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Saturday, July 13, 2024

LIBERIA’S FIRST CARBON DEAL – ALLEGED BRIBERY, FRAUD AND ARREST

Date:

By James Harding Giahyue

MONROVIA – Many would believe that the current negotiation between the Liberian government and Blue Carbon of the United Arab Emirates is Liberia’s first attempt at a carbon credit deal.

Well, that is not true. Liberia’s first carbon trading discussions occurred more than one-and-a-half decades ago with a Carbon Harvesting Corporation (CHC), based in the United Kingdom, and worth US$2.2 billion.

The CHC deal went on to become one the biggest scandals of the administration of then President Ellen Johnson Sirleaf. It sparked cross-border investigations, with Monrovia requesting London to extradite a British businessman involved.

Liberian investigators found officials connived to grant CHC the carbon concession without any bidding. Evidence showed that Liberia would have lost millions of dollars, the Forestry Development Authority (FDA) board of directors and violated Liberian procurement law.

The CHC cross-border scandal had all the ingredients of a crime story: fraud, bribery, other violations of Liberia’s concession-related laws, and even plagiarism of an American study.

The four-year criminal activities ended with the arrest of the British businessman, a presidential pronouncement for the prosecution, reprimand and dismissal of the officials involved, and the impeachment of the senator.

From a carwash to the Office of the President

In 2007 about this time of the year, George Antwi, a Ghanaian, approached then River Cess senator Jonathan Banney about a carbon trading investment in the county. Antwi had been hired by Michael Foster, the owner of Carbon Harvesting Corporation (CHC), a firm based in Liverpool.

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Michael Foster faced extradition from the United Kingdom to Liberia between 2010 and 2015 for alleged bribery, fraud and criminal conspiracy over a carbon credit deal. Picture credit: Liverpool Echo

The deal appeared simple to Banney: CHC wanted to sequester carbon on 400,000 hectares of forestland in the southcentral county, obtain carbon credits and then sell them on carbon markets to companies wanting to offset their own carbon emissions. It would take eight years for the world to adopt carbon offsetting as a way to combat climate change at the Paris Climate Summit. However, experts, some in Liberia, were setting the pace for the global carbon trading market, a process still being done today.

Banney bought Antwi’s proposal right away.

“[Antwi] informed Mr. Foster about my eagerness of wanting investment to go to River Cess,” Banney would later tell investigators.

“Thereafter, I got an email. I informed the President about this investment proposal and that I wanted to extend [an] invitation to the investors. She agreed,” Banney would add.

In December of that year, Banney arranged a meeting between President Sirleaf and CHC represented by Foster, Antwi and other members of the company.

Things moved with lightning speed thereafter. By July 2008, there were meetings with the President and John Woods, the Managing Director of the Forestry Development Authority (FDA) at the time. A memorandum of understanding (MoU) with the chiefs and elders of Yarnee District, River Cess had been signed and Banney paid the FDA approximately US$15,000 for a biomass study.

Then in July 2008, CHC presented its proposal to the Liberian government to sell carbon credits on the unregulated and unverified carbon market at the rate of US$4 per tonne. It claimed that it had to trade below the international estimate of up to US$15 per tonne because Liberia’s rainforest was not recognized by the Kyoto Protocol, the UN operational mechanism for reducing carbon emissions.

That was followed by an analysis cost and benefits of its investment CHC claimed to have done, which found Liberia would benefit more from carbon credits than from commercial logging.

UK Police Arrests Foster

Then in February 2009, Woods informed the board of directors of the FDA and asked for the Public Procurement Concession and Commission (PPCC) for the CHC contract to be single-sourced, which was granted in December that year.

It was Woods’ efforts to get the green light from the Inter-ministerial Concession Committee (IMCC) that coincided with the demise of the CHC deal.

The Chairman of the National Investment Commission Dr. Richard Tolbert question the legality of the FDA negotiating the CHC instead of the IMCC. Tolbert suggested that the CHC proposals be sent to all members of the IMCC, including the Ministry of Justice and Finance. “I assume that the IMCC, constituted by the President for forest management contracts is the same body to act on this matter,” Tolbert said in a letter to Woods in early 2010.

Tolbert’s communications on the CHC deal continued until President Sirleaf requested him to constitute an IMCC negotiation of the CHC deal.

