Published On: Thu, May 24th, 2018

Blistering picture of mismanagement at the port

Port St. Maarten

PHILIPSBURG – The attorney for the public prosecutor’s office, Rogier van den Heuvel, presented a blistering picture of mismanagement and fraud at the harbor companies on Thursday at the hearing with the Common Court of Justice to obtain the right to conduct a civil inquiry.

The prosecution got wind of fraud at the harbor through the Emerald-investigation. That started after O’Neal Arrindell took over Checkmate Security and obtained a contract that was three times higher than the contract the same company had for the same work under previous ownership.

The investigation showed that port director Mark Mingo and Arrindell were in cahoots by manufacturing fraudulent invoices for different small contractors. “Mingo gave the global description of the invoices to Arrindell, who dictated them to his external accountant who simply cooperated and tinkered with the invoices,” Van den Heuvel told the court.

The invoices – 330 in total – landed on Mingo’s desk and he signed them. The value of these invoices – that cover the period from 2012 to 2016 – is more than $8.2 million. All invoices were below 50,000 guilders (roughly $28,000) and thus did not require permission from the supervisory board of directors. “Mingo could hide them easier,” the attorney said.

The port issued checks to pay the invoices and the money was deposited in the accounts of the contractors. Oftentimes, between 85 and 98 percent of the money was withdrawn the same day. “The contractors could not show where that money went but it stands to reason that Arrindell and Mingo pocketed it,” Van den Heuvel told the court. Some of the money went to payments for Arrindell’s children at a private school.

But there was more: Arrindell and Mingo increased contracts with dredging company Devcon by $3.1 million and added a fraudulent invoice worth $1.2 million for mobilization costs. “Devcon was already mobilized,” the attorney said. “This is another $4.3 million in fraud of which Arrindell and Mingo paid $370,000 to politician Frans Richardson.”

That the harbor is dragging its feet with Mingo’s dismissal is a thorn in the prosecution’s hide, Van den Heuvel noted. “He’s been sitting at home for quite some time enjoying an royal salary. The harbor wants to await the result of the criminal investigation and the shareholder sits on its hands, in spite of the findings of the prosecutor’s office that are obviously sufficient for dismissal. The man embezzled almost $13 million and God knows how much more.”

Van den Heuvel said that the fraud the prosecution has uncovered so far is probably just the tip of the iceberg. “In 2009 there was already fraud committed with the involvement of Arrindell.”

The prosecution accuses the harbor of duplicity, because when Mingo was arrested on June 6, 2017, it had already identified $7 million worth of fraud. These findings were discussed with Richard van der Mark and his attorney on July 11; Van der Mark had been temporarily charged with the management of the port, together with Ton van Kooten. “We told them, but this was apparently no reason to take action against Mingo,” Van den Heuvel said.

The chairman of the supervisory board at the time (now board member) Humprey Mezas told investigators that the supervisory board had already researched the contested invoices. “The supervisory board established that the internal control system was faulty, that what Mingo had done was unacceptable and that he should be removed from his position.” In spite of all this, the board did nothing.

The request for the civil inquiry also addresses the construction of the causeway bridge across the Simpson Bay Lagoon – price tag $50 million. The prosecution challenges the interest of the harbor in the construction of the bridge and it charges that the harbor fails to provide information about the project.

“What shows that this bridge was worth $50 million for the harbor? That does not appear from anything. Was it indeed only an election promise from Heyliger, as the newspaper makes us think? The harbor says nothing about the decision making process; it only gives information about what happened after the decision was taken. This way important matters remain hidden.”

Another topic is the so-called Octavio-loan (worth $3.5 million) the harbor obtained from, according to Van den Heuvel, an obscure company in Panama whose director happened to be a brother of the chairman of the supervisory board at the time, Michel Soons.

Attorney Chris de Bres contested that this was a conflict of interest. “There is not a single indication that the harbor has been disadvantaged by the indirect conflict of interest of this one member of the supervisory board.”

Also a point of discussion is the $10 million settlement with developer Zebec. The developer claimed $100 million in damages from the port after it aborted a plan to develop 3,000 square meter near the harbor. The argument was that the cruise lines (Royal Caribbean and Carnival) had to approve the development and apparently the cruise lines wanted to limit the development to 1,000 square meters.

The port settled the dispute for $10 million, saying that a large part of that amount had been paid by the party that took over the development from Zebec. “If that is true it is hard to explain why the land is still fallow. Without concrete information this transaction remains a reason to doubt that this was correct policy. That has to be investigated,” Van den Heuvel said.