The price of a piece of land moved from $52 million to $175 million, and now the State feels there was bobol in the purchase, so they are going after a number of former State officials, including Jearlean John, former Managing Director of the Housing Development Corporation (HDC).
In a civil suit filed in court, the State is moving against John and other officials regarding the $175 million sale of Eden Gardens after the land was initially valued at $52 million
At a press conference on Friday, Minister in the Ministry of the Attorney General, Stuart Young, alleged there was corruption, bribery, breach of contract and a breach of fiduciary duty during John’s tenure as managing director.
The claims allege that an evaluator attached to the Commissioner of Valuations accepted a bribe to value the 50-acre property at $180 million, ignoring valuations provided by independent valuators Linden Scott, who valued the property at $52 million.
In 2012, the land was then purchased at $175 million, giving the impression of a $5 million discount.
Young said the action was initiated in November 2016 by the Housing Development Corporation (HDC) and the Office of the Attorney General against nine defendants: Jearlean John, Henckle Lall (former HDC chairman), Greg Davis (former deputy HDC chairman), Peter Forde, Project Specialist Ltd, former commissioner of valuations Ronald Heeralal, Point Lisas Park Ltd, Anthony Sampath and Patrick Soon Ting.
He said in keeping with civil proceedings rules the claim was not served at that time but applications were made to the court under granted orders to ‘follow the money’.
Following this, the claim was filed on June 20, 2017 and included a tenth defendant, Everil Ross.
Young said Ross, who was an officer at the Commissioner of Valuations, allegedly received a bribe to value the land at a higher figure compared to that of Linden Scott.
He added, “In following the money trail we found what is believed to be the payment of a bribe to Mr Everil Ross who was actually an officer at the Commissioner of Valuations office, who did the valuation, valuing the land at $180 million, even though a private valuator, Linden Scott and company, valued the land at 50-something odd million dollars.”
“Interestingly, this payment was made by those persons who sold the land to the HDC, Point Lisas Park Ltd, of $50,000, exactly one week after the agreement was signed between themselves and the HDC for the purchase of this land for $175 million.”
Young said in June 2004, Sampat, Soon Ting and Azad Niamat, bought Eden Gardens for $17 million but only paid $2 million.
In 2010, the men rescinded the transaction, selling the lands back to the owner for the same price, then set up the company Point Lisas Park Ltd which purportedly bought the same land for $5 million.
That company then mortgaged the company to the original owner for $18.5 million in 2012.
Young said between 2010-2012 the company tried to sell various lots of land on the open market at $400,000 per lot, which worked out to $120 million. However, no plots were sold.
He added, “In 2011 it appears as though they began discussions with people at the HDC to now purchase this land.”
He said the HDC recommended a Linden Scott valuation which priced the property, based on one gross acquisition, at $52 million, however, Niamat wrote to HDC offering the land for $200 million.
Young said that they accessed board minutes where an attempt was made to persuade the board to agree to purchase the land and a suggestion was made by officers in the HDC that the land be valued by the Commissioner of Valuation at the Ministry of Finance.
The Minister revealed, “We’ve since discovered the action was conducted by Ross (who) tried to discredit Linden Scott by providing a valuation for $180 million. Based on this…the taxpayers were saddled with a purchase of land, which was really only valued at $52 million, for $175 million.”
He said HDC went to Cabinet for approval to procure the land, after which the sale was concluded, and a few weeks after, the alleged bribe was paid.
He said the Ministry found that payments were made to other persons and these are also being looked at.
John and several other HDC officials were sent on leave following the launch of an internal audit in December 2015. John was subsequently removed from her position in March 2016.
She is suing the HDC for 17 million, claiming damages for wrongful dismissal and breach of contract of employment.
Young said the minister who took the note to Cabinet, “and persuaded the Cabinet” to accept this arrangement, was “Roodal Moonilal”.
Young said when the State valuator came up with the $180 million valuation, certain persons sought to discredit the Scott valuation of $52 million. Young said in November 2011, HDC had asked Linden Scott for a valuation, while in July 2012 the second valuation was done by State valuators.
The vendors, who had initially offered HDC the land for $200 million, accepted a so-called sacrificial reduction of $175 million.
Young said: “We found a cheque for $50,000 paid from the people who sold the land to (government valuator) Ross.” Young said the valuation was done by Ross, but signed by Heeralal. The sale transaction was signed off on July 13, 2012 and the cheque was paid to Ross on July 30, 2012.
“And that was the bribe,” he said.
Yong continued, “We have found other payments being made to other persons and those are currently also being looked at.”