But it did not happen. In June that year, police in London arrested Foster for allegedly paying a bribe to seal the deal. The U.K.-based Global Witness, investigating the deal for two years, had told police Foster referenced an alleged US$2.5 million payment when they interviewed him.

It emerged that the company had calculated that Liberia would save 423 tonnes of carbon emissions in each hectare of the River Cess 400,000 hectares of forest. That meant 162 million carbon credits to Liberia, the Guardian of the U.K. reported.

But it emerged Liberia risked losing over US$2 billion if the CHC deal had gone on.  Thomas Downing, an expert with the Governance and Economic Management Assistance Programme (GEMAP), told the Guardian he had advised the FDA against it.

Downing said the carbon credit figures were “unreasonably high” and had “no commercial value” for Liberia. GEMAP was created by Liberia and the international community to help combat corruption after the country’s civil wars.

“I had understood that the Carbon Harvesting proposal had been definitively rejected. Thus, I was surprised to hear that it still enjoyed some support,” Downing said.

“The proposal, if adopted, would be quite damaging to the FDA. Indeed, it could cost [Liberia] hundreds of millions of dollars,” he added.

Liberia investigates the CHC deal

Back in Liberia, hell broke loose. President Sirleaf set up an official inquest into the CHC scandal. The head of the CHC Investigation Committee was Cllr. Negbalee Warner, the future dean of the Louis Arthur Grimes School of Law at the University of Liberia. Future deputy police chief Rose Stryker and one William Massaquoi completed the team.

“The President’s communication to the committee suggested that certain procedural requirements relative to the granting of such [a] concession might not have been followed,” Warner told the Guardian at the time. “For example, the proposal was recommended to the inter-ministerial committee without any open competitive bidding process.”

In roughly four months, Warner’s committee was back with its findings. It interviewed 19 people and institutions, including forest watchdog Global Witness and the United Nations Panel of Experts.

The committee recommended Banney be impeached as senator for abusing his legislative functions and bribery. CHC paid Banney over US$20,000 for arranging a meeting with President Sirleaf, getting River Cess communities’ consent for the project, running errands and pressuring the FDA and other entities to grant the concession.

Minister of Internal Affairs Ambulai Johnson was recommended to face prosecution for allegedly soliciting a US$2 million bribe from CHC. The committee heard the company asked him for help when it faced “obstacles” from other officials.

The committee recommended the dismissal of the Executive Director of the PPCC Peggy Meres. She allegedly influenced the procurement process through which CHC, a gaming company until now, single-sourced the concession.

The committee asked that Augustine Johnson, the agency’s geoinformation service manager, and Joseph Neufville, an adviser at the PPCC, be dismissed immediately. It found the duo allegedly solicited and accepted bribes and committed a procurement offense.

Woods, who was now replaced at the FDA over his poor health, was asked to be reprimanded over his alleged role in the scandal. “The MD has been paid and is on our side as he is dependent on us in the future,” the investigation found CHC officials bragged among themselves.

The committee also found that Woods had allegedly ignored the pieces of advice from Downing and Silas Siakor, the executive director of the Sustainable Development Institute (SDI), and others.

Downing’s case was more startling. The committee found that he had informed Woods that CHC’s so-called cost and benefit analysis was plagiarized from the United States Forest Service’s study on a California rainforest. Downing shared copies of the plagiarized study with Woods severally and both men even viewed the two documents.

Minister of Planning and Economic Affairs Amara Konneh was reprimanded for issuing CHC a concession certificate in breach of the procurement law. Konneh denied any wrongdoing, saying the report was politically motivated.

The committee recommended Foster and Antwi face the law in Liberia for alleged fraud, bribery and criminal conspiracy. Both men denied the allegations.

President Sirleaf agreed with the committee’s recommendation and took the actions it had suggested. She called on the Ministry of Foreign Affairs to request the extradition of Foster and announced additional restrictions on presidential visits.

But President Sirleaf later rescinded her decision against the Liberian officials. About a month later, she dismissed her entire cabinet, except for one minister.

Foster extradition case lingered until 2015 when police dropped all charges against him. U.K. police said they could not obtain evidence in key areas of their investigation. Source: daylight.org

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Smart News Liberia is an online news outlet and a product of Smart Media Group Inc. Our website, smartnewsliberia.com, covers a broad spectrum of news content. For inquiries or information, you can reach us at 0777425285 or 0886946925, or email us at smartnewsliberia@gmail.com or info@smartnewsliberia.com.

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