services Supervisory Authority (Namfisa) in 2009.
It is alleged that in his report to the Namfisa board, which commissioned the investigation, Hashagen omitted crucial information, which amounts to unprofessional conduct and possible fraudulent representation in contravention of the standards set in the PAAB Act.
It is further alleged that these omissions have led to his “final, deceptive and unsubstantiated conclusions”, which led to the departure of the then Namfisa CEO, Rainer Ritter, after a settlement agreement with Namfisa.
Ritter thereafter lodged a complaint with PAAB and the Institute of Accountants of Namibia (ICAN) against Hashagen.
Ey investigation
The Namfisa board appointed EY to conduct an investigation into alleged misconduct at Namfisa after it received a letter from a “concerned Namibian citizen” in December 2008 alleging corruption and racism by Ritter and other senior managers.
It later transpired that the 'concerned citizen' were disgruntled staff who, amongst others, alleged that Ritter “constantly” demanded that black staff members declare their private business interests to avoid conflict of interest, while apparently never requesting the same from white managers.
Ritter reported possible internal corruption to the Namfisa board, and some senior officials, the general manager of investments institutions, Boni Paulino and general manager IT, Petrus Kafidi, were suspended.
The suspension of these officials was, however, overturned a few days later and instead Ritter was suspended, with Namfisa at the time claiming that Ritter was sent on sick leave.
The Namfisa board decided to appoint EY to do the investigation to initially precede an internal disciplinary enquiry into the conduct of Paulino and Kafidi.
Purportedly, it was to assist the board to confirm the validity and authenticity of alleged misconduct by Paulino and Kafidi, as well as the allegations levelled against Ritter.
Terms of reference
EY was appointed to conduct its work at Namfisa at a time when the regulator had embarked on very sensitive investigations into, among others, the defaulting on loans amounting to possibly more than N$660 million at the GIPF's Development Capital Portfolio (DCP).
EY had to, among others, look into the validity and authenticity of eavesdropping devices allegedly removed by Paulino. Ritter at the time suspected that the eavesdropping devices were planted in the Namfisa offices to harvest voice data.
It similarly had to establish why Paulino and John Uusiku, the then manager of long-term insurance, did not declare the disappearance of a laptop belonging to forensic auditors working at the Namfisa office at the time.
Also to be investigated were the circumstances into the permanent disappearance of security files, and the failure of security cameras on certain dates, as well as the establishment of business relationships that could attest to conflict of interest of Namfisa staff.
The terms of reference pertaining to Ritter's conduct involved the recruitment of Adrianus Vugs as Manager of Risk and Policy, as well as procurement of services at Namfisa.
Hashagen was requested to investigate the appointment of Vugs two years after he had been appointed.
Ritter in his complaint to PAAB claimed that the omissions from Hashagen's report relates to Namfisa's investigations into the GIPF missing millions.
Apart from documentary evidence as proof that Ritter acted within his powers, it is maintained that the omitted information included the alleged security breaches at Namfisa, cell phone reports containing evidence of possibly corrupt conduct amongst Namfisa officials, and possible conflict of interest.
Hashagen in his founding affidavit maintains PAAB's intended disciplinary hearing against him is unlawful, and said omissions in the EY report was made because documents were either not provided to him or fell outside the scope of the contractually agreed investigation.
CATHERINE SASMAN
Hashagen is charged with six counts emanating from a forensic investigation he has led on behalf of Ernst & Young (EY) into alleged misconduct at the Namibia Financial Services Supervisory Authority (Namfisa) in 2009.
It is alleged that in his report to the Namfisa board, which commissioned the investigation, Hashagen omitted crucial information, which amounts to unprofessional conduct and possible fraudulent representation in contravention of the standards set in the PAAB Act.
It is further alleged that these omissions have led to his “final, deceptive and unsubstantiated conclusions”, which led to the departure of the then Namfisa CEO, Rainer Ritter, after a settlement agreement with Namfisa.
Ritter thereafter lodged a complaint with PAAB and the Institute of Accountants of Namibia (ICAN) against Hashagen.
Ey investigation
The Namfisa board appointed EY to conduct an investigation into alleged misconduct at Namfisa after it received a letter from a “concerned Namibian citizen” in December 2008 alleging corruption and racism by Ritter and other senior managers.
It later transpired that the 'concerned citizen' were disgruntled staff who, amongst others, alleged that Ritter “constantly” demanded that black staff members declare their private business interests to avoid conflict of interest, while apparently never requesting the same from white managers.
Ritter reported possible internal corruption to the Namfisa board, and some senior officials, the general manager of investments institutions, Boni Paulino and general manager IT, Petrus Kafidi, were suspended.
The suspension of these officials was, however, overturned a few days later and instead Ritter was suspended, with Namfisa at the time claiming that Ritter was sent on sick leave.
The Namfisa board decided to appoint EY to do the investigation to initially precede an internal disciplinary enquiry into the conduct of Paulino and Kafidi.
Purportedly, it was to assist the board to confirm the validity and authenticity of alleged misconduct by Paulino and Kafidi, as well as the allegations levelled against Ritter.
Terms of reference
EY was appointed to conduct its work at Namfisa at a time when the regulator had embarked on very sensitive investigations into, among others, the defaulting on loans amounting to possibly more than N$660 million at the GIPF's Development Capital Portfolio (DCP).
EY had to, among others, look into the validity and authenticity of eavesdropping devices allegedly removed by Paulino. Ritter at the time suspected that the eavesdropping devices were planted in the Namfisa offices to harvest voice data.
It similarly had to establish why Paulino and John Uusiku, the then manager of long-term insurance, did not declare the disappearance of a laptop belonging to forensic auditors working at the Namfisa office at the time.
Also to be investigated were the circumstances into the permanent disappearance of security files, and the failure of security cameras on certain dates, as well as the establishment of business relationships that could attest to conflict of interest of Namfisa staff.
The terms of reference pertaining to Ritter's conduct involved the recruitment of Adrianus Vugs as Manager of Risk and Policy, as well as procurement of services at Namfisa.
Hashagen was requested to investigate the appointment of Vugs two years after he had been appointed.
Ritter in his complaint to PAAB claimed that the omissions from Hashagen's report relates to Namfisa's investigations into the GIPF missing millions.
Apart from documentary evidence as proof that Ritter acted within his powers, it is maintained that the omitted information included the alleged security breaches at Namfisa, cell phone reports containing evidence of possibly corrupt conduct amongst Namfisa officials, and possible conflict of interest.
Hashagen in his founding affidavit maintains PAAB's intended disciplinary hearing against him is unlawful, and said omissions in the EY report was made because documents were either not provided to him or fell outside the scope of the contractually agreed investigation.
CATHERINE SASMAN
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